IRS Highlights New Business Tax Account Features, FS-2024-27
The IRS announced that it is continuing to expand the features within Business Tax Account (BTA), an online self-service tool […]
Read MoreThe Department of the Treasury estimates that the net tax gap currently stands at $381 billion.
According to the agency’s fiscal year 2021 Financial Report of the U.S. Government, released February 17, the agency estimated the gross tax gap – the difference between the amount of tax imposed by law and what taxpayers actually pay on time – to be $441 billion. It is generally composed of three elements: non-filing ($39 billion), underreporting ($352 billion), and underpayment ($50 billion).
Segmented by tax type, the gross tax gap estimate for individual income tax is $314 billion, followed by employment tax ($81 billion), corporation income tax ($42 billion) and estate and excise tax ($4.5 billion).
That gross amount is lowered by what is estimated will be paid through voluntary payment or collected via Internal Revenue Service administrative and enforcement activities: $60 billion to arrive at a net tax gap of $381 billion.
Individual income tax accounts for the majority of the net tax gap ($271 billion), followed by employment tax ($77 billion), and corporation income tax ($32 billion). The balance is made up of estate and excise tax ($1 billion).
The IRS announced that it is continuing to expand the features within Business Tax Account (BTA), an online self-service tool […]
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