CHARTS & GRAPHS

Closing the Tax Gap: More Data, More Compliance?

Tax professionals should brace for a new wave of information reporting.

Misreporting by Income Category: The staggering difference in the tax gaps left by workers with income subject to information reporting and withholding compared to those with income subject to little or no information reporting – less than $10 billion compared with more than $150 billion. (via U.S. Department of Treasury)

By CPA Trendlines Research

Here’s something the IRS has discovered and many tax preparers can probably confirm: While roughly 99 percent of taxes due on wages are paid to the IRS, compliance on less visible sources of income is estimated to be just 45 percent.

MORE: How Charlatans, Creeps, and Ghosts Plague the Tax Profession | Grappling with the Tax Gap | Wealthiest Taxpayers Cheat IRS Out of $400 Billion a Year | 173% Increase in IRS Correspondence Backlog | Hunker Down: The IRS Backlog Isn’t Going Away Anytime Soon | The IRS Studebaker Bomb | Imagine IRS ‘Concierge’ Service. Just Imagine. | IRS Has Recruiting Problems, Too
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Yes, it seems that Americans are more willing to pay what they owe when the IRS knows they owe it.