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Time Spent Filing Taxes Costs Economy $409 Billion

A complicated tax code is hurting the U.S. economy, according to a Tax Foundation report. 
Americans will spend more than 8.9 billion hours filing taxes in 2016—an "eye-popping amount of time" that costs the economy $409 billion in lost productivity, according to the report, released June 15. 
"Individuals and business need to devote resources to complying with the tax code instead of doing other productive activities," the report by the independent tax research organization said. "Time is precious, and Americans should not be forced to waste it complying with IRS tax forms." 
The time spent complying with Internal Revenue Service requirements is equal to nearly 4.3 million full-time workers "doing nothing but tax return paperwork," the report said. The Tax Foundation compiled data from the Office of Information and Regulatory Affairs and the Bureau of Labor Statistics for its analysis of the opportunity cost of tax compliance. 
Among the claims in the report is that, "Many businesses choose to become S corporations in order to avoid the second layer of tax that is applied to traditional C corporations. This, too, apparently comes with a high compliance cost. The compliance costs for America's 4 million S corporations now total more than $46 billion annually, nearly $12,000 per firm." 
Business income tax returns topped the list of the 50 most-costly tax code provisions in 2016—more than 2.8 billion hours is equivalent to a loss of more than $147.4 billion, according to the report. Individual income tax returns come in second, costing $98.6 billion. 
A copy of the report, "The Compliance Costs of IRS Regulations" is available here.

#Tax #NewsandInformation #MainStreetPractitioner
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