Congress Urged to Limit IRS Audits Targeting Small Businesses
Congress is urged to impose limits on IRS audits targeting small businesses, as the agency disproportionately targets middle-class families and small businesses. The current system, critics argue, favours large corporations and stifles competition.
The IRS's audit practices have come under scrutiny. Over 90% of audits are directed at families and small businesses earning less than $400,000 annually. These audits, while time-consuming and expensive, can be devastating for small businesses. The fear of IRS scrutiny discourages small businesses from investing and hiring.
Reforming the IRS is seen as a crucial step towards fairness. This should start with rebalancing its priorities to ensure it serves all taxpayers equally. Congress is now considering legislation to limit small business audits and require the IRS to justify its audit selections.
The government shutdown, the first since 2019, has highlighted the need for IRS reform. Small businesses are not seeking special treatment, but a level playing field in the tax system. President Trump previously blocked plans to expand the IRS workforce, but now, Congress aims to address the imbalance and protect small businesses from excessive audits.
