IRS Commissioner Danny Werfel offered some specifics about the agency's plans for audits of wealthy individuals and corporations at a press conference last week, Dow Jones Marketwatch reported. These figures can be found in the IRS's recently published strategic operating plan update and update supplement.

By the time taxpayers file their 2026 taxes, the IRS plans to implement a 50 percent increase in the audit rate for households with incomes of $10 million and up, compared to 2019, as well as a near tripling of the rate of corporate audits. That means that it plans to audit 16.5 percent of the 2026 returns for households with total positive income of at least $10 million, up from 11 percent in 2019. The agency plans to audit 22 percent of returns from corporations with at least $250 million in assets, up from 9 percent in 2019.

Werfel told reporters that that there are no plans to increase audits on households making less than $400,000. “Those remain at historically low levels,” he said.

Werfel also spoke about the agency's hiring plans through the end of the decade, MarketWatch reported.. The IRS now has approximately 90,000 full-time employees, up from around 79,000 employees in fiscal year 2022, he noted. Werfel is seeking a headcount of around 102,500 at the end of this decade, he said. "We believe that figure represents a right-sized IRS," he said. 

The updated strategic operating plan, and the meeting with reporters, served as opportunities to demonstrate how the IRS has used the funding allocated to it by the Inflation Reduction Act to improve service, expand enforcement efforts and improve its antiquated technology, among other key objectives, Accounting Today reported.

“These efforts will continue to accelerate as we get deeper into the strategic operating plan and as we continue the work made possible by Inflation Reduction Act funding," said Werfel. "By many measures we have seen an incredible amount of progress since we received this funding less than two years ago."

"The IRS will continue focusing on making improvements and efficient use of funding," he told Accounting Today. "We highlight accomplishments rather than taking a victory lap because more work remains. But to stress the importance of continuing this momentum, the IRS will continue working to make a difference for the nation's taxpayers. At the same time, it's critical that the IRS has stable, secure funding to allow technology modernization and taxpayer service improvements to continue into the future." 

Laurel Blatchford, the Treasury Department's chief implementation officer for the Inflation Reduction Act, highlighted some of the uses that the IRS has already made with the extra funding at the press conference.

"During the 2024 filing season, the IRS answered more than one million more calls than the 2023 filing season while maintaining an average wait time of just over three minutes," she said, according to Accounting Today. "The new callback option made available for the 2024 filing season saved taxpayers an estimated 1.5 million hours of sitting on hold. The IRS Taxpayer Assistance Centers serve more than 780,000 taxpayers in person, an increase of more than 37 percent compared to 2023. The IRS launched the Simple Notice initiative to review, redesign and deploy hundreds of notices so taxpayers could better understand the actions they needed to take with an immediate focus on the most common notices that individual taxpayers receive. Thirty-one notices were deployed for the 2024 filing season."

Blatchford also pointed to some of the ways that the IRS strengthened individual enforcement against complex partnerships, large corporations and wealthy individuals. 

"The IRS is using [Inflation Reduction Act] resources to strengthen enforcement and pursue complex partnerships, large corporations and wealthy individuals," she said, according to Accounting Today. "The IRS has launched new initiatives in each of these areas with significant success so far. They have launched new initiatives to crack down on abuse of corporate jets for personal travel, and 125,000 wealthy individuals who have not filed tax returns for years. Using artificial intelligence and advanced analytics to help select complex partnerships for audits, the IRS has launched audits at 76 of the largest partnerships with average assets of $10 billion that represent a cross-section of industries, including hedge funds, real estate investment partnerships, publicly traded partnerships, large law firms and other industries. The IRS also is launching audits of the 60 largest corporate taxpayers with average assets of $24 billion. While the IRS has made significant progress over the last year toward delivering transformational change, there's so much work to be done in the coming years."