IRS Launches Pass-Through Compliance Unit

Published: Oct 23, 2024

The IRS launched a new Pass-Through Unit to audit partnerships, trusts, and S corps. This unit will focus on complex, high-wealth entities and aims to improve exam efficiency and taxpayer experience.

 

The IRS announced on Oct. 22, 2024, that the new Pass-Through Unit has started operations. The new unit will audit partnerships, trusts and S corporations of all sizes and will be part of the Large Business & International (LB&I) Division. 

 

Commissioner Danny Werfel said, “…we will be able to reverse our historically low audit rates for complex arrangements employed by certain high-wealth individuals and large entities, while at the same time improving the taxpayer experience through a more tailored exam approach.” 

 

The announcement also included the disclosure that the IRS has “…launched examinations of 76 of the largest partnerships with average assets over $10 billion that includes hedge funds, real estate investment partnerships, publicly traded partnerships, large law firms and many other industries.” 

 

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