Comparison of the Tax Auditing Process in the United States and Türkiye

Tax auditing serves as a crucial mechanism for ensuring the sustainability of public finance and enhancing tax compliance, prompting governments to develop various methods to prevent tax losses and ensure tax equity. In the United States, tax audits are conducted by the Internal Revenue Service (IRS), with most audits taking the form of correspondence audits aimed at increasing voluntary tax compliance by minimizing disputes between taxpayers and the administration. In Türkiye, tax audits are regulated under the Tax Procedure Law and are conducted by the Tax Inspection Board. The explanatory invitation procedure has been introduced to enhance the effectiveness of tax audits and minimize disputes. This procedure allows taxpayers to provide explanations before facing punitive measures due to potential tax losses, thereby alleviating the administrative burden on the tax authorities. Although Türkiye’s tax audit system incorporates unique practices, the explanatory invitation mechanism structurally resembles the correspondence audit system in the United States. This study compares tax audit processes in Türkiye and the United States, providing a detailed evaluation of the similarities and differences between the audit systems of both countries.