Eight ways to close the tax gap

The Joint Committe on Taxation has, according to Tax Notes ($), released new ideas for enhancing tax collections. One of the biggest is requiring brokers to report the adjusted tax basis for assets sold during the prior year, to make a dent in the estimated $11 billion lost to unreported capital gains. Other suggestions include:

* expanding broker information reporting requirements to include proceeds from sales at auctions, including sales of collectibles and motor vehicles;
* imposing a due diligence requirement on income tax return preparers to determine whether a taxpayer should report an interest in offshore bank accounts and trusts;
* clarifying and defining timely filing of tax returns by foreign persons;
* expanding requirements for mortgage interest; and
* modifying amounts subject to self-employment tax for partners and subchapter S corporation shareholders in personal service businesses.

The tax gap is currently estimated to be $345 billion.