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Bill USA

(6,436 posts)
3. Rich Cheat More On Taxes, New Study Shows - Forbes.com
Thu Mar 1, 2012, 09:29 PM
Mar 2012
http://www.forbes.com/2008/10/21/taxes-irs-wealth-biz-beltway-cz_jn_1021beltway.html

A new study based on unpublished Internal Revenue Service data shows the rich are different when it comes to paying taxes: They hide more of their income.

The previously unreported study estimates that taxpayers whose true income was between $500,000 and $1 million a year understated their adjusted gross incomes by 21% overall in 2001, compared to an 8% underreporting rate for those earning $50,000 to $100,000 and even lower rates for those earning less. (The "net misreporting rate" as the IRS calls it, includes both underreported income and inflated deductions.)

In all, because of their higher noncompliance rates, those with true incomes of $200,000 or more received 25% of all income, but accounted for 40% of net underreported income and 42% of underreported tax in 2001, the new analysis finds.

Slide Show: Who Cheats The Most On Their Taxes?

The study was written by Joel Slemrod, an economics professor and director of the Office of Tax Policy Research at the University of Michigan's business school and IRS economist Andrew Johns. It has not been officially endorsed or even released by the IRS and seems sure to add fuel to the election season debate over whether those earning $250,000 or more should pay higher tax rates, as Sen. Barack Obama, the Democratic presidential nominee, has proposed.

CLICK ON PHOTO TO SEE SLIDE-SHOW WITH FACTS ABOUT TAX EVADERS


No. 1 (Cheats Most)
True Income: $500,000 to $1 million.......Net Misreporting Rate: 21%



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