Skip to main content

Tax audits may not have a deterrent effect, study says

Tax audits don’t always lead to greater compliance down the road, according to a research paper that was one of several recently released in the 2016 IRS Research Bulletin .

If an audit doesn’t result in an additional tax assessment, it may actually result in a drop in compliance, according to “Do Audits Deter Future Noncompliance?,” one of several papers included in the Research Bulletin, which features papers from the latest IRS-Tax Policy Center Research Conference at the Urban Institute in Washington, D.C., last summer.
The conference highlighted research on tax compliance and current tax issues affecting tax administration, and facilitated dialogue among IRS researchers, tax experts from other countries, academic researchers, federal agencies and private sector experts.

Papers include:

• “Do Audits Deter Future Noncompliance?” examining the number of IRS audits annually and the amount of tax recovered, the impact of enforcement activity and the distinction between compliant and non-compliant taxpayers.

•“What Drives Income Tax Filing Noncompliance?” a look at how the decision whether to file a return is a participation decision and the apparent effects of the Economic Stimulus Act of 2008 and the EITC.

•“Understanding the Nonfiler/Late Filer,” an examination of a recent IRS survey aimed at helping understand why individuals who have an unfiled return wait to file that return until the IRS contacts them with notices or enforcement actions.

Author: Jeff Stimpson is a veteran freelance journalist who previously served as editor of The Practical Accountant.

Reference: https://www.accountingtoday.com/news/tax-audits-may-not-have-a-deterrent-effect-study-says?brief=00000158-5504-dc42-a1fe-55d7045f0000

Labels:

Comments

Post a Comment

Popular posts from this blog

MINISTER OF FINANCE SAYS FISCAL DISCIPLINE, RATIONAL ALLOCATION OF RESOURCES ARE VITAL FOR ECONOMIC GROWTH

Fiscal discipline, improved revenue generation, rational allocation and efficient use of resources must be imbibed every tier of Government in the country to return the economy to the path of sustainable growth and development. Other efforts needed to put the country on sustainable growth include the refocusing attention on quality investment in the real sectors of the economy namely agriculture, manufacturing, mines and steel, as well as the promotion of Micro, Small and Medium Enterprises as the critical contributors to the growth of our Gross Domestic Product (GDP).  Minister of Finance, Mrs. Kemi Adeosun stated this in a keynote address at a Retreat organized by the Federal Ministry of Finance in collaboration with the Federation Account Allocation Committee (FAAC) on the theme “Enhancing the Effectiveness of FAAC,” on Thursday in Uyo, Akwa Ibom State.  The Minister was represented at the event by the Permanent Secretary, Federal Ministry of Finance, Dr. Mah...
Post a Comment
Explore more »

Important Improvements Included in COSO’s New Enterprise Risk Management Framework

The Committee of Sponsoring Organizations of the Treadway Commission (COSO) released the final version of its revised enterprise risk management (ERM) Framework,  Enterprise Risk Management–Integrating with Strategy and Performance ,  in September 2017. In the Framework, COSO has come a long way since its initial exposure draft. The Framework takes important steps toward breaking down the siloed nature of managing risk and integrating the responsibly throughout the organization. In  IFAC’s response  to the 2016 exposure draft, we noted that, while the Executive Summary stressed the importance of integration of risk management, the draft Framework itself did not yet sufficiently live up to those aspirations. The final version of the framework now highlights the importance of considering integrating risk in both determining strategy and in driving performance. In this respect it is now closely aligned with the central theme of IFAC’s thought paper  From Bol...
Post a Comment
Explore more »

IFRS FOUNDATION PUBLISHES CASE STUDY REPORT: BETTER COMMUNICATION—MAKING DISCLOSURES MORE MEANINGFUL

The IFRS ®  Foundation has published a case study report showing how companies from different parts of the world have improved communication in their IFRS financial statements.  Better Communication in Financial Reporting—Making disclosures more meaningful  contains six case studies from varied industries. Its aim is to illustrate how improvements can be made and inspire other companies to initiate their own improvement projects. The report explains the process these companies have gone through to improve disclosures in the notes to their IFRS financial statements and shows examples of the improvements made. By identifying what information is relevant, prioritising it appropriately and presenting it in a clear and simple manner, they have made their financial statements easier for investors to read and understand. Through the use of examples, the report shows that relatively small changes can significantly improve the quality of the financial information that compa...
Post a Comment
Explore more »