Even if the IRS "profits" from spending $1B to collect $2B, that's a 50% processing fee on that incoming money, halving the efficiency of that marginal dollar. If that's still worth collecting, it's better to raise taxes. Really the appropriate stopping point in IRS funding has little to do with whether one of these numbers is close to another.

> We're not there, though.

I suspect that's true, but you don't actually know that from this dataset. Some portion of the cost is born by the auditee to respond/defend against the audit and passed on to shareholders/employees/customers.

If the response costs are great with respect to the IRS's audit costs, the government could quite profitably add auditors, but have a negative overall impact on end citizens.