The IRS announced it was planning on pursuing “high-income individuals evading taxes” and claims to have made millions in recoveries at a time when the agency is increasingly facing heat for targeting a higher percentage of lower-income Americans as part of its tax audits.
“The IRS is working to ensure [that] high-income filers pay the taxes they owe,” the Internal Revenue Service (IRS) said in a news release on Friday. “Prior to the Inflation Reduction Act (IRA), more than a decade of budget cuts prevented IRS from keeping pace with the increasingly complicated set of tools that the wealthiest taxpayers use to hide their income and evade paying their share. The IRS is now taking swift and aggressive action to close this gap.”
“In recent months, our Criminal Investigation team has closed a lengthy list of cases where wealthy taxpayers have been sentenced for tax evasion, money laundering and filing false tax returns.
“Instead of paying taxes, these evaders spent money owed to the government on gambling at casinos, vacations and the purchase of luxury goods. For example, in one case alone, the person was ordered to pay more than $6 million in restitution.”
According to the IRS, they have closed around 175 delinquent tax cases for millionaires in the last few months, generating $38 million in recoveries. “This is just the start. We will continue to go after delinquent millionaires as we ramp up enforcement capabilities through the IRA.”
The IRS claims it has recently identified around 100 high-income individuals who were living in Puerto Rico without real residency for the purpose of securing potential tax breaks. The agency is also looking into taxpayers making use of Washington’s treaty with Malta to “improperly” claim tax exemptions.
“The IRS of today is laser-focused on holding our highest-wealth filers, millionaires and billionaires, accountable for what they owe,” Commissioner Danny Werfel told reporters in a briefing.
The Inflation Reduction Act, passed last August, had set aside $80 billion for the tax agency over a period of ten years to boost enforcement as well as improve operations and service.
