--- title: 'Black Taxpayers Are Audited 3 Times More Often Than Other Taxpayers: Study' description: A collaboration between Stanford analysts and the Treasury Department found IRS audit decisions disproportionately target Black Americans. authors: - name: Mary Ellen Cagnassola role: Reporter url: https://money.com/author/mary-ellen-cagnassola/ bio: Mary Ellen (M.E.) Cagnassola is a former reporter at Money, where she covered Social Security, retirement, housing, and employment. Her work reflects her commitment to service and equity in consumer finance. education: Rutgers University, BA Journalism at_money_since: 2021 articles: 205 covers: - Taxes - Banking - Business - Career Advice - Credit - Credit Cards - Economy and Politics - Education - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Pets - Professional Services - Retirement - Shopping former_staff: true editors: - name: Julia Glum role: Managing Editor url: https://money.com/author/julia-glum/ bio: A graduate of the University of Florida, Julia has more than eight years of experience in personal finance journalism. In addition to overseeing news and newsletters, she leads Money’s tax coverage, which includes extensive reporting on tax credits, policy changes and the IRS. education: University of Florida at_money_since: 2018 articles: 453 covers: - Taxes - Banking - Business - Career Advice - Credit - Credit Cards - Debt - Economy and Politics - Education - Health and Wellness - Housing - Identity Theft - Insurance - Investing - Lifestyle - Loans - Mortgages - Personal Finance - Professional Services - Retirement - Shopping - Technology also_seen_in: - Newsweek - International Business Times - CBS News - Good Morning America - WUSA9 - Pix 11 - The New York Times - Mashable - The Washington Post - CNBC - Politico social: - https://x.com/superjulia - https://www.linkedin.com/in/julia-glum published: '2023-02-02T17:39:14.000Z' modified: '2024-01-10T17:49:13.000Z' section: Taxes tags: - News - Taxes word_count: 370 canonical: https://money.com/black-taxpayers-audited-more/ type: NewsArticle source: structured-blocks --- > **Disclosure:** We research all brands listed and may earn a fee from our partners. Research and financial considerations may influence how brands are displayed. Not all brands are included. [Learn more](https://money.com/page/disclaimer/). ![Couple looking through multiple receipts with a worried look](https://img.money.com/2023/01/News-IRS-Likely-Audit-By-Race.jpg) Long-held suspicions among scholars about racial disparities in the way the IRS uses its [audit](https://money.com/irs-audits-millionaires-low-income/) authority were confirmed this week by a group of researchers who found Black taxpayers are disproportionately targeted by the agency's enforcement arm. A [Stanford University study](https://law.stanford.edu/press/irs-disproportionately-audits-black-taxpayers/) released last month found that Black taxpayers are at least 2.9 times more likely to be audited as non-Black taxpayers. Secrecy surrounding tax returns and the IRS’s audit decisions make racial bias hard to assess, but new policies ushered in by the Biden administration now require agencies to review data concerning their programs’ impact on equity. ## What the research says - Economists at the U.S. Treasury Department teamed up with Stanford analysts to analyze more than 148 million tax returns and 780,000 [audits](https://money.com/taxes-getting-audited-irs-2020/) from 2014. - Because tax returns don’t require taxpayers to disclose their racial or ethnic identity, the team used first, name, last name and geography to predict whether a given taxpayer was Black. - The results showed Black Americans received IRS audits 2.9 to 4.7 times more often than non-Black taxpayers. - The earned income tax credit (EITC) plays a major role in the disparities: [Low-income](https://money.com/search/?q=audit) people who claim the EITC are also more likely to be the target of IRS audits. Black taxpayers accounted for 21% of overall EITC claims but were the focus of 43% of EITC audits. ## The takeaway According to Daniel E. Ho, one of the study’s authors, racial inequity in how the IRS makes audit decisions is probably unintentional. Instead, audit selection is determined by an undisclosed algorithm. So what can [the IRS](https://money.com/irs-funding-higher-taxes-more-audits/) can do to correct bias? - Using alternative audit selection policies, researchers concluded that changes to the IRS’s algorithm can reduce its racial impact. - Recommendations from the research team include predicting and focusing on the magnitude of taxpayers’ underreported income as opposed to only its likelihood. “The IRS should drill down to understand and modify its existing audit selection methods to mitigate the disparity we’ve documented,” Ho said in a news release. ```json { "@context": "https://schema.org", "@graph": [ { "@type": "BreadcrumbList", "@id": "https://money.com/black-taxpayers-audited-more/#breadcrumb", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://money.com" }, { "@type": "ListItem", "position": 2, "name": "Taxes", "item": "https://money.com/taxes/" }, { "@type": "ListItem", "position": 3, "name": "Tax Returns", "item": "https://money.com/tax-returns/" }, { "@type": "ListItem", "position": 4, "name": "Black Taxpayers Are Audited 3 Times More Often Than Other Taxpayers: Study" } ] }, { "@type": "WebSite", "@id": "https://money.com/#website", "url": "https://money.com", "name": "Money", "publisher": { "@id": "https://money.com/#organization" } }, { "@type": "WebPage", "@id": "https://money.com/black-taxpayers-audited-more/#webpage", "url": "https://money.com/black-taxpayers-audited-more/", "name": "Black Taxpayers Are Audited 3 Times More Often Than Other Taxpayers: Study", "isPartOf": { "@id": "https://money.com/#website" }, "datePublished": "2023-02-02T17:39:14.000Z", "mainEntity": { "@id": "https://money.com/black-taxpayers-audited-more/" }, "inLanguage": "en-US", "breadcrumb": { "@id": "https://money.com/black-taxpayers-audited-more/#breadcrumb" }, "dateModified": "2024-01-10T17:49:13.000Z" }, { "@type": "NewsArticle", "headline": "Black Taxpayers Are Audited 3 Times More Often Than Other Taxpayers: Study", "articleSection": "Taxes", "image": [ { "@type": "ImageObject", "url": "https://img.money.com/2023/01/News-IRS-Likely-Audit-By-Race.jpg", "width": 5850, "height": 3676, "caption": "News-IRS-Likely-Audit-By-Race" } ], "author": [ { "@type": "Person", "name": "Mary Ellen Cagnassola", "url": "https://money.com/author/mary-ellen-cagnassola/", "@id": "https://money.com/author/mary-ellen-cagnassola/#author", "description": "Mary Ellen (M.E.) 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