America’s anti-poor tax audits, in one infuriating map

You would think that the IRS, in an effort to bring in more money, would focus primarily on auditing wealthy taxpayers. But as ProPublica’s Paul Kiel and Jesse Eisinger found in an incredible, disturbing piece from late last year, recipients of the earned income tax credit (EITC) — one of the US’s biggest anti-poverty programs, aimed almost exclusively at the working poor — were twice as likely to be audited as people earning $200,000 to $500,000.

Now, to drive home this inequity, Kiel and his colleague Hannah Fresques have released a follow-up report, putting together a map of every county in the US by income tax audit rate. And what they found isn’t surprising, but nonetheless still appalling.

The darker counties on the map have higher audit rates — and if you know a bit about US geography, you’ll notice that the audits tend to spike in areas with large black populations, large Latino populations, or Indian reservations.

ProPublica/Paul Kiel and Hannah Fresques

The sociologist Kieran Healy has joked that most data visualization maps of the US show one of two things: population density or the percentage of the population that’s black. This is decidedly one of the latter maps, with the notable additions of heavily Latino counties in southern Texas and Indian reservations in South Dakota and Montana.

Indeed, looking at the opposite map — where audits are less common than average — versus a county-by-county map of the share of the population that identifies as white, one notices a certain resemblance:

Census Bureau

(Note, the map on the right includes white people who identify as Hispanic, which accounts for some of the Texas highlighting happening.)

Kiel and Fresques are working off of data collected by Kim Bloomquist, a former economist at the IRS, who found, as Kiel and Fresques put it, that “Because more than a third of all audits are of EITC recipients, the number of audits in each county is largely a reflection of how many taxpayers there claimed the credit.” In other words: This is mostly a map of low-income taxpayers, and consequently, in large measure, a map of black, Latino, and Native American taxpayers.

The background context for all this is that the IRS has been gutted, budgetarily, since 2010 through successive cuts to “non-defense discretionary” spending, a big, wonky term that includes everything from tax enforcement to the FBI to environmental enforcement to scientific research. This was a remarkably shortsighted policy decision. The National Taxpayer Advocate’s office, a watchdog group in the federal government, has estimated that every $1 in budget cuts to the IRS costs the government about $7 in lost revenue, both from increased erroneous payments and from laxer enforcement of fraud.

Indeed, budget cuts have reduced audit rates across the board. But they’ve fallen less for EITC recipients than they have for millionaires or the near-millionaire wealthy, who have more resources to fight audits. Kiel and Eisinger found that while audits for EITC recipients fell 36 percent from 2011 to 2017, audits for people earning more than $10 million fell 52 percent. Audits for people making $200,000 to $5 million fell by more than 70 percent. The budget cuts’ primary effect was to help the rich get off scot-free while low-income people get audited.

One obvious fix for this would be to increase the IRS’s budget so it can take enforcement seriously again. Another would be to instruct the agency to prioritize high earnings with complex capital income above low-income families claiming EITC so they can afford basic necessities. Neither is likely to happen, given who’s in charge of the Senate and the executive branch.

Sign up for the Future Perfect newsletter. Twice a week, you’ll get a roundup of ideas and solutions for tackling our biggest challenges: improving public health, decreasing human and animal suffering, easing catastrophic risks, and — to put it simply — getting better at doing good.

Will you join us?

Our biggest supporters are our readers — and we’re so grateful to everyone who has made a contribution during our September campaign. We’re less than 1,000 contributions away from reaching our goal for the month, which in turn will allow us to say yes more often when our incredible journalists come to us with questions they want to answer and projects they want to pursue. Will you make a contribution before the month ends and support our policy coverage through 2024 and beyond?

One-Time Monthly Annual

$5/month

$10/month

$25/month

$50/month

Other

$

Yes, I'll give $5/month

Yes, I'll give $5/month

We accept credit card, Apple Pay, and Google Pay. You can also contribute via