According to the IRS, tax compliance isn’t getting any worse. The nation’s tax collector has just released a new set of “tax gap” estimates for the 2006 tax year. (IRS Internal News Release IR-2012-4)
The new report, representing the first full update by the IRS in five years, shows that the nation’s compliance rate is essentially unchanged from its last review.
The percentage of total tax revenues paid on a timely basis for 2006 is estimated to be 83.1% (it was 83.7% for 2001). As it was in 2001, underreporting of income remains the biggest problem. It created an estimated $376 billion shortfall in 2006, up from $285 billion in 2001. Nonfiling accounted for $28 billion in 2006, up from $27 billion in 2001. Underpayment of tax increased to $46 billion, up from $33 billion.
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