The IRS says that the total taxes paid in 2006 was lower by a massive $450 billion compared to what was supposed to have been paid. That comes up to an underpayment of about 17%. 2006 is the latest year for which the IRS has gathered such statistics. The shortfall in taxes far exceeded the size of the entire federal budget deficit that year, which was $248 billion. However, this amount was reduced to about $385 billion or 14% after audits and other collection efforts were carried out. This still exceeded the budget deficit, meaning that if the shortfall was actually collected, the budget would have shown a surplus instead of a deficit for 2006.
This figure brought about an immediate reaction from lawmakers who spoke up about the need to revise the tax code to reduce the “tax gap”, the term commonly used to refer to the difference in the amount of taxes that should have been collected and the amount actually collected. Michelle Dimarob (R Mich), spokeswoman for House Ways and Means Committee Chairman Dave Camp said, “The best way to increase compliance is to reform the tax code to make it simpler”. In Dimarob’s opinion, such a move would cause fewer errors and “greater certainty, which is key to job creation.”
Please see full article below for more information.
Firefox recommends the PDF Plugin for Mac OS X for viewing PDF documents in your browser.
We can also show you Legal Updates using the Google Viewer; however, you will need to be logged into Google Docs to view them.
Please choose one of the above to proceed!
LOADING PDF: If there are any problems, click here to download the file.
Tax Law Updates
DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
© Darrin Mish, Tampa Tax Attorney, The Law Offices of Darrin Mish, P.A. | Attorney Advertising