The Internal Revenue Service (IRS) recently announced it will resume enforcement efforts — but what does this mean? The tax agency, like many other businesses throughout the country, drastically cut back its efforts over the past few months as a result of the COVID-19 pandemic. Officials put many enforcement efforts on hold and pushed back deadlines. Now taxes are due, workers are heading back into the office and the agency is moving ahead with normal operations.
Que the need to resume enforcement efforts. Based on previous communications, it appears the agency will jump start this resumption with renewed focus. Two specific areas of focus will include high-income taxpayers who have failed to file their tax returns and an examination of those who claim research credits.
Focus #1: High income earners
Those who earn over $100,000 annually and fail to file tax returns are at an increased risk for an audit. The agency has stated that these audits may come in the form of a personal visit from an IRS agent. The agent, they state, will provide information to the taxpayer about their tax obligations and encourage them to file their returns.
Focus #2: Research credits
The agency has also stated it will increase enforcement efforts regarding the proper claiming of research credits. These enforcement efforts will likely require the use of experts in science, engineering and other technical fields as well as the use of IRS engineers. The agency states that these credits require highly factual evident to support the claim.
Whether facing an audit for these or other reasons, taxpayers do not have to go through the process alone. Taxpayers have the right to legal representation to protect their interests throughout the process. The attorneys at Goldburd McCone are experienced with these tax issues and can provide counsel.