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Tax Administration: Erroneous Dependent and Filing Status Claims

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Report Type Reports and Testimonies
Report Date March 19, 1993
Report No. GGD-93-60
Subject
Summary:

The rules for claiming dependent exemptions are too complex and burdensome for many taxpayers to comply with. According to the Internal Revenue Service (IRS), taxpayers erroneously claimed exemptions for an estimated 9 million dependents in 1988, improperly lowering their taxable incomes by about $17 billion. IRS also found that an estimated 3 million taxpayers claimed the wrong filing status. This report (1) identifies the sources of erroneous dependent and filing status claims, (2) discusses the need to simplify the laws on dependents and filing status, (3) determines what IRS is doing to address any erroneous claims, and (4) suggests changes IRS could make in its compliance programs.

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