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Improvement needed on audits

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in Small Business Tax

In a new report, the Government Accountability Office (GAO) states that the IRS must improve its performance on correspondence audits. (GAO-14-479, 6/5/14)

This should increase compliance and reduce the burden on taxpayers. Significantly, the GAO found that notices sent by the IRS often miss the mark. For instance, recent notices stated that the IRS would respond within 30 to 45 days, when it actually takes the agency several months to complete them. Also, tax refunds are generally delayed until the IRS finishes the audits, frustrating taxpayers and resulting in unnecessary calls to the agency. In response to the report, the IRS described certain measures it hopes will alleviate the problems, but pointed out that it is operating under severe budgetary restraints.

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