Plan for Reducing the U.S. Tax Gap

Abstract

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What is the U.S. Tax Gap?

The U.S. Internal Revenue Service (IRS) estimates that taxpayers pay 83.6% of taxes voluntarily and on time, with 85.8% of taxes collected after applying enforcement. The most recent estimate from the IRS puts the tax gap at $441 billion per year, calculated using real factual data from fiscal years 2011, 2012, and 2013^[1]. That number drops slightly to $381 billion considering past due payments and law enforcement efforts by the IRS.

A recent study suggests that the aggregate Tax Gap over the course of the next decade will be approximately $7.5 trillion (or $750 billion annually)^[2]. The U.S. tax gap in 2019 was approximately $630 billion.^[3].

The United States is losing $1 trillion in unpaid taxes every year, according to Charles Rettig, the Internal Revenue Service commissioner. He argued that the agency lacks the resources to catch tax cheats: “Mr. Rettig attributed the growing tax gap to the rise of the $2 trillion cryptocurrency sector, which remains lightly regulated and has been an avenue for tax avoidance. He also pointed to foreign-source income and the abuse pass-through provisions in the tax code by companies”.^[5]

What Are the Main Causes of the U.S. Tax Gap’s Increase?

There are six major factors that contribute to the widening U.S. tax gap:

1. Lack of elements of real time economy: a countrywide e-invoicing network, mandatory Online Electronic Cash Registers, the connection and data exchange among business, banks and tax authorities and other public institutions.
2. The existence of a special tax regime that wealthy people enjoy. Most wealthy household income comes from capital gains, such as increases in the value of corporate stocks or real estate. Unlike salaries, which make up most of the household income and they must pay taxes each month or year, capital gains benefit from “deferral”. Taxpayers should not pay the capital gains tax each year unless they sell the asset. That effectively allows the asset owner to decide when to pay tax.
3. Tax liabilities for cryptocurrency owners who did not pay taxes in full.. In recent years, the global cryptocurrency market has grown to an estimated $2 trillion and has expanded its availability and access to a wide range of investors^[6].
   
   Through actions started several years ago, the Treasury and the IRS have stated that they believe there is significant underestimation and underpaying of tax obligations relating to cryptocurrency transactions. They have made cryptocurrency tax evasion an important enforcement target through several initiatives.
4. A distinctive feature of U.S. taxation system is the assumption that the responsibility for the correctness and completeness of tax payment lies with honest taxpayers. Based on this, the U.S. tax administration does not implement modern automation of the process of collecting and verifying taxes. It uses outdated methods of tax audit to verify the correctness of tax payment.
5. Information and current forms of tax reporting are not sufficiently dependable, confidential, and effective to a greater extent for their compilers—taxpayers. Small purchase and sale transactions fall out of tax reporting, control, and audit. In this way, many taxpayers avoid tax audits through this tax loophole. They split their payments and the amounts of transactions conducted so that they fall under the tax audit.
6. The IRS lost over 33,000 employees between 2010 and 2020, including those auditing returns and collecting unpaid taxes. Consumer News and Business Channel (CNBC) previously reported that while the number of millionaires has nearly doubled since 2012, tax audits have dropped by 72%, to 11,331 in 2020, from 40,965 in 2012^[7].

What is The Plan for Reducing the Gross Tax Gap?

President Biden’s administration has developed a comprehensive plan to reduce the tax gap that the Treasury Department estimates would raise $700 billion over ten years^[8]. The plan has three interdependent components: people, computer systems, and information.

A decade of deep budget cuts has led to a 30% reduction in the well-trained IRS audit staff needed to audit the largest corporations and the highest revenue, leading to a sharp drop in their audit rates. The proposal provides robust funding to rebuild depleted audit staff and upgrade the IRS’s antiquated technology systems. Significantly, the House Ways and Means Committee’s legislation to raise revenue adopts the full Biden Administration $80 billion funding proposal to rebuild the agency’s audit staff and upgrade its computer systems^[9].

Funds raised through reducing the tax gap will help government to boost investments in reducing child poverty, addressing climate change, and increasing economic opportunity and security for families across the country.

The Biden Administration believes that the government can recoup much of the revenue represented by the “tax gap” through increased IRS enforcement and expanded information reporting paired with improved compliance rules. Thus, the Biden budget submission for Fiscal Year 2022 (“Biden Budget”) includes a 10.4% increase in IRS funding over current levels^[10]. It also includes specific compliance-related proposals, such as additional reporting on financial accounts, expanded broker information reporting on cryptocurrency assets, and increased electronic return filing.

How will this plan work?

The plan includes six essential points.

1st Point. The Business Payments Coalition (BPC) is initiating a countrywide E-invoice Exchange Market Pilot in the U.S.

The pilot aims at enabling U.S. businesses to exchange e-invoices in a more efficient and sustainable way.

The BPC is a group of more than 600 organizations in the U.S., working together to promote greater adoption of electronic payments, remittance data, and invoices in the business sector. The coalition has launched an E-invoice Exchange Market Pilot for businesses of all types to exchange e-invoices.

According to the BPC, by the end of 2021, U.S. businesses used 25% of invoices in the electronic form^[11]. However, just a few of them count as genuine electronic invoices. For example, many still claim that an email is also an electronic invoice, while the attached invoice does not contain structured data, and the buyer must manually download and/or print the invoice information for further processing. Similar restrictions apply when a service provider issues invoice in an unstructured PDF or data format.

To make business transactions more efficient, the United States has analyzed numerous e-invoicing schemes around the world and are still working on a model that will support American companies in electronic data interchange (EDI).

2d Point. Reforming Capital Gains Taxation

Capital gains income currently enjoys several tax benefits. These include tax deferral, elimination of potential capital gains tax if the owner of those assets dies (the “raised base” loophole), and a tax rate reduced special on realized capital gains (for example, when an interest in stocks or other assets will sell). It is important to understand how these benefits work under current law, and then consider how President Biden proposes to change them.

The following examples of well-known business leaders (about whom financial information is publicly available) show the large benefits of deferring tax on capital gains, which President Biden’s proposal would not change, and the stepped-up basis loophole, which President Biden would eliminate for very wealthy households.

• Warren Buffett: His main asset, Berkshire Hathaway stock, rose in value by over $7 billion in 2010 alone, from about $34.8 billion to $42 billion^[12]. But on his 2010 tax return (which he made public via a letter to then-U.S. House member Tim Huelskamp), Buffet’s adjusted gross income that year was $62.8 million, or less than 1% of that stock increase^[13].
• Jeff Bezos: Amazon’s filings with the Securities and Exchange Commission (SEC) show that he receives an annual salary of $81,840 (as of 2020)^[14], which is subject to ordinary income taxes each year. As founder, however, Bezos owns a significant share of Amazon stock^[15], and the value of his holdings grew by more than $100 billion between 2010 and 2018^[16]. The IRS will tax this $100 billion in income when—or if—Bezos decides to sell some of his stock. Bezos sold Amazon shares worth $6.3 billion between 2009 and 2018, according to SEC filings^[17], but the tax code ignores the rest of his $100 billion gain. Thus, his tax bill on a decade of stock sales could be about $1.5 billion, or less than 1.5% of his increase in wealth due to the appreciation of his Amazon stock.
• Steve Jobs: As CEO of Apple, he received an annual salary of just $1, according to Apple’s SEC filings^[18]. He also received Apple stock in the early 2000s, however, that was worth $75 million when he received it^[19]. It is possible that he paid the income tax on the value of those shares when he received them as compensation. But because he never sold the shares during his lifetime, he never paid capital gains taxes on the massive gain as Apple’s stock skyrocketed^[20]. At his death in 2011, his Apple stock was worth about $2 billion, and neither he nor his heirs will ever owe any income tax on its gain in value during his life.

These examples illustrate the large benefits of deferring tax on capital gains, allowing taxpayers to continue earning gains on money they would otherwise pay in taxes, income that increases over time. This dynamic, in which some of the wealthiest people in the country go through life without paying annual taxes on much of their income, has sparked proposals from Senate Finance Committee Chairman Ron Wyden and others to shift to a “mark-to-market” system for taxing capital gains^[21].

This approach presumes annual taxation of capital gains above a certain threshold as they accrue. It should equalize the income tax treatment of those who hold capital investments and those who earn wages and salary income and pay their taxes annually. The Biden plan takes a more modest approach and leaves the powerful tax advantage of deferral in place. Each year, wealthy people with large unrealized capital gains would continue to pay no tax on the increase in their wealth (that is, on this income), so they would pay exceptionally low effective tax rates overall. What the Biden plan would do is ensure that wealthy people eventually pay income tax on large unrealized capital gains accrued during their lifetimes (that is, gains larger than $1 million, or $2 million for a married couple, plus a special exemption of up to $500,000 for personal residences).^[22].

Some might argue that Biden’s proposal to increase the combined estate tax base would amount to double taxation on the same income, but that argument is powerful. The timing of levying these two taxes, which would occur after the death of the testator, appears to be a major source of misunderstanding.

However, we should not overlook the irony: this proximity only exists because of the special deferral benefit. It allows certain wealthy individuals to avoid paying income tax during their lifetime. Unlike a wealthy musician or artist who, for example, pays taxes annually.

Despite the close temporal proximity, there is no double taxation because there are (at least) two people involved—the deceased and the heir(s). Each person should pay taxes on a separate stream of income. The deceased has unrealized capital gains that accrued tax-free during his lifetime and upon his death the deceased would pay this deferred tax.

This is more in line with the taxation of a wealthy person who derives primarily capital gains income with a person whose income derives primarily from income subject to annual tax. Such as a musician who receives royalties and appearance fees and pays annual taxes on that income. In both cases the testator pays the income tax received during his lifetime. Then the remaining inheritance will be subject to inheritance tax charged to the heir who is a different person.

The heirs are responsible for paying the inheritance tax, even though the state is formally imposing it against the property. Furthermore, heirs owe no income tax on their inheritances — even though other types of earned and unearned income, such as lottery or gambling winnings, face income taxes.

Overall, the testator pays tax on the lifetime accrued gain and the heir pays tax on his exceptional inheritance – and so there is no double taxation.

3d Point. Focus on Cryptocurrency Taxation

For years, U.S. taxpayers’ crypto assets have been in something of a gray area of reporting. But now these cryptocurrency wallets are getting a lot of attention from the IRS and President Joe Biden, who have begun cracking down on tax fraud. Therefore, the Treasury and the IRS have simply basic focus on cryptocurrency. They are targeting taxpayers who do not report transactions and do not pay any tax.

The IRS sent a clear signal to prioritize the application of virtual currencies in July 2018, when the LB&I division launched a campaign aimed at cryptocurrency. In July 2019, the IRS sent three types of letters to taxpayers regarding the potential for non-reporting of virtual currency transactions, forcing some taxpayers to file modified returns.

In late 2019, a global effort to target virtual currency holders went public with the Joint Chiefs of Global Tax Enforcement Crypto Challenge (the “J5”), which includes the tax authorities of Australia, Canada, Netherlands, United Kingdom, and the United States.

In March of 2021, Damon Rowe, the Director of the Office of Fraud Enforcement at the IRS, announced information about an IRS initiative called “Operation Hidden Treasure”. It comprised of agents with cryptocurrency and virtual currency tracking skills. Their focus is on taxpayers who omit cryptocurrency income from their tax returns^[23].

For the 2020 tax year filings includes a question on the Form 1040: “Did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?” IRS has also started using the “John Doe summons” on cryptocurrency issues. The “John Doe summons” serve to obtain the names of all taxpayers in a certain group that may have failed to comply with their tax obligations.

The president’s 2022 budget proposal could lead to a raft of new crypto reporting requirements for those dealing in digital coins. The U.S. Treasury Department’s new “Greenbook”, released in May 2021, calls for more comprehensive reporting requirements for crypto, so it is as hard to spend digital currencies without reporting it as it is to spend cash today. One proposal would require businesses to report to the IRS all cryptocurrency transactions valued at more than $10,000. Another calls for crypto asset exchanges and custodians to report data on user accounts which conduct at least $600 worth of gross inflows or outflows each year.

Another potential major blow to crypto holders: Biden’s proposal to raise the top tax rate on long-term capital gains to 43.4%, up from 23.8%. The state should tax crypto gains as any other type of gain in assets, either on long-term capital gains or ordinary rates. President Biden has proposed to eliminate the difference between the two. This proposal would also function retroactive and apply to any transactions which took place after April 28, 2020^[24].

4th Point. Creating a More Understandable, Effective, Dependable, and Digital Environment for Taxpayers

It is important to note that failure to comply with tax laws often involves unintentional errors resulting from a failure to fully understand what an overly complex tax law is now. For this reason, efforts to reduce the tax gap and improve overall tax compliance must help taxpayers meet their filing and payment obligations, by issuing timely and clear guidance and programs to educate taxpayers about their tax obligations.

To ensure taxpayers have immediate access to information without making a phone call, the IRS provides taxpayers with remote and digital options, including access to a new “chat” function as part of the Taxpayer Digital Communications (TDC) program. They have expanded customer callback, saving Americans hundreds of thousands of hours waiting for assistance, with plans to offer callback options on up to 40 percent of taxpayer calls during the FS21.

The IRS has added new features to the IRS Online Account and created new web applications. “Get My Payment” assist in tracking EIPs and the “Tax Withholding Estimator” helps taxpayers in estimating payroll withholding. They recently achieved the long-time goal of enabling taxpayers to e-File amended returns–effective for e-Filed 1040 and 1040-SR returns for tax year 2019 and later.

The IRS still relies on Individual and Business File Systems that date back to the 1960s–the oldest in the federal government. Modernization funding would allow the IRS to address technological challenges and develop innovative machine learning. They can use it to identify suspicious tax filings, such as comparing tax returns from similarly situated taxpayers and historical filings in a way that the current IRS system does not allow. These resources would also support efforts to meet threats to the security of the tax system, like the 1.4 billion cyberattacks the IRS experiences annually^[25].

5th Point. Changing Main Principles for Tax Reporting Preparation

As IRS Commissioner Charles Retting recently wrote to Senator Elizabeth Warren, “increased information reporting targets under-reported income, which is the largest category of the tax gap”.^[26] A group of his predecessors also has added: “Research shows that when the IRS has access to third-party reporting, compliance rates top 95%. Without third-party information reporting, compliance rates are below 50%. Reliable information is critical to an effective and fair tax system”^[27].

Contrary to some confusion and misinformation, the information reporting proposal’s goal is to avoid burdening taxpayers, protect privacy, and protect low- and middle-income individuals from higher review rates.

There are five key points in the information reporting component of the plan.

1. It Places no New Burdens on Taxpayers and is Simple for Banks to Implement

   The proposal should not burden taxpayers. Taxpayers do not need to reconcile their bank account information with the information on their tax returns. This proposition could not be clearer: the taxpayer has nothing to do. This principle of tax reporting changes the culture of behavior of American taxpayers and simplifies their tax obligations. Additionally, the extra effort for financial institutions is minimal. The information they need to provide to the IRS is already available in existing forms. There is the requirement for 1099-INT forms to report to taxpayers and the IRS the amount of interest income taxpayers receive over $10.

   Under the proposal, financial institutions would add two pieces of information to 1099-INT forms: total outgoing and incoming payments on all accounts over $600. This is much less onerous than some other pre-existing information reporting requirements, including brokers to report sales proceeds and asset tax basis (i.e., expenses) on 1099-B forms that they now regularly distribute to taxpayers and the IRS.

2. Protection of Privacy

   The IRS only sees two pieces of information: gross inflows and outflows from the annual accounts, with no details on individual transactions. There has been some confusion over this aspect of the IRS plan, in part because critics and banking lobbyists misrepresent the proposed disclosure. The Independent Community Bankers Association, for example, erroneously claims that “the Biden administration is proposing to require financial institutions to report to the IRS all transactions of all business and personal accounts worth greater than $600” and nullifies misinformation even in bold^[28]. This statement is not correct: financial institutions only provide two aggregated sets of data described above.

   Further, under the proposal, the IRS will not share information with financial institutions. This is one of the main reasons why, although the proposal targets a high-income earners, it applies to all accounts with balances above $600, rather than to accounts with total income above a certain level.

   Currently, banks do not know a person’s total income and it would be an invasion of privacy if the state will force the IRS to tell banks if a person’s total income reaches a threshold. Instead, the plan has separate protections that would prevent the IRS from raising check rates on filers below $400,000^[29].

   Proposal intents to improve protection of the privacy of taxpayers. IRS employees may face incarceration and heavy fines for violating their privacy, which is part of the IRS’s strong, decades-long experience in protecting taxpayers’ privacy.

   The proposal also includes funding to invest in technological upgrades that would improve data security and protection of taxpayers’ data.

3. It Advances Taxpayers’ Equity

   Correcting an unfairness that arose during IRS audits is one of the plan’s specific goals. Without the personnel or information needed to conduct its audits, the IRS focuses on simpler tax filings for low-income taxpayers.

   Today, the IRS will screen a low-income person claiming the Earned Income Tax Credit (EITC) as likely as someone in the top 1%. This is even though EITC claims account for only 6% of the tax gap, while the top 1% account for over 26%. The information reporting proposal would also help address injustices by providing the IRS with information and tools to prevent and detect violations among high-net-worth individuals, which it has long supported for workers in the lower- and middle-income classes.

   The IRS already has income information for people who earn their income through wages and salaries through the W-2 forms that their employers provide to the IRS. But many wealthy people receive most of their income from more obscure sources, such as asset sales and business transactions, which rarely must cope with comparable third-party reports on their income. The proposal would address that imbalance by providing the IRS with the latest information to uncover undeclared income for which there is little or no third-party information, such as a W-2.

4. Its Low Account Threshold Will Prevent Tax Evasion

   Because the information reporting proposal intends to improve IRS enforcement on high-income earners who do not pay all taxes owed, some policymakers argue that the accounts fall below a certain level—for example, with debts or balances below a $250,000 threshold—should be exempt from the reporting. It might have intuitive appeal, but it would undermine the proposition and wipe out a lot of potential revenue.

   Setting a high account threshold would create opportunities for tax evasion. High-income earners could spread their money across multiple accounts so that each account falls below the reporting threshold, further avoiding detection of their tax evasion.

   The proposed structure, which includes all accounts over $600, limits this type of gambling, allowing the IRS to collect more revenue from high-income tax evaders^[30].

5. More Robust Information Reporting is Strongly in the Interests of Honest Taxpayers and Business Owners

   The disclosure requirement would have a positive effect on honest taxpayers, who consequently face fewer audit risks. This is because, rather than relying on random checks, the IRS would have better information to detect tax evasion and better focus its checks on high-income tax cheating. As the Congressional Budget Office recently wrote, the proposal could “reduce the burden on taxpayers by allowing the IRS to better target non-compliant taxpayers and reduce the number of audits that did not involve any changes to the tax account”.

   The proposal could also increase a sense of trust and fairness, as more other taxpayers would be known to pay more tax due. It would also benefit honest entrepreneurs, by removing unfair advantage from someone who evade their taxes. Most of the tax gap comes from the underestimation of corporate income that should appear on individual tax returns. Policy makers can support honest business owners by introducing more robust information reporting rules.

6th Point. Changing Approach to Tax Audit and Control

Audit rates have recently fallen for the EITC, but they have fallen much more for high-income earners, primarily because the IRS, as its budget has shrunk, has lost more audit staff with the expertise to manage complex returns for high-income earners.

Under President Biden’s plan, the IRS would receive additional resources to hire and train tax auditors who can conduct the complicated audits of those with extremely high incomes and wealth.

While exam rates for high-income applicants would increase under the proposal, he says exam rates for those with actual incomes below $400,000 will not increase from past years^[31].

To avoid the risk of a manual error in the audit, as well as to avoid the personal interest of an audit staff in the tax audit of a particular taxpayer, the IRS needs to pay special attention to automating the tax audit process. It simplifies and speeds up the tax audit process. Tax audit can be more effective, dependable, and simpler for both a taxpayer and the IRS.

Conclusions

We analyzed the current situation with the U.S. tax gap, its causes, and solutions according to Joe Biden’s administration plan. The U.S. tax administration system has the immense potential for growth and development. The IRS should deal with three interdependent components: people, computer systems, and information. It will help to reduce the U.S. tax gap, increase tax revenue, and decrease the shadow economy. The U.S. can accumulate additional resources to improve the nation: reduce poverty and increase economic opportunity.

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References

[1] A Closer Look: Impacting the Tax Gap, IRS. URL: https://www.irs.gov/pub/foia/ig/cl/tax-gap-for-web.pdf

[2] Shrinking the Tax Gap: Approaches and Revenue Potential,” Natasha Sarin and Lawrence H. Summers, Tax Notes, November 18, 2019 (“Over the course of the next decade, barring changes in tax administration efforts, we can expect to lose an estimated $7.5 trillion, or around 3 percent of GDP, annually that our existing law should allow us to collect.”). URL: https://www.nber.org/system/files/working_papers/w26475/w26475.pdf

[3] Reducing the tax gap. Committee For Responsible Budget. July 2021. URL: https://www.crfb.org/sites/default/files/managed/media-documents2022-02/CRFB%20Webinar_Reducing%20the%20Tax%20Gap_07142021_130pm.pdf

[4] Reducing the tax gap. Committee For Responsible Budget. July 2021. URL: https://www.crfb.org/sites/default/files/managed/media-documents2022-02/CRFB%20Webinar_Reducing%20the%20Tax%20Gap_07142021_130pm.pdf

[5] Tax cheats cost the U.S. $1 trillion per year, I.R.S. chief says. Alan Rappeport. Published April 13, 2021. Updated Oct. 13, 2021. URL: https://www.nytimes.com/2021/04/13/business/irs-tax-gap.html

[6] TPC Tax, “Narrowing the “Tax Gap”: Treasury & The IRS Target “High-income Taxpayers” and Cryptocurrency transactions”. URL: https://www.tpctax.com/insights/narrowing-the-tax-gap-treasury-the-irs-target-high-income-taxpayers-and-cryptocurrency-transactions/

[7] CNBC news, “The White House says closing the ‘tax gap’ will help pay for the $1 trillion infrastructure bill—here’s what that means”. URL: https://www.cnbc.com/2021/08/10/what-is-the-tax-gap-infrastructure-plan.html

[8] Chuck Marr, Samantha Jacoby, George Fenton, Sam Washington “Biden Proposals Would Reduce Large Tax Advantages for Those at the Top, Address Tax Gap”, May, 11, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/biden-proposals-would-reduce-large-tax-advantages-for-those-at-the-top-address

[9] Chuck Marr, Samantha Jacoby, Reducing the Tax Gap:5 Key Points on Information Reporting”, September, 14, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/reducing-the-tax-gap-5-key-points-on-information-reporting

[10] TPC Tax, “Narrowing the “Tax Gap”: Treasury & The IRS Target “High-income Taxpayers” and Cryptocurrency transactions”. URL: https://www.tpctax.com/insights/narrowing-the-tax-gap-treasury-the-irs-target-high-income-taxpayers-and-cryptocurrency-transactions/

[11] Information about e-invoicing in the USA. URL: https://www.pagero.com/compliance/world-map/united-states/

[12] CBPP calculations based on Berkshire Hathaway’s Form Def 14A filings with the Securities and Exchange Commission and public share price data from 2010.

[13] “Buffett letter to Rep. Tim Huelskamp,” CNN Money, October 11, 2011. URL: https://money.cnn.com/news/storysupplement/buffett-letter-to-huelskamp/?%20iid=EL

[14] Amazon.com, Inc. Notice of 2020 Annual Meeting of Shareholders & Proxy Statement, May 27, 2020. URL: https://www.sec.gov/Archives/edgar/data/1018724/000119312520108422/d897711ddef14a.htm.

[15] As of February 25, 2019, Bezos owned 16 percent of Amazon’s common stock. Amazon.com, Inc. Notice of 2020 Annual Meeting of Shareholders & Proxy Statement, May 27, 2020. URL: https://www.sec.gov/Archives/edgar/data/1018724/000119312519102995/d667736ddef14a.htm.

[16] Katie Warren, “9 Mind-Blowing Facts That Show Just How Wealthy Jeff Bezos, the World’s Richest Man, Really Is,” Business Insider, May 2, 2019. URL: https://www.businessinsider.com/how-rich-is-jeff-bezos-mind-blowing-facts-net-worth-2019-4.

[17] CBPP calculations based on Jeff Bezos’s Form 4 filings with the SEC.

[18] Notice of 2011 Annual Meeting of Shareholders, February 23, 2011. Form Def14A, Apple, Inc. URL: https://www.sec.gov/Archives/edgar/data/320193/000119312511003231/ddef14a.htm.

[19] Brett Arends, “Steve Jobs Was Robbed,” MarketWatch, May 18, 2010. URL: https://www.marketwatch.com/story/apples-steve-jobs-blunders-on-options-swap-2010-05-18.

[20] David S. Miller, “The Zuckerberg Tax,” New York Times, February 7, 2012. URL: https://www.nytimes.com/2012/02/08/opinion/the-zuckerberg-tax.html.

[21] Chuck Marr, Samantha Jacoby, George Fenton, Sam Washington “Biden Proposals Would Reduce Large Tax Advantages for Those at the Top, Address Tax Gap”, May, 11, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/biden-proposals-would-reduce-large-tax-advantages-for-those-at-the-top-address.

[22] Chuck Marr, Samantha Jacoby, George Fenton, Sam Washington “Biden Proposals Would Reduce Large Tax Advantages for Those at the Top, Address Tax Gap”, May, 11, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/biden-proposals-would-reduce-large-tax-advantages-for-those-at-the-top-address.

[23] TPC Tax, “Narrowing the “Tax Gap”: Treasury & The IRS Target “High-income Taxpayers” and Cryptocurrency transactions”. URL: https://www.tpctax.com/insights/narrowing-the-tax-gap-treasury-the-irs-target-high-income-taxpayers-and-cryptocurrency-transactions.

[24] CNBC news, “How the IRS is trying to nail crypto tax dodgers”. URL: https://www.cnbc.com/2021/07/14/irs-new-rules-on-bitcoin-ethereum-dogecoin-trading.html?__source=sharebar|linkedin&par=sharebar.

[25] A Closer Look: Impacting the Tax Gap, IRS. URL: https://www.irs.gov/pub/foia/ig/cl/tax-gap-for-web.pdf.

[26] Charles Retting, Letter to Senator Elizabeth Warren, Department of the Treasury, August 27, 2021. URL: https://www.warren.senate.gov/imo/media/doc/Warren%20et%20al%20response%20to%20Warren%20082721.pdf.

[27] Chuck Marr, Samantha Jacoby, Reducing the Tax Gap:5 Key Points on Information Reporting”, September, 14, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/reducing-the-tax-gap-5-key-points-on-information-reporting.

[28] Chuck Marr, Samantha Jacoby, Reducing the Tax Gap:5 Key Points on Information Reporting”, September, 14, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/reducing-the-tax-gap-5-key-points-on-information-reporting.

[29] Chuck Marr, Samantha Jacoby, Reducing the Tax Gap:5 Key Points on Information Reporting”, September, 14, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/reducing-the-tax-gap-5-key-points-on-information-reporting.

[30] Chuck Marr, Samantha Jacoby, Reducing the Tax Gap:5 Key Points on Information Reporting”, September, 14, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/reducing-the-tax-gap-5-key-points-on-information-reporting.

[31] Chuck Marr, Samantha Jacoby, Reducing the Tax Gap:5 Key Points on Information Reporting”. September 14, 2021, CBPP. URL: https://www.cbpp.org/research/federal-tax/reducing-the-tax-gap-5-key-points-on-information-reporting.