WEALTHY NONFILERS NEW FOCUS FOR IRS:

Wealthy nonfilers accounted for up to $65.7 billion in unpaid taxes between 2017 and 2020, and the IRS has been doing almost nothing about it, according to IRS data obtained by the Senate’s top tax writer.

Finance Committee Chair Ron Wyden, D-Ore., drew on the data supplied to him by the IRS in a September 28 letter to Commissioner Daniel Werfel, urging him to pay extra attention to “this particularly brazen form of tax evasion.”

Many of the high-income nonfilers are repeat offenders, Wyden noted. The IRS data covering tax years 2017 through 2020 identified 10,272 taxpayers with multiple years of unfiled returns and six-figure unpaid balances. Of that cohort, nearly 1,000 were making more than $1 million per year. Yet only 154 of the offenders were under criminal investigation as of May, as a result of limited resources and prosecutorial discretion by the Justice Department, according to the data.

Wyden acknowledged that the IRS was under significant resource restrictions during that time period, and he noted that Werfel has committed to ramping up enforcement on high-income individuals, including wealthy nonfilers.

The IRS is already seeing results in its efforts to ensure wealthy taxpayers pay up, Werfel said, claiming that it is “collecting hefty amounts of owed taxes.” As evidence, he said the IRS has collected about $38 million in delinquent taxes owed by 175 millionaires over the past few months, and that a team from the Criminal Investigation division had recently closed a lengthy list of cases involving wealthy taxpayers found guilty of tax evasion, money laundering, or filing false claims.