4 ms·

This is a non-issue. Millionaire are far more likely to have a accountant/tax professional. Which would of course means they would have all the required documen

This is a non-issue. Millionaire are far more likely to have a accountant/tax professional. Which would of course means they would have all the required documentation at the time of filling. What would be interesting is the percentage of tax fraud going on in these different brackets.

cm2187 4y ago
Also auditing regular employees is trivial if not fully automatable, so you would expect a larger proportion of them to be audited.
- psychphysic 4y ago
  Finally there are many more poor people than millionaires.
  - cm2187 4y ago
    yeah but they are comparing auditing rates per 1000
- nine_zeros 4y ago
  > Also auditing regular employees is trivial if not fully automatable, so you would expect a larger proportion of them to be audited. Because nickel and diming the poor using automation helps hit audit metrics easier than actually unraveling the complex tax law on multi-millionaire filings.
  - cm2187 4y ago
    The "poors" don't fill tax returns. And yes the middle class is a big mass compared to multi-million fillings.
deleted 4y ago
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dsr_ 4y ago
If your hypothesis is true, then million-dollar income tax statements are easier to audit than hundred-k income tax statements. If it's 5x harder to audit someone who made a million dollars than someone who made 100,000, it's still worth auditing two of the million-dollar returns for every 100K return.
- nwah1 4y ago
  It isn't about difficulty. It is about compliance. People who haven't complied with the law for their filings are going to get targeted more.
- s1artibartfast 4y ago
  >If it's 5x harder to audit someone who made a million dollars than someone who made 100,000, it's still worth auditing two of the million-dollar returns for every 100K return. Why is it equivalent worth? Shouldn't that have to do with the level of fraud discovered and taxes recovered? Many of the errors in low income filings are incredibly easy to detect. Think 1000x easier, and automated. These are things like two parents claiming the same dependent with the same SSN.
themagician 4y ago
It's not that they have documentation as much as it is that the tax code is more subjective for high earners that run businesses, because what is an isn't a legitimate business expenses or R&D or whatever is not always clear cut, and the tax code gives a good amount of leeway. And even when it doesn't give much leeway, it's still a lot of work for the IRS to prove their case unless the fraud was explicit and deliberate. The tax code is this way on purpose. It's designed to encourage businesses and people to spend.
tonfreed 4y ago
I wouldn't say it's a non issue, it highlights a significant problem in the tax code.

cm2187 4y ago

Also auditing regular employees is trivial if not fully automatable, so you would expect a larger proportion of them to be audited.

psychphysic 4y ago
Finally there are many more poor people than millionaires.
- cm2187 4y ago
  yeah but they are comparing auditing rates per 1000
nine_zeros 4y ago
> Also auditing regular employees is trivial if not fully automatable, so you would expect a larger proportion of them to be audited. Because nickel and diming the poor using automation helps hit audit metrics easier than actually unraveling the complex tax law on multi-millionaire filings.
- cm2187 4y ago
  The "poors" don't fill tax returns. And yes the middle class is a big mass compared to multi-million fillings.

deleted 4y ago

[deleted]

dsr_ 4y ago

If your hypothesis is true, then million-dollar income tax statements are easier to audit than hundred-k income tax statements. If it's 5x harder to audit someone who made a million dollars than someone who made 100,000, it's still worth auditing two of the million-dollar returns for every 100K return.

nwah1 4y ago
It isn't about difficulty. It is about compliance. People who haven't complied with the law for their filings are going to get targeted more.
s1artibartfast 4y ago
>If it's 5x harder to audit someone who made a million dollars than someone who made 100,000, it's still worth auditing two of the million-dollar returns for every 100K return. Why is it equivalent worth? Shouldn't that have to do with the level of fraud discovered and taxes recovered? Many of the errors in low income filings are incredibly easy to detect. Think 1000x easier, and automated. These are things like two parents claiming the same dependent with the same SSN.

themagician 4y ago

It's not that they have documentation as much as it is that the tax code is more subjective for high earners that run businesses, because what is an isn't a legitimate business expenses or R&D or whatever is not always clear cut, and the tax code gives a good amount of leeway. And even when it doesn't give much leeway, it's still a lot of work for the IRS to prove their case unless the fraud was explicit and deliberate. The tax code is this way on purpose. It's designed to encourage businesses and people to spend.

tonfreed 4y ago

I wouldn't say it's a non issue, it highlights a significant problem in the tax code.