Look sharp--the IRS is beefing up its enforcement tactics and cracking down on tax cheaters.
Hopefully, your tax house is in order--because the IRS is watching. "The IRS has committed itself to more vigorous enforcement, along with its step-up in service," says the IRS' Don Roberts. "It is now focusing on corporate and high-end noncompliance and promoters of abusive tax shelters."
As part of this push, the IRS' new commissioner, Mark W. Everson, recently announced a series of steps to improve agency operations, in effect freeing up funds for enforcement. In 2005, the IRS plans to close its Memphis, Tennessee, tax-return processing operations and stop processing paper returns at that location, given the huge increase in electronic filing: Since 1990, the number of returns filed electronically has grown from 4 million to 53 million in 2003. In addition, the IRS will consolidate the number of offices set up for exam, collecting and insolvency cases from 92 locations to four.
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