While much of the U.S. payroll is under deficit reduction pressure, personnel in the nation's tax-collection operation increased by 19% from 2006 through 2010, with half of that hiring coming in 2010 alone. The increase apparently has paid off; IRS enforcement revenue increased by 18% last fiscal year alone, to $57.6 billion, according to the office of the Treasury Inspector General for Tax Administration, or Tigta.
"Increased staffing has led to increased revenues for the service," Sharon Katz-Pearlman, national principal-in-charge of KPMG's Tax Controversy Services Network, said in this week. "The new type of agent they are bringing in has a substantial amount of outside experience."
These new agents are spending much of their time on middle-market companies. According to Tigta, while fiscal 2010 saw an overall 5% increase in corporate examinations, companies with assets of $10 million or greater have undergone 7% more examinations. For companies worth at least $250 million, that figure is 9%.
"Middle market companies that are historically not subject to examination are coming under examination," said Katz-Pearlman. "More agents are out there working on cases that are not large cases."