The U.S. Internal Revenue Service is the single largest collections agency in the world. We always find it kind of cool to analyze the collections data that is released every year. It always provides some insight into what is going on in the “delinquent” or “unfiled” tax return world. Since filing old tax returns is what this site is all about, here are some interesting tidbits from the most recent statistics available:
Budget & Personnel
In 2014 the IRS spent $11.6 billion and employed just over 84,000 to collect more than $3.1 trillion in tax revenue. Of those 84,000 personnel, over 18,000 are directly involved in enforced collections against taxpayers that owe back taxes. In 2013 the IRS spent $11.6 billion to collect $2.8 trillion in tax revenue, using just under 87,000 employees, of which 19,000 were involved in enforced collections.
Delinquent Tax Return Inventory
In 2014 the IRS began with 11.7 million delinquent accounts (unfiled returns). 7.6 million new cases were added to inventory while only 6.9 million were closed. This put the ending inventory at 12.4 million returns. In 2013 the IRS saw 7.7 million new cases added to inventory but they were able to close 7.5 million.
In 2013 there were 145.2 million individual tax returns filed, of which 1.2 million were selected for review (audit) in 2014. Thus the effective audit rate was 0.9%. Of those returns examined, the IRS proposed changes in 87% of them with an associated $11.8 billion increase in taxes owed. For the returns that were reviewed in 2013, the audit rate was 1%, the IRS proposed changes in 89% of what it reviewed with an associated tax increase of $14 billion.