The Number of IRS Criminal Cases Continues to Fall

Posted on April 08, 2019

The IRS brings criminal cases against taxpayers to do two things, namely to punish the person that the government thinks should be punished and to scare everybody else into filing honest and accurate tax returns and paying their liability. However, and primarily due to budget cuts, the number of criminal cases brought by the IRS continues to fall. In 2017, the IRS’ Criminal Investigation Division brought 795 tax fraud cases, a 25% reduction since 2010. In 2011, the IRS had nearly 50,000 enforcement employees. However, and because of budget cuts, IRS enforcement staffing has been reduced by 1/3, to 33,500 individuals. The IRS typically discovers fraud by a taxpayer by auditing tax returns. Evidence obtained in a civil tax audit can be used in criminal cases. However, since the budget cuts began, the audit rate has been reduced by 42%. Criminal referrals are also down, from 589 in 2012 to only 328 in 2016. It looks like there has never been a better time to be a tax cheat. What do you think?