The Internal Revenue Service (IRS) reported a significant accomplishment in their ongoing endeavors to bolster tax enforcement, revealing that they managed to reclaim $482 million from affluent tax evaders in the past year.
According to the IRS’s year-end progress report released this month, their enforcement efforts will persistently target large corporations, high-income earners, and intricate partnerships that evade their tax obligations. They are committed to ensuring that these entities contribute their due share to the U.S. tax system.
Specifically, the IRS took action against 1,600 millionaires to recover outstanding tax liabilities, demonstrating their unwavering dedication to upholding tax compliance standards. This achievement underscores the agency’s resolute stance against tax evasion and its determination to maintain fairness in the tax system.
“The IRS continues to increase scrutiny on high-income taxpayers as we work to reverse the historic low audit rates that the wealthiest individuals and organizations faced,” said IRS Commissioner Danny Werfel when he referred to the previous White House administrations.
“We are adding staff and technology to ensure that the taxpayers with the highest income, including partnerships, large corporations and millionaires and billionaires, pay what is legally owed under federal law,” Werfel also said.
Here are some instances illustrating financial misconduct and tax evasion:
- A Swiss bank reached a settlement with the U.S. Treasury in December, agreeing to pay roughly $122.9 million. The bank had facilitated tax evasion by U.S. taxpayers through undeclared accounts, totaling 1,637, holding assets worth $5.6 billion. These clients collectively dodged $50.6 million in U.S. taxes.
- In another case from the same month, an individual was sentenced to 28 months in federal prison and ordered to reimburse the IRS with over $470,000. This person had filed a false tax return while acting as a money mule for romance scams. They managed bank accounts to receive funds from fraudulent schemes and transferred the money overseas, both for themselves and others.
- An individual involved in the operation of several restaurants in the Washington, D.C. area received a 57-month prison sentence for failing to pay over $1.35 million in taxes. Their evasion tactics included concealing assets, obscuring significant sums of money taken from the businesses, and making false entries in the books. Additionally, they purchased property under a nominee entity’s name and used business bank accounts for personal expenses, further complicating their tax evasion scheme.
In 2022, the White House and Congress collaborated to enact the Inflation Reduction Act, a pivotal legislation aimed at curbing inflation. This legislation allocated supplementary funds, enabling the recruitment of additional IRS agents tasked with conducting thorough audits on high-income tax evaders. According to the agency, these efforts have yielded tangible benefits for compliant taxpayers, signaling a significant stride towards upholding tax integrity and fairness.
As the initiatives to improve compliance increase, the IRS continues its work to improve customer service and modernize core technology infrastructure.
“We focused on improving our taxpayer service for hard-working taxpayers, offering them more in-person and online resources in 2024.”
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