The US Treasury and IRS are proposing new tax regulations aimed at closing tax loopholes used by the wealthy to inflate deductions, potentially generating $50 billion in additional tax revenue over the next decade, as part of efforts to address significant tax evasion among top earners.
US Treasury and IRS Target Tax Loopholes Costing $160 Billion Annually for Top Earners
According to Business Insider, the US Treasury and IRS are cracking down on tax loopholes used by very wealthy individuals. They aim to close gaps that allow the richest 1% of taxpayers to avoid paying about $160 billion in taxes each year. The new rules they proposed target tricky business practices where companies manipulate their structures to claim more tax deductions than they should. This can involve shifting tax expenses from properties that don’t qualify for deductions to those that do, unfairly reducing how much tax they owe.
These measures come after a year of research by the Treasury and IRS. They want to make it harder for businesses to exploit these tax loopholes. The proposed rules include making companies report more details about how they shift their tax burdens around. This crackdown is part of a larger effort to stop wealthy individuals from avoiding taxes, especially as audits of these practices have dramatically decreased over the past decade.
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$160 Billion Tax Shortfall: US Treasury Cracks Down on Tax Loopholes – Seeking $50 Billion in Revenue with New Regulations! (PHOTO: Investopedia)
Janet Yellen – Biden Administration Takes Aim at Tax Abuses Amid Inflation Fight
Furthermore, Yellen emphasized the significance of these measures, noting that the Biden administration’s strategy against inflation involves addressing longstanding tax abuses. The Treasury and IRS will seek public input before finalizing these regulations, underscoring their dedication to fair tax contributions and ending loopholes that primarily benefit the wealthiest individuals.
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