Taxpayers beware: the IRS is renewing efforts to address the rising issue of nonfilers, aiming to recover billions in unfiled tax returns."
The Growing Challenge of Nonfilers for the IRS
The Internal Revenue Service, known for its tax audits and collections, is facing a pressing issue: nonfilers. This group, neglecting to file required tax returns, poses a significant challenge as it remains largely under the radar. A recent IRS announcement on nonfiler enforcement signals a crucial step towards addressing this escalating problem.
Understanding the Nonfiling Tax Gap
Recent studies reveal a concerning trend: the tax gap due to nonfilers nearly doubled from $39 billion in 2016 to $77 billion in 2021. This increase highlights the urgent need for effective nonfiler enforcement strategies, especially considering the potential unaccounted for corporate nonfiling.
The IRS’s Approach to Nonfiler Enforcement
Historically, the IRS has tackled nonfiling through delinquent return notices and the Substitute for Return (SFR) program. However, enforcement efforts have waned, with many delinquent notices not progressing to SFRs, leading to a decline in nonfiler compliance actions. With fresh funding from the Inflation Reduction Act, the IRS is poised to enhance its nonfiler enforcement program, focusing initially on high-income individuals.
Resuming Nonfiler Enforcement
The IRS aims to address nonfiling more robustly, targeting individuals with substantial income who have failed to file tax returns. This approach marks a strategic pivot, seeking to narrow the tax gap and bring nonfilers into compliance.
The Scale of the Nonfiling Issue
Nonfiling is not just an individual taxpayer issue; business nonfiling is also on the rise. The IRS's enforcement efforts have fallen short in recent years, with a notable decrease in nonfiler notices sent out, underscoring the need for a concerted effort to tackle this widespread problem.
Policy Implications and Future Strategies
The IRS must combat the nonfiling issue on multiple fronts, from encouraging balance-due filers to promoting filing compliance among gig economy workers. A comprehensive and sustained nonfiler compliance strategy is essential for narrowing the tax gap and ensuring fairness in the tax system.
Don't Find Yourself on the IRS's Radar
If you happen to be a nonfiler and find yourself the IRS's crosshairs, don't take it lightly. They're ramping up to tackle as much of what they see as tax crimes as possible. You definitely need someone in your court for any of what the IRS might plan on leveraging against you.
And you always need to know what the IRS knows about your situation. That's what my team and I are here for. If you find yourself looking at any concerning tax situation, contact me or any member of my Tax Problem Solver team for help immediately. We'll start the ball rolling and take care of things for you Rest assured you'll be in the best hands!
You can reach us by one of the contact methods below in the blue box, or email me at Larry@TaxProblemSolver.com and we can review your specific issues and solve them. You can also click here to book a free consultation.
Would You Like to Find Out What Your
Next Best Steps Should Be?
Choose one of the 3 FREE contact methods that is easiest for you.
Schedule a Call with Us
Click the calendar button below to view our appointment calendar, and choose a day & time, and we’ll call you then.
We look forward to your free consult!
Call Us Now
Click the phone button below to either "click to call" or direct dial a number to speak with us right now.
We look forward to speaking with you!
9-Secrets You Need to Know
When the IRS is after you, you need to be informed. What you say to the IRS can be used against you.
Get My 9 Secrets email series now. I'll also add you to my newsletter.
