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Social Security: Trust Funds Can Be More Accurately Funded

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Report Type Reports and Testimonies
Report Date Sept. 2, 1994
Report No. HEHS-94-48
Subject
Summary:

Each year, the social security trust funds are credited with revenues derived from income taxes paid on social security benefits. But do they get the right amount? GAO reports that the social security trust fund's revenues could be increased by recognizing additional taxes identified through the Internal Revenue Service's (IRS) efforts to locate underreported taxable income and through better detection of underreported tax-exempt interest. Recognizing additional taxes identified by IRS could have boosted the trust funds by more than $200 million in tax revenue and investment income for tax years 1984 to 1989. Further, data from the Federal Reserve and the Investment Company Institute indicate that taxpayers may have underreported an estimated $7.2 billion in tax-exempt income on their 1989 tax returns.

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