Millionaires beware: The IRS is cracking down on nonfilers

  • The IRS is sending out notices about unfiled tax returns to high-income households
  • More than 125,000 notices are being sent, potentially amounting to hundreds of millions of dollars in unpaid taxes
  • The notices are going to households with income between $400,000 and $1 million, as well as households with at least $1 million in income
  • The IRS already has certain tax forms from third parties that indicate significant income but no tax return
  • The program targeting nonfilers has only run sporadically since 2016 due to shrinking IRS staff and budget capabilities
  • Immediate action is advised to avoid additional penalties and enforcement measures
  • The IRS has collected nearly $500 million in delinquent taxes from wealthy households
  • Failure to file tax returns can become a criminal offense in extreme cases

The Internal Revenue Service (IRS) is taking action against high-income households that have failed to file tax returns. More than 125,000 notices are being sent out, potentially amounting to hundreds of millions of dollars in unpaid taxes. The notices are targeted at households with income between $400,000 and $1 million, as well as households with at least $1 million in income. The IRS already has certain tax forms from third parties that indicate significant income but no tax return. However, due to shrinking IRS staff and budget capabilities, the program targeting nonfilers has only run sporadically since 2016. Immediate action is advised to avoid additional penalties and enforcement measures. The IRS has collected nearly $500 million in delinquent taxes from wealthy households. Failure to file tax returns can become a criminal offense in extreme cases.

Factuality Level: 7
Factuality Justification: The article provides specific details about the IRS sending notices to high-income households about unfiled tax returns, including the number of notices being sent and the potential amount of unpaid taxes. It also includes information about the IRS’s efforts to improve compliance among high-income taxpayers and the consequences for those who fail to file their tax returns. The article does not contain irrelevant information, misleading details, sensationalism, or biased opinions. However, it could benefit from more context about the overall impact of tax evasion and the importance of tax compliance.
Noise Level: 3
Noise Justification: The article provides relevant information about the IRS sending notices to high-income households who haven’t filed tax returns. It includes details about the number of notices being sent, the amount of unpaid taxes, and the consequences for nonfilers. The article stays on topic and supports its claims with quotes from IRS Commissioner Danny Werfel and data from the IRS. However, there are some repetitive details and the article could benefit from more in-depth analysis or insights into the broader implications of tax evasion at the top income levels.
Financial Relevance: Yes
Financial Markets Impacted: The news article pertains to the Internal Revenue Service (IRS) sending notices about unfiled tax returns to high-income households. This could impact the financial markets indirectly as it relates to tax compliance and potential collection of unpaid taxes.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Rating Justification: The article discusses the IRS’s efforts to improve compliance among high-income taxpayers by sending notices about unfiled tax returns. While this does not describe an extreme event, it is relevant to financial topics and could have implications for financial markets and companies.
Key People: Danny Werfel (IRS Commissioner)

Reported publicly: www.marketwatch.com