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pwaldo
01-09-2012, 05:19 PM
http://finance.yahoo.com/news/irs-estimate-17-percent-taxes-204637410.html


People and businesses underpaid their taxes by an estimated 17 percent in the most recent year studied, failing to send the government a massive $450 billion that it was owed, according to an Internal Revenue Service report released Friday.

The study covered 2006, the most recent data the IRS said was available. The amount of underpaid taxes far exceeded the size of the entire federal budget deficit at the time.

After IRS audits and other enforcement efforts, non-compliance in 2006 shrank to 14 percent. That left the final amount of unpaid taxes at $385 billion, the agency said.

Friday's report immediately became fodder for lawmakers arguing that any effort to overhaul the tax code which seems a long-shot in an election year must include closing the gap between what is owed and actually paid.

"The best way to increase compliance is to reform the tax code to make it simpler," said Michelle Dimarob, spokeswoman for House Ways and Means Committee Chairman Dave Camp, R-Mich. She said that would cause fewer errors and "greater certainty, which is key to job creation."

Star_Cards
01-09-2012, 05:27 PM
I wonder if the Fair tax would get them at a much closer rate of taxes paid than they have now. Seems like it would but not sure.

tsjct
01-09-2012, 10:26 PM
The problem here is that Most of the unpaid is by the Very Very wealthy that do not make a salary but get paid in Distributions, Dividends, or Stock gains and they move the money out of the country fast. This will always be a problem and going to be really hard to stop. Kinda like Warren Buffet calling for a raise in taxes but FILED a lawsuit against the government this year for overtaxing a business he owns. Its all a mess.

pghin08
01-09-2012, 11:32 PM
The problem here is that Most of the unpaid is by the Very Very wealthy that do not make a salary but get paid in Distributions, Dividends, or Stock gains and they move the money out of the country fast. This will always be a problem and going to be really hard to stop. Kinda like Warren Buffet calling for a raise in taxes but FILED a lawsuit against the government this year for overtaxing a business he owns. Its all a mess.

+1. Cap Gains tax is 15%, which is basically the lowest it's ever been.

AUTaxMan
01-10-2012, 11:23 AM
The problem here is that Most of the unpaid is by the Very Very wealthy that do not make a salary but get paid in Distributions, Dividends, or Stock gains and they move the money out of the country fast. This will always be a problem and going to be really hard to stop. Kinda like Warren Buffet calling for a raise in taxes but FILED a lawsuit against the government this year for overtaxing a business he owns. Its all a mess.

That might be perception, but I'm not entirely sure it is reality. I doubt the rate of tax has anything to do with the tax gap. In fact, I would be willing to bet that the uber wealthy have a higher tax compliance percentage than average, because they stand to lose much more than the Average Joe if they get caught defrauding the IRS. In a voluntary reporting system, you are always going to have a substantial tax gap. If they truly want to reduce the gap, they should move to a national sales tax like the fairtax.

Star_Cards
01-10-2012, 11:47 AM
it seems to me that a national sales tax would be way easier for them to monitor. In the fair tax, they would monitor retailers of new goods and not have to worry about regular individuals outside of the monthly prebates for the most part. all of the missed or dodged taxes by under the table stuff like criminal money making, gambling, ebay, illegal emigrant or just plain old under the table employment, and so on would eventually get taxed.

mrveggieman
01-10-2012, 11:53 AM
I'm starting to think the tax system has nothing to do with gov't revenue but everything to to with the gov't being all up in your financial business. SMH.

Star_Cards
01-10-2012, 04:38 PM
^ I believe the same.

tsjct
01-11-2012, 05:47 PM
I'm starting to think the tax system has nothing to do with gov't revenue but everything to to with the gov't being all up in your financial business. SMH.

Exactly! Just like the IRS making paypal/Ebay report any one taking in payments over 20K per year. They are going to be in for a SHOCK when they see all the losses people report. They do not realize this is a HOBBY that most people lose money on every year. They thought this would bring in revenue but i think it will cost them. I know i wrote off a ton in loses this year. I am a small player but they will add up.