IRS enforcement activities dropped in 2016

By Sally P. Schreiber, J.D.

The IRS reported several large drops in its enforcement activities in fiscal year 2016, including a 16% drop in audits, a 40% drop in levies, and a 9% drop in liens compared to the prior year. These figures were revealed in the IRS’s 2016 Data Book, which reports on the agency’s activities for the fiscal year beginning Oct. 1, 2015, and ending Sept. 30, 2016.

According to the Data Book, the IRS audited just over 1 million individual tax returns in FY 2016, almost 16% fewer than last year’s 1.2 million. The percentage of individual taxpayers audited fell to 0.7%, which the IRS said was the lowest rate in more than a decade. The Data Book also reports that the IRS’s enforcement budget was reduced by almost $107 million in FY 2016.

However, the IRS collected more than $3.3 trillion in gross taxes in this period and refunded more than $426.1 billion. And the IRS collected almost $1.8 trillion before refunds of individual income tax and, from businesses, almost $345.6 billion in income taxes, before re­funds, in FY 2016.

The IRS also reported much greater use of its website in FY 2016. Unique visits to the site totaled more than a half billion, and the most popular feature, “Where’s My Refund?,” was used almost 300 million times, an increase of almost 28% over FY 2015. Another big increase came in the number of taxpayers using IRS2GO, the IRS’s mobile app, which increased 29% over last year.

The IRS also claims to have improved its live telephone assistance over last filing season (after receiving many complaints from taxpayers and practitioners the last few filing seasons). It claimed that it provided live telephone assistance over 25.5 million times, an increase of 40% over last year.

—Sally P. Schreiber (Sally.Schreiber@aicpa-cima.com) is a Tax Adviser senior editor.

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