Janet Yellen Vows IRS Audits Won’t Rise for Middle-Income Americans, but There’s a Catch

Treasury Secretary Janet Yellen vowed on Wednesday that Internal Revenue Service (IRS) audit rates for Americans earning less than $400,000 per year would not increase — at least according to “historical levels,” which are far higher than current levels.

The Biden administration official’s promise comes as the Inflation Reduction Act — a $740 billion proposal that includes $80 billion for the IRS to hire 87,000 more employees — advances through Congress. In a letter to IRS Commissioner Charles Rettig, Yellen argued that the funding would help the IRS “improve taxpayer service” and “increase equity in the tax system” rather than allow the agency to target middle-income Americans.

“I direct that any additional resources — including any new personnel or auditors that are hired — shall not be used to increase the share of small business or households below the $400,000 threshold that are audited relative to historical levels,” Yellen told Rettig. “This means that, contrary to the misinformation from opponents of this legislation, small business or households earning $400,000 per year or less will not see an increase in the chances that they are audited.”