In the Headlines
September 21, 2023

Real-Time Partnership Audits Would Give IRS Trove of Data


Tax attorney Mary McNulty spoke with Law360 about the IRS' potential new real-time audit program for partnerships. The agency recently asked for feedback on a compliance assurance process (CAP) program for partnerships. Under this program, similar to an existing one for large corporations, partnerships would work with the IRS to resolve issues before filing tax returns. Industry professionals commented that through the program, the IRS could gain access to information that would help it better understand large partnerships and thus more effectively increase enforcement against them. Ms. McNulty added that the artificial intelligence (AI) technology currently being used to gather data when choosing partnerships for audits could also help with selecting candidates for the CAP program.

"It's a first step to try to target the partnerships that most warrant the IRS' attention and their resources," she said. "If they have the data right now to figure out who they want to focus their resources on for audits, I would think that could also help them with CAP."

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