The federal government is losing hundreds of billions of dollars annually in tax revenue, with the main culprit being underreporting by taxpayers, according to the IRS.
The tax gap “reflects the difference between projected ‘true’ tax liability and the amount of tax that is actually paid on time,” the IRS said.
For tax year 2022, the country’s projected gross tax gap is calculated to be $696 billion, the agency said in an Oct. 10 statement. In 2021, this figure was $688 billion. The 2022 figure is an increase of more than $200 billion from tax years 2014–2016. It is also up from 2017–2019 numbers. The IRS attributed the increase to economic growth….