Exhibit 1 Average Annual Federal Tax Gap 2008-2010 (dollars in billions) Tax Gap Individual Employment Corporate Estate & Total Income Income Exercise Underreporting $264 $81 $41 $1 $387 Underpayment 29 6 3 1 39
Nonfiler 26 4 -- 2 32 Gross Tax Gap 319 91 44 4 458 Enforcement (28) (12) (9) (3) (52) Net Tax Gap 291 79 35 1 406 Source: IRS, Federal Tax Compliance Research: Tax Cap Estimates for Tax Years 2008-2010 Exhibit 2 Individual Income Tax Underreporting by Source (dollars in billions) Income Subject To Gross Underreported Tax Gap Tax Gap Little or no information reporting $136 51.
7166, a candidate who fails to file his or her Soce within the prescribed period, whether as a late filer or as a
nonfiler, will be fined and/or barred from 'enter[ing] upon the duties of his office until he has filed' the required Soce.
In order to encourage filing of Income Tax returns, it is proposed that an advance tax at 3% of turnover of
nonfiler service providers be collected by provincial ST authorities along with their sales tax returns.
Estimates of nonreported income will be updated using newly available data from the Census Bureau's "exact-match" studies, which compare records from the CPS with individual IRS tax returns to estimate
nonfiler income for individuals.
The IRS identifies a
nonfiler as a person who fails to submit a tax return even though a third party has filed an earnings statement (W-2) or information return reporting interest or dividends (Form 1099) that shows the person received income during the year.
If you are a
nonfiler, go directly your nearest tax professional and file tax returns with the Internal Revenue Service voluntarily.
Similarly, a city business may be an active corporation tax filer but may be a
nonfiler for the city's commercial rent tax.
Compliance 2000 combines traditional enforcement efforts with other initiatives, such as taxpayer outreach and education programs, Market Segment Understandings, Audit Technique Guides, Advanced Pricing Agreements, and our
Nonfiler Program.
For details on the TCMP, see Karla Daronco,
Nonfiler Profiles, Processing Year 1991, I.
The Internal Revenue Service's
Nonfiler Initiative announced in 1992 has brought about a substantial increase in the filing of delinquent returns.
The IRS told TIGTA in January that it was testing a
nonfiler notification system and hoped to have the system ready for use this spring.
Under the law, a candidate who fails to file his or her Soce within the prescribed period, whether as a late filer or a
nonfiler, will be fined and/or barred from enter[ing] upon the duties of his office until he has filed the required Soce.
