The Tax Gap

The gross tax gap is the difference between true tax liability for a given tax year and the amount that is paid on time. It is comprised of the nonfiling gap, the underreporting gap, and the underpayment (or remittance) gap. The net tax gap is the portion of the gross tax gap that will never be recovered through enforcement or other late payments.

The reports listed below vary as to whether they focus narrowly on one or two types of tax versus all taxes. They are organized into different sections dealing with Tax Years 2014-2016 (with projections to 2017-2019), Tax Years 2011–2013, Tax Year 2006, Tax Year 2001, and earlier tax years. Also included is a section containing reports on reducing the tax gap.

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Tax Gap Estimates for Tax Years 2014-2016 and Projections for 2017-2019

Tax Gap Estimates for Tax Years 2011-2013

Tax Gap Estimates for Tax Years 2008-2010

Title Author Publication Date Written for
Federal Tax Compliance Research: Tax Gap Estimates for Tax Years 2008–2010PDF IRS, Research, Analysis & Statistics May 2016 Publication 1415 (Rev. 5-2016)

Tax Gap Estimates for Tax Year 2006

Title Author Publication Date Written for
Overview of the Tax Gap for Tax Year 2006PDF IRS, Office of Research January 2012 Public release
Summary of Tax Gap Estimation MethodsPDF IRS, Office of Research January 2012 Public release
Tax Gap MapPDF IRS, Office of Research January 2012 Public release
Federal Tax Compliance Research: Tax Year 2006 Tax Gap EstimationPDF IRS, Office of Research March 2012 Research, Analysis, and Statistics Working Paper
Estimates of the Tax Year 2006 Individual Income Tax Underreporting GapPDF Kim Bloomquist, Ed Emblom, Drew Johns, and Patrick Langetieg (IRS, Office of Research) June 2012 2012 IRS-TPC Research Conference, Publication 1500
Advances in Nonfiling MeasuresPDF Brian Erard (B. Erard & Associates), Mark Payne and Alan Plumley (IRS, Office of Research) June 2012 2012 IRS-TPC Research Conference, Publication 1500

Tax Gap Estimates for Tax Year 2001

Title Author Publication Date Written for
Tax Year 2001 Federal Tax Gap OverviewPDF IRS, Office of Research February 2007 Public release

Tax Gap Estimates for Earlier Tax Years

Title Author Publication Date Written for
Federal Tax Compliance Research: Individual Income Tax Gap Estimates for 1985, 1988, and 1992PDF IRS, Compliance Research April 1996, revised Publication 1415
Federal Tax Compliance Research: Gross and Net Employment Tax Gap Estimates for 1984–1997PDF IRS, Research Division October 1993, revised Publication 1415-E
Income Tax Compliance Research: Net Tax Gap and Remittance Gap EstimatesPDF IRS, Research Division April 1990, revised Publication 1415

Gross Tax Gap Estimates and Projections for 1973-1992PDF

IRS, Research Division March 1988 Publication 7285

Tax Gap Related Methods

This section includes papers that focus on estimation methods that have been used for estimating the tax gap, though these papers do not contain tax gap estimates.

Title Author Publication Date Written for
Statistical Analysis of Compliance Using the NRP Data: Detection Controlled ModelsPDF Jonathan Feinstein, Yale University June 2004 2004 IRS Research Conference
Developing an Econometric Model for Measuring Tax Noncompliance Using Operational Audit DataPDF Brian Erard, B. Erard and Associates, Chih-Chin Ho, IRS August 2002 2002 American Statistical Association Conference

Reports on Reducing the Tax Gap

These reports have been written by the Department of the Treasury and IRS to describe current and planned efforts to reduce the tax gap.