In 2013, the IRS is likely to report an uptick in the $450 billion tax gap, the amount of revenue it does not collect each year. This collection deficit may be attributed to the underreporting of income, and result in an even greater increase in tax information reporting. As fiscal crises show no sign of abating, the IRS and both federal and state governments will lean more heavily on banks' data filings to reduce the tax gap and improve government bottom lines.
Troy Thibodeau is executive vice president of Convey Compliance Systems, a provider of tax information reporting filing software and services.
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