Washington ? The Internal Revenue Service has been auditing more high-income taxpayers but may not be effectively going after one of the biggest problems – wealthy people who evade taxes by reporting too little business income or overstating business expenses.

The reason is that IRS auditors most often conduct audits of high-income taxpayers by correspondence, said a report by the Treasury office that oversees the tax collection agency’s operations. In those cases, the IRS sends letters to taxpayers asking them to verify information on their returns.

Fewer audits actually require high-income taxpayers – those reporting $100,000 or more in income – to sit through intensive, face-to-face examinations.

Those audits could turn up more evidence of missing business income or overstated deductions for business expenses, J. Russell George, the Treasury Department’s inspector general for tax administration, said in a new report.

“These types of taxpayers and issues are difficult to examine through correspondence,” the inspector’s report said. By their nature, audits by letter are “less complex and issues are limited” when compared with traditional audits, it added.

The IRS has increased the number of face-to-face audits of wealthier taxpayers over the past few years, even though its budget has remained flat.

Kevin Brown, who leads the IRS small business and self-employed division, agreed that intensive audits find more unreported income. “The observation is correct,” he said. “We don’t think we’re doing enough there, and we want to do more.”

Both types of audits – those by mail and in person – have increased in recent years, reversing a slide in IRS tax law enforcement that started in the 1990s.