Wealthy Americans are still ducking the IRS crackdown on non-filers [View all]

Source: msn/CNBC

12h


WASHINGTON — Tens of thousands of wealthy Americans are not complying with recently revamped Internal Revenue Service efforts to get them to file tax returns, according to data obtained exclusively by CNBC.

A quirk in federal tax law may be incentivizing wealthy people who want to avoid paying taxes to simply not file their returns. That’s because it’s a felony to file false tax returns but only a misdemeanor not to file a return at all.

And due to limited IRS and Department of Justice resources to pursue misdemeanor violations, a person who does not file a return is unlikely to face prosecution. As a result, many millionaires could simply be taking their chances, betting that they will face few consequences for not filing their tax returns.

In early 2024, the IRS began an effort to contact people it calls “high income non-filers” and urge them to file returns to the tax agency. “We have made progress,” an IRS official told CNBC, explaining that high net worth cases can take time to process. “That said, there still remains a lot of work. We continue to pursue these folks. This is not work that we will let go.”

Read more: https://www.msn.com/en-us/money/taxes/wealthy-americans-are-still-ducking-the-irs-crackdown-on-non-filers/ar-AA1vqnwS