Tags: WalletHub | tax | evasion | wealthy

WalletHub Report: Tax Evasion Rate Higher Among Non-Wealthy

By    |   Monday, 28 Apr 2014 03:15 PM

Tax evasion rates are higher among the non-wealthy than among the wealthy for both individuals and corporations, according to a new study from personal finance website WalletHub.

In an analysis of IRS data, it found that audited consumers with annual income of less than $200,000 pay penalties 83 percent higher as a percentage of adjusted gross income (AGI) than do people with income higher than that level.

But individuals with income of $10 million or more are 3,933 percent more likely to be audited than those are those with incomes of $25,000 to $100,000.

Editor's Note:
These 38 Dates Are Key to Bagging $313,038


Among audited corporations, those with revenue of $250,000 to $1 million pay penalties that are 11 times higher as a percentage of AGI than do corporations that bring in $10 million to $50 million.

The chances that an individual or small business will be audited is 1 percent, which pales in comparison to the 15.8 percent probability for large corporations.

The audit rate for individuals has dropped 9 percent since 2010. Meanwhile, the rate for small business has climbed 17 percent since 2009, and the rate for large businesses has advanced 15.8 percent during that period.

One distressing finding: the number of people thrown in jail each year for tax crimes has soared 117 percent since 2003 to about 840.

Bankrate.com lists several factors that can cause you to be audited in addition to high income. One is a high level of deductions in relation to your income. Others are unreported income, such as investment income and high non-cash charitable contributions.

Editor's Note: These 38 Dates Are Key to Bagging $313,038

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Tax evasion rates are higher among the non-wealthy than among the wealthy for both individuals and corporations, according to a new study from personal finance website WalletHub.
WalletHub, tax, evasion, wealthy
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2014-15-28
Monday, 28 Apr 2014 03:15 PM
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