Monday, June 24, 2024
Evading The Solution For Tax Evasion
Blake Humphreys (Mississippi), Evading the Solution for Tax Evasion:
The United States loses approximately one trillion dollars a year in unpaid taxes. The IRS cannot obtain a large portion of unpaid taxes because of tax evasion schemes committed by wealthy business owners. Pass-through business tax evasion is a major tax evasion scheme that continuously stumps the IRS. Many wealthy individuals commit tax evasion by underreporting their pass-through business income. The IRS cannot catch many of these perpetrators because the process of detecting them is very costly and difficult to catch. The current legislation concerning pass-through business tax deductions, known as the Tax Cuts and Jobs Act, is discriminatory against individuals who are wealthy or are in a specific category of trade and business. The IRS is tackling the tax evasion issue in ways that are very inefficient, such as implementing artificial intelligence in auditing and hiring more employees.
However, tax evasion can be reduced if the government changes specific sections of the Internal Revenue Code, and if the IRS makes changes to its protocol. By modifying Section 199A of the Internal Revenue Code, creating more opportunities for organizations to be classified as tax-exempt, and making changes to auditing procedures and taxpayer responsibilities, the government can narrow the United States Tax Gap, reduce tax evasion, and provide more ways for taxpayers to legally reduce taxes and raise tax revenue. While the government can never fully eradicate the problem of tax evasion, more legal opportunities to lower taxpayers’ taxable income will raise tax revenue and reduce the number of criminal acts in the tax field.
https://taxprof.typepad.com/taxprof_blog/2024/06/evading-the-solution-for-tax-evasion.html