IRS begins revamping corporate taxpayer audit process

On March 26, the IRS announced that it intends to reduce the amount of resources devoted to large corporate audits (i.e., corporate taxpayers with assets of $1 billion or more), and to redeploy those savings to examinations of flow-throughs, financial products and businesses with either international operations or assets of $250 million or less. This would result in a substantial shift in IRS behavior - in 2010 the IRS audited 96 percent of returns filed by corporations with assets of $20 billion or more, and just 12 percent of businesses with assets of $250 million or less.