IRS tax armoury expanded

New powers and additional funding are to be given to the US Internal Revenue
Service so that it will be better equipped to fight tax cheats.

Lawmakers from the Republicans and Democrats were both eager to expand the
IRS’s armoury, the Wall Street Journal reports.

The IRS faces congressional pressure to narrow the nation’s $290bn (£148bn)
annual tax gap and politicians are eager to squeeze money out of those who
should be paying more rather than raising taxes in an election year.

One new power on the cards will require brokers and traders to declare the
prices investors pay for securities. It is hoped that this policy will enhance
capital gains tax compliance.

The IRS has recently focused its efforts on people earning $100,000 or more.
The revenue authority has seen the number of audits in the million-dollar plus
group climb 84% in 2007 from the prior year.

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