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Brightside Tax, a leader in providing comprehensive tax relief services nationwide, is dedicated to upholding the principles of fairness and integrity within the tax system. We are keenly aware of the challenges and responsibilities faced by taxpayers, especially those with high incomes, in fulfilling their tax obligations. In this light, we wish to inform our clients and the broader public about a significant development announced by the Internal Revenue Service (IRS), aimed at enhancing compliance and ensuring equity in tax matters.
Thanks to the Inflation Reduction Act’s funding, the IRS has launched an ambitious initiative targeting high-income taxpayers who have not filed their federal income tax returns in several years. This effort focuses on more than 125,000 cases of non-filing since 2017, highlighting the agency’s commitment to addressing tax non-compliance at all levels. Notably, this initiative includes over 25,000 taxpayers with incomes exceeding $1 million and more than 100,000 individuals with incomes between $400,000 and $1 million for the tax years 2017 through 2021.
This targeted approach is based on data gathered from third-party information reports, such as Forms W-2 and 1099s, indicating that these individuals have received significant income yet have not complied with their legal duty to file tax returns. The absence of these filings undermines the fairness of our tax system, especially at a time when the majority of hard-working Americans meet their tax obligations diligently.
The IRS’s renewed capacity to address these cases of non-compliance is a direct result of the Inflation Reduction Act, which has provided the necessary funding and resources to undertake this critical aspect of tax administration. The commencement of this initiative is marked by the distribution of IRS compliance letters, including the CP59 notice, which signals the formal process of addressing failure to file tax returns. Approximately 20,000 to 40,000 of these letters will be sent out weekly, prioritizing those in the highest income brackets.
Brightside Tax underscores the importance of immediate action upon receiving such notices. Ignoring these communications can lead to further notices, increased penalties, and more stringent enforcement actions, including potential criminal prosecution. It is crucial for individuals in this position to seek the guidance of trusted tax professionals to expediently file their overdue tax returns and address any tax liabilities, including interest and penalties.
The IRS’s initiative is not just about enforcing compliance; it’s also about fairness and the responsibility we all share in contributing to our society’s well-being. This effort is part of a larger strategy by the IRS to enhance tax compliance across the board, tackling issues from unpaid taxes by millionaires to discrepancies in large partnership balance sheets. The overarching goal is to ensure that everyone, regardless of income level, pays their fair share.
Brightside Tax stands in full support of these efforts by the IRS. We believe in the importance of maintaining a tax system that is fair and equitable for all taxpayers. Our team of tax professionals is ready to assist individuals impacted by this initiative, offering expert advice and support to navigate through the process of filing late returns and resolving any outstanding tax issues. Together, we can ensure compliance and contribute to the fairness of our tax system.
