The IRS audits a small share of the returns it receives. For tax year 2022, the most recent year covered by the IRS Data Book, the audit rate for individual income tax returns was 0.2% — about 2 in every 1,000 returns.1Internal Revenue Service. IRS Data Book, 20242Internal Revenue Service. Compliance Presence3Internal Revenue Service. National Taxpayer Advocate Annual Report to Congress So how many tax returns are audited each year comes down to roughly half a million individual returns, with your personal odds depending heavily on what you earn and how you earn it.
Total audits have fallen sharply since 2010. Budget cuts, hiring freezes, and a shrinking pool of experienced revenue agents have forced the IRS to be selective. Rather than casting a wide net, the agency concentrates on returns where an examination is most likely to change the tax owed.
Audit Rates by Income Level
Your chance of being audited depends heavily on the income reported on your return. Examination rates by total positive income for tax year 2022 look like this:1Internal Revenue Service. IRS Data Book, 2024
- No positive income: 0.3%
- $1 to $25,000: 0.4%
- $25,000 to $50,000: 0.2%
- $50,000 to $200,000: 0.1%
- $200,000 to $500,000: 0.1%
- $500,000 to $1 million: 0.6%
- $1 million to $5 million: 1.1%
- $5 million to $10 million: 3.1%
- $10 million or more: 4.0%
Middle-income earners between $50,000 and $500,000 have the lowest audit rate at 0.1%. Scrutiny climbs steeply above $1 million. Filers reporting $10 million or more face an audit rate 20 times the national average, reflecting the larger potential tax adjustments that complex, high-dollar returns tend to produce.
Why Low-Income Returns Are Audited More Often Than Middle-Income Ones
The $1-to-$25,000 bracket sits at 0.4%, higher than brackets earning several times as much. The reason is the Earned Income Tax Credit. Many filers in that range claim the EITC, a refundable credit the IRS treats as a high-priority compliance area.4Office of the Law Revision Counsel. 26 U.S. Code 32 – Earned Income Most of these examinations are low-cost correspondence audits that verify qualifying children and filing status rather than deep dives into business income.5Taxpayer Advocate Service. Correspondence Audits: Low-Income Taxpayers They are cheap to run and easy to close, which is part of why the volume is what it is.
Self-Employed Filers
If you report business income on Schedule C, your audit risk runs higher than the average for your income bracket. Self-employed taxpayers have historically been audited at roughly 1.5%, several times the overall individual rate. Cash-based businesses, large deductions relative to revenue, and mixed personal and business expenses all create the kind of underreporting risk the IRS looks for.
How Those Audits Are Actually Conducted
When people picture an audit, they picture an agent at the kitchen table. That is not what most audits look like. About 78% of individual audits closed in fiscal year 2024 were handled entirely by mail.1Internal Revenue Service. IRS Data Book, 2024 In a correspondence audit, the IRS sends a letter asking you to verify one or two specific items, often a charitable deduction, an education credit, or EITC eligibility, and you respond by mailing supporting documents.6Internal Revenue Service. IRS Audits
The remaining 22% are field examinations, where a revenue agent visits your home, business, or representative’s office for an in-depth review.1Internal Revenue Service. IRS Data Book, 2024 Field audits generally involve higher-income returns, business entities, and situations that span multiple years or complex transactions.
Separately, the IRS runs an automated matching program that compares income you reported against W-2s, 1099s, and other third-party documents. When it finds a mismatch, it generates a CP2000 notice under the Automated Underreporter program.7Internal Revenue Service. IMF Automated Underreporter Program These notices are not counted as audits in the figures above, but they function similarly for the taxpayer who receives one, and they operate independently of examiner staffing.
Why the Numbers Are Where They Are
Audit totals track directly with how many examiners the IRS can put to work. Two developments in recent years have pulled that number in opposite directions.
Inflation Reduction Act Funding
The 2022 Inflation Reduction Act originally allocated roughly $80 billion over ten years to the IRS, with about $46 billion earmarked for enforcement: hiring new revenue agents, upgrading data analytics, and expanding audits of high-income and corporate taxpayers. Congress subsequently rescinded the vast majority of that enforcement funding through a series of legislative deals before it could be spent. The enforcement account has been reduced by more than 90%.
2025 Workforce Reductions
Starting in early 2025, the IRS lost a large share of its auditing workforce through probationary employee terminations and a deferred resignation program. By March 2025, the agency had lost approximately 3,600 revenue agents, about 31% of its auditing workforce.3Internal Revenue Service. National Taxpayer Advocate Annual Report to Congress The unit responsible for auditing the wealthiest taxpayers lost an even higher share. The cuts fell heavily on experienced examiners who handled the most complex, high-dollar cases.
The practical effect is that overall audit rates, already at historic lows, are unlikely to rise meaningfully in the near term. For high-income filers and large corporations, the reduced examiner workforce may temporarily lower the odds of a complex field audit. Automated document matching, however, does not depend on staffing, so mismatched-income notices will keep going out regardless.
Corporate Audit Rates
The figures above cover individual returns. Businesses face a different landscape. The IRS has historically audited large corporations at significantly higher rates than individuals. In 2019, corporations with assets over $250 million were audited at a rate of 8.8%. The IRS announced plans to nearly triple that rate to 22.6% by 2026, though the staffing losses since early 2025 have cast doubt on whether the agency can meet that target. Smaller businesses organized as pass-through entities — S corporations and partnerships — generally see audit rates closer to the low individual rates, with losses or unusually high deductions drawing more attention.
Put together, the annual audit picture is a small overall number driven by a shrinking examiner workforce, a heavy tilt toward the top of the income distribution, an EITC-driven bump at the bottom, and a large volume of mail-based examinations that never involve an in-person meeting.