IRS releases tax gap report.

• Author: Nevius, Alistair M.
• Position: FROM THE IRS

The Service has released a report addressing the tax gap. The tax gap is the shortfall between taxes collected and the actual amount owed, which results from nonfiling, underreporting, and underpayment. For 2001, the IRS estimates that only 86% of taxes owed were collected, resulting in a tax gap of approximately $290 billion.

In September 2006, Treasury released a strategy for reducing the tax gap, consisting of seven components:

* Reducing opportunities for evasion;

* Making a multiyear commitment to research;

* Continuing improvements in information technology;

* Improving compliance activities;

* Enhancing taxpayer service;

* Reforming and simplifying the tax law; and

* Coordinating with partners and stakeholders.

The IRS report details compliance objectives and initiatives for achieving the components of the strategic plan, along with...