Black Americans are about three to five times more likely to be audited by the IRS than other taxpayers, a new study shows. Here’s what it means for filers.
The findings show Black filers claiming the earned income tax credit were more likely to be audited than non-Black filers claiming the same credit.
"It's a type of audit that the IRS does a lot," she said."It's cheap, it's easy to perform and Black taxpayers get caught up in that disproportionately relative to non-Black taxpayers." Smith said the IRS has focused on specific mistakes with claiming the earned income tax credit, such as missing dependents or misreporting income, which are required for eligibility.
"Focusing on these individual-level issues rather than the total dollar amount of underreporting seems to be driving these differences," she said, noting a shift to self-employed earned income tax credit filers would help address the problem.
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