Final answer:
If an audit reveals an individual has underpaid taxes, the auditor can assess civil fines, penalties, and potentially refer the case to the Criminal Investigation Division. Auditors have a crucial role in identifying tax discrepancies and can escalate serious offenses for criminal investigation.
Step-by-step explanation:
If an audit reveals that an individual has underpaid his or her taxes, the auditor: d) all the above. This includes the ability to assess civil fines and penalties, as well as the authority to refer the case to the Criminal Investigation Division if there is a suspicion of tax evasion or fraud. The Internal Revenue Service (IRS) is the main federal agency responsible for tax collection and tax law enforcement. While individual auditors may not directly impose criminal sanctions, they play a pivotal role by identifying discrepancies and potential violations that may have occurred. For serious offenses, a case can be escalated beyond civil penalties to involve criminal investigation, potentially leading to prosecution.
Ever-present in the assessment and enforcement of taxes is the role of politics, which can influence tax laws and the administrative approaches of agencies like the IRS. While every citizen is obliged to comply with tax regulations, effective tax administration also requires the tax system to be viewed as fair and for citizens to believe that their contributions are being used responsibly by the government.