Research Areas
Compliance Costs & Tax Complexity
The full cost a tax system is more than the amount of tax paid. It also includes the cost of tax planning and paperwork. Economists call these "tax compliance" costs, and the IRS estimates Americans spend 6.6 billion hours per year filling out tax forms—including 1.6 billion hours on the 1040 form alone. In 2002 Americans spent roughly $194 billion dollars on tax compliance. That amounts to 20 cents of compliance cost for every dollar collected by the tax system.
Additional questions about tax complexity and compliance costs? Contact Bill Ahern at (202) 464-5101.
Articles from the Tax Foundation
- Total Federal Income Tax Compliance Costs, 1990-2015, October 26, 2006
- Number of Words in Internal Revenue Code and Federal Tax Regulations, 1955-2005, October 26, 2006
- The Rising Cost of Complying with the Federal Income Tax, by Scott A. Hodge, J. Scott Moody and Wendy P. Warcholik, Ph.D., January 10, 2006
- The Cost of Complying with the Federal Income Tax, by J. Scott Moody, July 1, 2002
- The Cost of Tax Compliance, by J. Scott Moody, July 1, 2001
- The Cost of Complying with the U.S. Federal Income Tax, by J. Scott Moody, November 1, 2000
- The Impact of Tax Complexity on Small Business, by J. Scott Moody, September 1, 2000
- Compliance Costs of Alternative Tax Systems II, by Arthur P. Hall, Ph.D., March 21, 1996
- An Analysis of the Tax Burden and Compliance Costs of the Armey-Shelby Flat Tax, by Arthur P. Hall, Ph.D., July 1, 1995
- Compliance Costs of Alternative Tax Systems, by Arthur P. Hall, Ph.D., June 1, 1995
- The Compliance Costs and Regulatory Burden Imposed by the Federal Tax Laws, by Arthur P. Hall, Ph.D., January 1, 1995
- The Cost of Unstable Tax Laws, by Arthur P. Hall, Ph.D., October 1, 1994
- Growth of Federal Government Tax "Industry" Parallels Growth of Federal Tax Code, by Arthur P. Hall, Ph.D., September 1, 1994
- The High Cost of Tax Compliance for U.S. Business, by Arthur P. Hall, Ph.D., November 1, 1993
- The Income Tax Compliance Cost of Big Business, by Joel Slemrod and Marsha Blumenthal, November 1, 1993
- Why Not Amnesty?, by TF Staff, September 10, 1985
- Tax Review: Income Tax Simplification, by Harley L. Lutz, July 1, 1943
- Links to Other Tax Policy Resources, January 1, 1937