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Regulation and Compliance > Federal Regulation > IRS

IRS Thinks Many Large Estates Underpay

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Total U.S. estate tax collections increased to about $27 billion in 2008, up 8% from the 2007 total.

The Internal Revenue Service has published those figures in its 2008 data book.

Total IRS collections increased 2% in 2008, to $2.7 trillion, and gift tax collections increased 36%, to $3.3 billion.

Estate taxes accounted for about 1% of IRS collections in 2008.

The number of estates and trusts filing tax returns or tax obligation estimates in 2008 was 4 million, down from 4.5 million in 2007.

When field agents examined an estate or trust income return, they recommended changes 86% of the time, and they recommended an average of $114,723 in additional payments per return, with an average of $378,608 in additional payments per estate tax return for an estate of $5 million or more.

When the IRS examined an estate or trust return through correspondence, officials recommended changes only 22% of the time, with an average additional recommended payment of $2,877 per return, the IRS reports.

For all individual return exams, the change recommendation rate was 89% for field agents and 85% for exams conducted through correspondence. The average additional payment recommended was $19,150 for individual returns examined by field agents and $6,029 for individual returns examined through correspondence.

A copy of the IRS data book is available here. //


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