Interesting –
There are 637,212 “IRS Official” millionaires in the United States. (Over 50 members of the US Congress have Net Worth over $10 Million -both Democrats and Republicans – including Rep Nancy Pelosi with a Net Worth of $114.7 Million!) But then there are also: Kayne West ($1.8Bil), David Steward ($4bil), Robert Smith ($5bil), Alex Karp ($3bil), Michael Jordan ($1.6Bil), Oprah Winfrey ($2.7bil), Tyler Perry ($1.0 Bil) and of course Jeff Bezos (Over $200 Bil). (Note: I’m not saying any of these people have misreported their taxes!)
In 2019 the IRS audited 770,000 returns.
In 2020 the IRS audited 509,917 returns
Of the 2020 audits – 10,890 were on returns worth at least $1 mil.
There are many groups – especially those advising President Biden, such as his IRS Commissioner Charles Rettig – that states close to $1 Trillion in taxes due annually do not get reported.
The IRS Budget is about $14 Billion – with just over 76,000 employees – of these there are 17,000 in the enforcement division.
Biden wants to boost the IRS budget to $80 Billion over the next 10 years. (This means a $1bil budget increase in 2021.)
This is in line with the Democratic philosophy of ensuring wealthy pay for the US social services. But where is the bulk of the unreported taxes?
Did you know that about 14% of the US population owns crypto-currencies? With about 80% of Millennial age are interested in the currencies. Did you know the IRS states that cryptocurrencies are an asset and should be taxed? – Just like asset values of investments, property, and luxury items.
Findings by groups such as the Brookings Institute show that 73% of tax evasion (not tax avoidance which is just ignoring payments to the Govt) is individual underreporting. But these taxes only account for about 44% of the entire US revenue.
The second largest source for US income is “payroll (used to pay most social programs) and self-employment taxes which are estimated to be 19 % of evasion. While corporate taxes account for about 9% of tax evasion.
Where’s the gaps? – Nonfarm Proprietor Income, Farm income, Rents and Royalties. These are non-third party reporting processes. Meaning, there is no entity submitting 1099 reports on these incomes. These are self-reporting incomes. Sole-proprietor underreporting is about 30% of individual tax underreporting.
What does all this mean?
There are those who actually make mistakes on their reporting, or they may be misled by misinformation from non IRS advice. The bulk of underreporting is basically bad ethics. (Even if a person disagrees with a tax – it is the US rules to pay and collect). The term most people would use – is “Cheaters”
The biggest problem is the convoluted tax system – it should be simplified for easier payment and monitoring. Why might this not be done? – Mainly be cause a majority of your US representatives are in the top 10% income bracket – and they want more money too!
But who are these people cheating? – not the Government – but “The People of the United States” You, Me – Our neighbors – and themselves.
While we may not agree with all government programs and how our government uses our tax money – the American Way is to be Fair and support our Country!
Sources:
Southern Cajun Catholic Gentleman 