IRS Fails To Collect $250 Billion In Owed Taxes

[jeffrey]

According to a new three year Internal Revenue Service (IRS) study of 46,000 individual tax returns that were audited, over $250 billion in taxes owed went uncollected in 2001, the most current year available. The IRS said that the taxes owed but not paid for was between $312 billion and $353 billion, with approximately $55 billion of these unpaid taxes eventually collected.

The report also noted a small increase in noncompliance for individuals since 1988 when the last IRS study of this kind was conducted. While there were a wide variety of ways that constituted the unpaid taxes, the largest source simply came from individuals who understated their income.




Even after the unpaid taxes that were eventually collected, the final tax gap still amounted to between $257 billion and $298 billion which is still a significant amount in the government's budget. The uncollected amount represents approximately what the government will spend on Medicare this year.

[PRICEPLUS]

I suspect the IRS numbers are a rough guess. The darn tax code is so complex one could easily underpay taxes through no fault of their own! I guess this will mean more audits!