00:00No one wants to get audited, but a new report by the Transactional Records Access Clearinghouse, or TRAC,
00:05a federal enforcement staffing and spending watchdog reveals lower-income earners are markedly higher
00:11on the Internal Revenue Services list when it comes to scrutinizing tax reporting.
00:15According to TRAC, of the 164 million tax returns that were filed, 626,204 of them were audited.
00:23But despite the fact that millionaires and billionaires are known to not pay their fair share
00:27and often hide their income through clever accounting, low-income earners were many times more likely
00:32to have their finances looked at, with TRAC's report explaining, quote,
00:35the taxpayer class with unbelievably high audit rates, five and a half times virtually everyone else,
00:41were low-income wage earners, taking the earned income tax credit.
00:45But TRAC's report also hypothesized that the IRS isn't auditing simply because they believe
00:49these people are under-reporting their income more often, but rather because the IRS must rely on audits
00:54to fix income reporting issues of those people who aren't able to ask the agency any questions
00:59with regards to completing earned tax credit forms.
01:02However, audits of the mega-wealthy are still down.
01:05A decade ago, 40,965 people making over a million dollars would have been audited each year.
01:11That number dropped to just 11,331 in 2020.
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