Is the Internal Revenue Service (IRS) impartial? That question is currently circulating in Washington and throughout the country. The question was fueled by the recent audit selection of two high ranking government officials who spoke out against former President Donald Trump: Former FBI Director James Comey and Deputy Director Andrew McCabe.
The audits were not just any type of audit, but a rare and highly intensive IRS deep dive into their financials. The fact that the IRS flagged both for the National Research Program (NRP) audit has led to concern that the agency is not acting impartial.
What is so special about these audits?
As discussed in an interview with The Hill, these audits are very intensive. The government uses all sorts of metrics to choose targets. These can include:
- Lifestyle. Odds of an audit increase if a taxpayer’s lifestyle does not line up with their tax returns.
- Whole numbers on tax returns. The odds also go up if it appears the taxpayer estimated their expenses and other amounts within their tax returns. Whole numbers are often a red flag.
The exact selection process is a closely held secret. Those who believe the audits were impartial point to the fact that both subjects spent years in federal office and released best-selling books after they left their positions. This led to a drastic change in their tax returns in a short period of time.
What if I am the subject of a federal tax audit?
Whether impartial or not, the discussion serves as a reminder of the need to take notification of a tax audit seriously, whether the audit is an intensive NRP audit or other form of audit. The attorneys at Goldburd McCone have experience in these matters and can advocate for your interests.