Tax Insight

IRS enforcement trends, audit readiness, and new electronic payment requirements for individuals and family offices

Insight
5 minute read
March 24, 2026

What happened?

The IRS is experiencing significant changes due to proposed funding cuts, operational challenges, and evolving enforcement priorities that may affect high-net-worth individuals and family offices. Audit activity remains focused on high-wealth individuals and complex entities, while being in the early stages of using artificial intelligence for audit selection. Additionally, the IRS is transitioning to fully electronic payments pursuant to Executive Order 14247. Individuals and trusts who historically have remitted payments to the IRS via check will need to explore alternative electronic payment methods once the mandate fully goes into effect.

Why is it relevant?

These developments could signal a more targeted enforcement approach, with the IRS concentrating limited resources on high-dollar, high-visibility cases. Additionally, the shift to electronic payments introduces practical challenges for taxpayers making large payments and requires adaptation to new systems and limitations. Operational delays, increased erroneous notices, and evolving documentation requirements heighten the need for proactive compliance and audit readiness.

Actions to consider

Taxpayers should enhance audit readiness by maintaining contemporaneous documentation and “audit-ready” files. Individuals and family offices also should review electronic payment options considering the new electronic payment mandate and plan for multi-day remittances, if necessary, to the extent payments greater than or equal to $10 million need to be made. Practitioners should monitor IRS communications, document all interactions, and be prepared to escalate issues through secure channels to address delays or erroneous notices.