TaxAudit Explains How the Inflation Reduction Act Will Impact Taxpayers

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The IRS is hiring 87,000 more agents, but with TaxAudit’s Audit Defense, you won’t need to worry about facing an audit alone.

On August 16, 2022, President Biden signed the Inflation Reduction Act into law, proposing that $80 billion in funding be directed toward the IRS over the next ten years. According to CNBC, more than $45 billion of those funds will go toward tax enforcement to help close the estimated $600 billion tax gap – the difference between what Americans actually owe versus what they have paid.

The Congressional Research Service states that these funds will be used to hire 87,000 more IRS agents, provide legal support to the agency, and enforce taxes on digital assets like cryptocurrency. The money will also fund new investigative technology that uses artificial intelligence to help uncover criminal activity, such as fraud, identity theft, money laundering, and hidden assets. The Congressional Budget Office estimates that these additional enforcement measures funded by the Inflation Reduction Act will generate over $204 billion in revenue by the year 2031 – but what does that mean for taxpayers?

With this additional funding and enhanced monitoring, the IRS plans to conduct more audits in an effort to close the tax gap. According to the Wall Street Journal, in 2018 – the last year in which the IRS released complete data – more than 95% of all audits were performed on households with less than $200,000 in income, and over 75% of audits were on households with less than $75,000 in income. Less than 5% of all audits were on households with an income of $200,000 or more, meaning that the middle and lower classes are at the highest risk of being targeted for an audit.

However, with TaxAudit on your side, you don’t have to worry about facing an IRS audit on your own. With over 17 million members, TaxAudit is the largest tax representation service in the country for tax-paying individuals and small businesses. When you have an Audit Defense membership, TaxAudit will handle everything on your behalf – from the very first notice you receive all the way through to the resolution of your case.

With an Audit Defense membership, TaxAudit will:

  • Defend both state and federal income tax returns, including tax returns filed late.
  • Professionally and promptly address tax audit notices that you receive and report to us.
  • Provide an easy-to-use, secure portal for you to upload all documentation.
  • Explain your options and develop a strategy.
  • Review your documentation before presenting it to the taxing authority.
  • Schedule and attend all audit phone calls and appointments on your behalf.
  • Defend your tax return through the entire audit process.
  • Minimize your financial impact.
  • Make sure you pay no more tax than what you rightfully owe.

If you want the peace of mind that comes with knowing that you have world-class experts to represent you in the case of an audit, you can easily purchase a membership on our website or call our Customer Service team at 800.922.8348, and they will be happy to help!

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Danielle Miranda
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