The Wall Street Journal reports the initiative is an attempt to respond to what the agency feels is a widespread failure by small businesses to report all their cash sales.
The agency says the letters are not the same as an audit, and it is simply seeking more tax information from the businesses. However, some lawmakers and business owners who received the letters say the initiative is alarming.
“There’s an emotional thing when you get a pretty ominous-looking letter from the IRS, [saying] you might have done some bad things,” small business owner Tom Reese tells the Wall Street Journal. “I really work hard with my accountant to make sure that I not only follow the law, but follow the letter of the law.”