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Tax Administration: Alternative Filing Systems

  Premium   Download PDF Now (52 pages)
Report Type Reports and Testimonies
Report Date Oct. 16, 1996
Report No. GGD-97-6
Subject
Summary:

Millions of Americans continue to file tax returns each year even though most have fully paid their taxes through the withholding system. Taxpayers in at least 36 other countries with tax withholding systems are not required to prepare income tax returns because these countries use alternative filing systems not currently available in the United States. This report (1) estimates how many U.S. taxpayers would not have to prepare returns under a tax agency reconciliation filing system, (2) identifies the operational characteristics of such a system, (3) discusses the pros and cons of such a system for taxpayers and the Internal Revenue Service, and (4) points out any major impediments to or costs associated with establishing this type of filing system under the current federal tax laws. GAO focuses on a tax agency reconciliation type system because it would not require any tax law changes while a final withholding type system would.

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