The IRS has launched a new initiative to target high-income taxpayers who have failed to file federal tax returns. The initiative, funded by the Inflation Reduction Act, involves sending compliance letters to over 125,000 cases where tax returns haven’t been filed since 2017. The mailings include more than 25,000 to those with more than $1m in income, and over 100,000 to people with incomes between $400,000 and $1m between tax years 2017 and 2021. “At this time of year when millions of hard-working people are doing the right thing paying their taxes, we cannot tolerate those with higher incomes failing to do a basic civic duty of filing a tax return,” said IRS Commissioner Danny Werfel. “The IRS is taking this step to address this most basic form of non-compliance, which includes many who are engaged in tax evasion. This is one of the clearest examples of the need to have a properly funded IRS. With the Inflation Reduction Act resources, the agency finally has the funding to identify non-filers, ensure they meet this core civic responsibility, and ultimately help ensure fairness for everyone who plays by the rules.” The IRS has received third-party information indicating that these individuals received income but failed to file tax returns. Failure to respond to the letters can result in penalties, enforcement measures, and potential criminal prosecution. The IRS aims to ensure fairness and improve tax compliance among high-income taxpayers.
