August 16, 2022
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2:12Now PlayingHouse Minority Leader Kevin McCarthy tweeted that there will be 710,000 new audits for Americans who earn less than $75,000.
The National Desk’s Fact Check Team has been looking through the Inflation Reduction Act to see if his statement adds up.
There are some holes in McCarthy's assessment. Republicans used a 2021 Congressional Budget Office analysis that said new funding for the Internal Revenue Service would raise audit rates for taxpayers to levels of about 10 years ago.
Based on the analysis, GOP leaders took 2010 audit rates and 2018 tax returns and concluded there would be thousands of new audits for the middle class. The main issue with the claims is that the CBO's analysis is not of the updated bill and none of those figures are in the bill.
According to the latest numbers from the IRS, in 2019, Americans making between $25,000 and $500,000 had a 0.2% audit rate. The highest was for those making more than $10 million at a rate of 8.7%.
A Government Accountability Office report that shows from 2010 to 2019, audit rates decreased for all income levels. IRS officials said audit rates declined due to staffing decreases and because it takes more staff time and expertise to handle complex higher-income audits.
The Biden administration says there shouldn’t be any negative impact on the middle class.
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