IDEAS home Printed from https://ideas.repec.org/a/kap/itaxpf/v32y2025i4d10.1007_s10797-024-09866-5.html
   My bibliography  Save this article

The specific indirect effect of IRS audits

Author

Listed:
  • Jess Grana

    (The MITRE Corporation)

  • India Lindsay

    (The MITRE Corporation)

  • Lucia Lykke

    (The MITRE Corporation)

  • Max McGill

    (The MITRE Corporation)

  • Alexander McGlothlin

    (The MITRE Corporation)

  • Leigh Nicholl

    (Indeed, Austin Indeed Tower (HQ))

  • Alan Plumley

    (Internal Revenue Service)

Abstract

Tax enforcement actions have a direct revenue effect in the form of tax collected from (or refunded to) the contacted taxpayer. These enforcement actions also have an indirect effect on revenues by inducing a change in the future tax reporting of the contacted taxpayer (the “specific” indirect effect) and of the general population (the “general” indirect effect). This paper provides estimates of the specific indirect effect for five types of IRS audits conducted by mail. We use longitudinal taxpayer data from the IRS on operational audits conducted on tax returns filed during Tax Years 2013–2017. We demonstrate that the specific indirect effect varies by audit category, and that in conjunction with the direct effect, should be used to allocate resources within an audit program. To our knowledge, this is the first study in the U.S. tax enforcement context that explicitly aligns specific indirect effect estimates with actual operational audits to identify how the overall return on enforcement resources may be maximized.

Suggested Citation

  • Jess Grana & India Lindsay & Lucia Lykke & Max McGill & Alexander McGlothlin & Leigh Nicholl & Alan Plumley, 2025. "The specific indirect effect of IRS audits," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 32(4), pages 995-1029, August.
    • Handle: RePEc:kap:itaxpf:v:32:y:2025:i:4:d:10.1007_s10797-024-09866-5
    DOI: 10.1007/s10797-024-09866-5
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10797-024-09866-5
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10797-024-09866-5?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:itaxpf:v:32:y:2025:i:4:d:10.1007_s10797-024-09866-5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.