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How do IRS Resources Affect the Corporate Audit Process?
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| Zeitschriftentitel: | The Accounting Review |
|---|---|
| Personen und Körperschaften: | , , , |
| In: | The Accounting Review, 95, 2020, 2, S. 311-338 |
| Format: | E-Article |
| Sprache: | Englisch |
| veröffentlicht: |
American Accounting Association
|
| Schlagwörter: |
| author_facet |
Nessa, Michelle Schwab, Casey M Stomberg, Bridget Towery, Erin M. Nessa, Michelle Schwab, Casey M Stomberg, Bridget Towery, Erin M. |
|---|---|
| author |
Nessa, Michelle Schwab, Casey M Stomberg, Bridget Towery, Erin M. |
| spellingShingle |
Nessa, Michelle Schwab, Casey M Stomberg, Bridget Towery, Erin M. The Accounting Review How do IRS Resources Affect the Corporate Audit Process? Economics and Econometrics Finance Accounting |
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nessa, michelle |
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Nessa, Michelle Schwab, Casey M Stomberg, Bridget Towery, Erin M. 0001-4826 1558-7967 American Accounting Association Economics and Econometrics Finance Accounting http://dx.doi.org/10.2308/accr-52520 <jats:title>ABSTRACT</jats:title><jats:p>This study investigates how Internal Revenue Service resources affect the IRS audit process for publicly traded corporations. Using confidential IRS audit data, we examine the effect of IRS resources on the incidence and magnitude of proposed deficiencies and settlement outcomes. We find that IRS resources are positively associated with both the likelihood and magnitude of proposed deficiencies, but negatively associated with the proportion of proposed deficiencies collected. These results are consistent with the IRS focusing on fewer positions, but targeting positions supported by weaker taxpayer facts when resources are more limited. Based on our findings, we estimate the loss in tax collections from audits of LB&I corporate tax returns alone exceeds the savings from reductions in the IRS enforcement budget. This study contributes to the literature examining the strategic game between tax authorities and corporate taxpayers and has important implications for policymakers, particularly in light of recent IRS budget cuts.</jats:p> How do IRS Resources Affect the Corporate Audit Process? The Accounting Review |
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| title |
How do IRS Resources Affect the Corporate Audit Process? |
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How do IRS Resources Affect the Corporate Audit Process? |
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How do IRS Resources Affect the Corporate Audit Process? |
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How do IRS Resources Affect the Corporate Audit Process? |
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How do IRS Resources Affect the Corporate Audit Process? |
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How do IRS Resources Affect the Corporate Audit Process? |
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how do irs resources affect the corporate audit process? |
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Economics and Econometrics Finance Accounting |
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http://dx.doi.org/10.2308/accr-52520 |
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2020 |
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311-338 |
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<jats:title>ABSTRACT</jats:title><jats:p>This study investigates how Internal Revenue Service resources affect the IRS audit process for publicly traded corporations. Using confidential IRS audit data, we examine the effect of IRS resources on the incidence and magnitude of proposed deficiencies and settlement outcomes. We find that IRS resources are positively associated with both the likelihood and magnitude of proposed deficiencies, but negatively associated with the proportion of proposed deficiencies collected. These results are consistent with the IRS focusing on fewer positions, but targeting positions supported by weaker taxpayer facts when resources are more limited. Based on our findings, we estimate the loss in tax collections from audits of LB&I corporate tax returns alone exceeds the savings from reductions in the IRS enforcement budget. This study contributes to the literature examining the strategic game between tax authorities and corporate taxpayers and has important implications for policymakers, particularly in light of recent IRS budget cuts.</jats:p> |
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| author | Nessa, Michelle, Schwab, Casey M, Stomberg, Bridget, Towery, Erin M. |
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| description | <jats:title>ABSTRACT</jats:title><jats:p>This study investigates how Internal Revenue Service resources affect the IRS audit process for publicly traded corporations. Using confidential IRS audit data, we examine the effect of IRS resources on the incidence and magnitude of proposed deficiencies and settlement outcomes. We find that IRS resources are positively associated with both the likelihood and magnitude of proposed deficiencies, but negatively associated with the proportion of proposed deficiencies collected. These results are consistent with the IRS focusing on fewer positions, but targeting positions supported by weaker taxpayer facts when resources are more limited. Based on our findings, we estimate the loss in tax collections from audits of LB&I corporate tax returns alone exceeds the savings from reductions in the IRS enforcement budget. This study contributes to the literature examining the strategic game between tax authorities and corporate taxpayers and has important implications for policymakers, particularly in light of recent IRS budget cuts.</jats:p> |
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| spelling | Nessa, Michelle Schwab, Casey M Stomberg, Bridget Towery, Erin M. 0001-4826 1558-7967 American Accounting Association Economics and Econometrics Finance Accounting http://dx.doi.org/10.2308/accr-52520 <jats:title>ABSTRACT</jats:title><jats:p>This study investigates how Internal Revenue Service resources affect the IRS audit process for publicly traded corporations. Using confidential IRS audit data, we examine the effect of IRS resources on the incidence and magnitude of proposed deficiencies and settlement outcomes. We find that IRS resources are positively associated with both the likelihood and magnitude of proposed deficiencies, but negatively associated with the proportion of proposed deficiencies collected. These results are consistent with the IRS focusing on fewer positions, but targeting positions supported by weaker taxpayer facts when resources are more limited. Based on our findings, we estimate the loss in tax collections from audits of LB&I corporate tax returns alone exceeds the savings from reductions in the IRS enforcement budget. This study contributes to the literature examining the strategic game between tax authorities and corporate taxpayers and has important implications for policymakers, particularly in light of recent IRS budget cuts.</jats:p> How do IRS Resources Affect the Corporate Audit Process? The Accounting Review |
| spellingShingle | Nessa, Michelle, Schwab, Casey M, Stomberg, Bridget, Towery, Erin M., The Accounting Review, How do IRS Resources Affect the Corporate Audit Process?, Economics and Econometrics, Finance, Accounting |
| title | How do IRS Resources Affect the Corporate Audit Process? |
| title_full | How do IRS Resources Affect the Corporate Audit Process? |
| title_fullStr | How do IRS Resources Affect the Corporate Audit Process? |
| title_full_unstemmed | How do IRS Resources Affect the Corporate Audit Process? |
| title_short | How do IRS Resources Affect the Corporate Audit Process? |
| title_sort | how do irs resources affect the corporate audit process? |
| title_unstemmed | How do IRS Resources Affect the Corporate Audit Process? |
| topic | Economics and Econometrics, Finance, Accounting |
| url | http://dx.doi.org/10.2308/accr-52520 |