<\/a><\/strong><\/p>\nit\u2019s pretty easy to calculate the tax gap created by wage- and salary-earners. the 1099 supposedly reports all income, and the common deductions are pretty easy to verify with an audit. an under-the-table side hustle might go unreported, but it usually doesn\u2019t amount to much. if it does, inordinate spending can reveal the problem.<\/p>\n
auditing the wealthy, on the other hand, is so difficult that the irs really has little idea how much tax gets dodged. random audit data fails to capture the full extent of evasion. between convoluted shelters, offshore banking, complex partnership structures, cryptocurrencies and hotshot tax preparers \u2013 options unavailable to those of lesser means \u2013 only a sophisticated audit by specialized auditors can come close to finding out what\u2019s truly owed.<\/p>\n
high-income non-filers rising<\/strong><\/p>\nthe treasury inspector general figures that since 2010, the number of high-income non-filers has risen by nearly 50 percent. between 2014 and 2016, out of 900,000 high-income non-filers, 400,000 cases were never investigated. of those 400,000, just 300 cost the government some $10 billion in that two-year period.<\/p>\n
the probable cause of such widespread evasion success was a resource-constrained irs that has been unable to pursue all cases.<\/p>\n
<\/p>\n
if the extent of third-party information reporting is the crucial difference, then the solution, or part of the solution, is obvious: more third-party reporting on income beyond the basic 1099.<\/p>\n
the irs and the government accountability office agree that bolstering information reporting is one of the best ways to increase the overall compliance rate.<\/p>\n
leveraging information<\/strong><\/p>\nfinancial institutions could be a significant part of that reporting. the information could be collected without burdening taxpayers with new reporting requirements. according to the treasury report on the families plan agenda, \u201cleveraging information that financial institutions already collect (could) shed light on those taxpayers who misreport income derived from opaque categories.\u201d<\/p>\n
the report also says:\u00a0\u201cthe president\u2019s proposal requires information reporting on financial accounts to increase the visibility of gross receipts and expenses to the irs. today, business income is subject to limited information reporting. current reporting of gross receipts exists for only certain types of revenue, and there is no information reporting on deductible expenses. this is why the tax gap for partnership, s-corporation and proprietorship income is estimated at around $200 billion annually with the net misreporting percentage for certain income categories exceeding 50 percent.\u201d<\/p>\n
a new reporting regime<\/strong><\/p>\npresident biden is suggesting a new reporting regime built from the framework of form 1099-nt that taxpayers receive on interest earned from a financial institution. the bolstered report would report gross inflows and outflows on all business and personal accounts, with exceptions for accounts below a low de minimus gross flow threshold.<\/p>\n
other reports could include requiring payment settlement entities to report gross receipts and purchases. the regime could also apply to foreign institutions and crypto-asset exchanges and custodians.<\/p>\n
the additional information would effectively relieve many honest taxpayers. no new reconciliations would be required, and the irs could avoid unnecessary audits while better targeting probable transgressors.<\/p>\n
if the plan survives senatorial resistance and becomes law, tax preparers will be back on the learning curve \u2013 the curve that never ends \u2013 but will also be more confident that their clients are providing honest, accurate information.<\/p>\n","protected":false},"excerpt":{"rendered":"
<\/a> \ntax professionals should brace for a new wave of information reporting.<\/strong> \nby 卡塔尔世界杯常规比赛时间 research<\/em><\/p>\n","protected":false},"author":17,"featured_media":85796,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":""},"categories":[2779,3120,3002,1906,2246],"tags":[],"class_list":["post-85593","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-charts-graphs","category-pro-member-exclusive","category-special","category-tax-practice","category-busy-season"],"acf":[],"yoast_head":"\nclosing the tax gap: more data, more compliance? - 卡塔尔世界杯常规比赛时间<\/title>\n \n \n \n \n \n \n \n \n \n \n \n \n \n\t \n\t \n\t \n \n \n \n \n \n\t \n\t \n\t \n