Monday, June 11, 2007

"Big 4" plus BDO and "G-Thorn" Speak out on Tax Gap

Mega-CPA firms BDO Seidman, Deloitte, Ernst and Young, Grant Th0rnton, KPMG and PriceWaterhouseCoopers submitted a position ("white") paper to IRS Chairman Mark Everson last month commenting on the tax gap, including strategies for reducing the gap. Proposals included emphasis on areas with comparatively high noncompliance, improved use of technology and use of measurement milestones. The paper did not absolve the preparer community, indicating that some preparers either failed to obtain all facts needed or failed to be sufficiently viligant against noncompliance.

Hard to tell if this paper will accomplish anything more than a press release for the participating firms; I suspect that the IRS was already working on improving its use of technology and developing measures of compliance performance. The best idea in my mind is the initatives toward improving preparer performance. While education seminars are a good idea (and one that IRS is already using--albeit with too many held either at large coastal cities or resort communities); the best idea (albeit one that the IRS for the most part does not control) is simplification of the tax code.


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