by Stacy Jackson

May 16, 2023

IRS Admits Black Taxpayers Are Five Times More Likely to Be Audited Than Any Other Race

The Internal Revenue Service (IRS) recently confirmed research findings that Black taxpayers are are at greater risk of having their federal tax returns audited at higher rates than taxpayers of other races.

According to CBS News, the internal investigation called for the IRS to review its auditing processes at the demand of lawmakers and policy experts after a study from Stanford Institute for Economic Policy Research revealed Black American taxpayers are up to five times more likely to be audited at rates that don’t reflect their share of the U.S. population.

“[O]ur initial findings support the conclusion that Black taxpayers may be audited at higher rates than would be expected given their share of the population,” IRS Commissioner Daniel Werfel wrote in a letter to the U.S. Senate.

“Back in March my colleagues and I raised alarms to the new IRS boss about Black taxpayers being over-audited and today he confirmed our suspicions,” Rep. Bill Pascrell, Jr. (D-NJ) tweeted. “The IRS is making strides but extra audits of Black Americans is disgraceful and must end.”

The study claimed Black Americans saw higher audit rates as a result of an artificial intelligence algorithm used by the tax agency that may have been flawed.

Werfel confirmed the IRS plans to use an $80 billion fund through the Inflation Reduction Act to “understand any potential systemic bias in compliance strategies and treatments.” The agency will undergo an evaluation of its processes and examine the source of racial disparities, reconsidering its system for choosing which tax returns to audit.

A study released in 2022, found that the tax agency audited poorer families at five times the rate than everyone else.

“We will work to identify any disparities across dimensions including age, gender, geography, race, and ethnicity as well as continually refining our approaches to compliance and enforcement to improve fairness in tax administration and maintain accountability to taxpayers as informed by our research,” Werfel noted in the letter.


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