Increasing audit coverage will be a big focus over the next 12 months, according to an official with the IRS Small Business/Self-Employed
(SB/SE) Division.
Speaking in Chicago at an American Law Institute – American Bar Association tax controversy
conference on administrative concerns, Faris Fink, Midwest area director (examination) of SB/SE, said that audits will increase
for individuals with adjusted income of more than $200,000. “That’s an area of focus that we want to get out,”
he said.
Flow-through entities such as partnerships and subchapter S corporations will also be subject to greater
scrutiny over the next year, Fink said. “That is where we’re seeing the most abuse,” he said.
When
asked it the government would be targeting entities that issued Forms K-1 with no wages, Fink answered, “Absolutely.”
He also said to expect a small increase in the number of corporate returns under $10 million examined, although “not
near as dramatic.”
One challenge for IRS Small Business/Self-Employed (SB/SE) Division, Fink said, is that
70 percent of its employees have less than fours of experience.
