Georgetown University Law Center Scholarship @ GEORGETOWN LAW 2008 An Overview of the “Tax Gap” Dave Rifkin Georgetown University Law Center,
[email protected] This paper can be downloaded free of charge from: http://scholarship.law.georgetown.edu/fwps_papers/77 This open-access article is brought to you by the Georgetown Law Library. Posted with permission of the author. Follow this and additional works at: http://scholarship.law.georgetown.edu/fwps_papers Part of the Taxation-Federal Income Commons GEORGETOWN LAW Faculty Working Papers October 2008 An Overview of the “Tax Gap” TAXES, The Tax Magazine (forthcoming November 2008) Dave Rifkin Adjunct Professor of Law, Georgetown Law Attorney-Adviser, U.S. Tax Court
[email protected] This paper can be downloaded without charge from: BePress: http://lsr.nellco.org/georgetown/fwps/papers/77/ SSRN: http://ssrn.com/abstract=1162493 Posted with permission of the author AN OVERVIEW OF THE “TAX GAP”* Dave Rifkin** I. INTRODUCTION “Bad things happen if you fail to pay federal income taxes when due.”1 Although the Supreme Court was referring to the calamities that befall taxpayers,2 the same can be said for the government. Some “taxpayers”3--intentionally or unintentionally--fail to report and/or pay the proper amount of tax owed when due. Accordingly, the government must spend money to audit taxpayers, to assess taxes, to collect the proper amount of tax due, and to borrow to replace the lost revenue. Additionally, taxpayer failures to comply with the tax law--i.e., the Internal Revenue