Tax News Roundup

Every Saturday, we'll take a look at the top tax stories in the news.

IRS Audits Increase 21%
"During Fiscal Year 2005 the IRS completed more than 1.215 million audits of individuals, up almost 21 percent from last year's figure of 1.008 million," according to the IRS news release accompanying the agency's annual data book. With audits on the increase, you will want to make sure you steer clear of any problems the IRS has on its radar screen. The IRS Hot Topics page where the agency details all its current compliance and enforcement programs.

Another Black Eye for H&R Block
(New York Times Editorial) H&R Block is involved in several legal battles right now. As this editorial makes clear, the financial services industry needs to find ways to make it easy and affordable for people to save for retirement. "But the deeper issue is that people who want to save — and need to save — need more help than they're getting," according to the editorial.

IRS Tax Software Loses Popularity
(Akron Beacon Journal) The Free File program is losing popularity, according to this brief report from the Beacon Journal. Part of the problem is that the Free File participants have set stricter eligibility criteria for this year.

IRS Warns Tax-Season Phishing Scams Back
(Delaware News Journal) If you receive an email claiming to be from the IRS, delete it immediately. The IRS does not contact taxpayers via email, and IRS agents will never ask for highly personal information like your credit card number, ATM pin number, or passwords. The emails are a scam, and they use official-looking logos and fake email addresses to steal people's financial information. If you ever have a question about your taxes, such as Where's Your Refund or the status of a return you mailed in, you can always call the IRS directly at 1-800-829-1040.

Where Your Tax Dollars Go
A talented illustrator "Mibi" has published an informative and appealing chart showing where your federal tax dollars are spent. The chart is titled, "Death and Taxes: A Visual Look at Where Your Tax Dollars Go." Thanks to tax professor Paul Caron for alerting everyone about this chart.