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Soft fraudFederal · Internal Revenue ServiceEstimated

$696 billion a year: Taxes owed that never get paid

The IRS projects $696 billion in taxes went unpaid on time for 2022. After enforcement and late payments, $606 billion is projected to go uncollected.

FraudBadPublic receipt
Internal Revenue Service
  1. Gross tax gap, tax year 2022$696B1
  2. Net tax gap, after enforcement and late payments$606B1
  3. From underreported income$539B1
  4. From people who never filed$63B1
  5. From taxes reported but not paid$94B1
  6. Paid voluntarily and on timeAbout 85%1
  7. Who owes it████████████████
fraudbad.comNo taxation without receipts

What happened

The IRS estimates how much tax should have been paid and wasn't. For tax year 2022, the latest projection, the gap was $696 billion. Enforcement and late payments bring it down to $606 billion, which the IRS projects will never be collected.

Three-quarters of the gap comes from income that was never reported.

Why nobody caught it

  • Underreported income makes up $539 billion of the $696 billion gap.

How sure are we?

Estimated

An auditor, inspector general or the agency itself estimated the fraud. It's a measured range, not a list of names.

An official IRS projection. The tax gap measures money owed and not paid; it is lost revenue, not spending.

Sources

  1. IR-2024-262: IRS releases 2022 tax gap projectionsInternal Revenue Service · Oct 10, 2024

Spot an error? Send the source and we'll fix it.

America.co · The RECEIPTS Act

Want to stop it?Sign the Receipts Act.

Public money should come with a receipt anyone can check. The RECEIPTS Act starts with one rule for federal purchases over $25,000 from GSA's buying catalog: publish the price paid next to what other agencies paid for the same thing.

Sign the Receipts Act ↗

A citizen-authored working draft hosted on America.co. It has not been introduced in Congress.