Business Notes

Prisoners have been given charge in their own prisons, and condemned men forced to dig their own graves. Now the Internal Revenue Service is asking U.S. taxpayers to audit their own returns. In an experimental program, the IRS will send letters to 2,000 taxpayers in New England and upstate New York with incomes between $50,000 and $100,000, asking them to correct suspected errors on their 1989 returns.

The letters will point out items the IRS questions. If you'd rather not audit yourself, the IRS will conduct a regular audit. If you find you erred, you're supposed to report it and pay the appropriate penalty and interest. And if you conclude that you're in the right, try to persuade the IRS.

If the experiment works, next year the IRS may ask filers to do self-audits without telling them which items are being questioned. The bottom line is saving money: if people are as hard on themselves as the IRS is, paying agents to go after them doesn't make much sense.