WASHINGTON (dpa-AFX) - The U.S. Department of the Treasury and Internal Revenue Service have announced that a new initiative to collect past-due tax debt from highly rich individuals has reached a major milestone, with more than $1 billion recovered.
Under the initiative launched last year, IRS assigned dozens of senior employees to pursue high-income, high-wealth individuals who have failed to pay recognized tax debt. This campaign was concentrated among taxpayers with more than $1 million in income and more than $250,000 in recognized tax debt.
In an initial success, the IRS announced last year that it had collected $38 million from more than 175 high-income, high-wealth individuals. The IRS expanded this effort last fall to 1,600 additional such tax-evaders. The IRS assigned more than 1,500 of these 1,600 cases to senior employees, with more than $1 billion collected to date, the Treasury said.
Prior to President Biden's Inflation Reduction Act, more than a decade of budget cuts prevented the IRS from keeping pace with increasing complexity and ensuring that wealthy taxpayers, large corporations, and complex partnerships pay taxes owed under current law, according to the Treasury.
In the past two years, the IRS has launched a new initiative to crack down on abuse of corporate jets for personal travel; a campaign to collect taxes owed by 125,000 high-income, high-wealth earners who have not filed taxes in years; Audits of 76 of the largest partnerships with average assets of $10 billion that represent a cross section of industries including hedge funds, real estate investment partnerships, publicly traded partnerships, and large law firms; Audits of the 60 largest corporate taxpayers, with average assets of $24 billion; and a new regulatory initiative to close a major tax loophole exploited by large, complex partnerships that could raise more than $50 billion in revenue over 10 years.
In addition to enhancing tax fairness, these initiatives will narrow the gap between taxes owed and taxes paid, reducing the deficit, the Department of the Treasury said in a press release. 'New Treasury and IRS analysis shows these investments in high-end enforcement, technology, and data resulting in $851 billion in additional revenue over the next decade if the investments in the Inflation Reduction Act are continued as President Biden has proposed'.
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