Bryan C. Skarlatos quoted in Law360 Tax Authority article entitled “Pandemic Payment Program Will Add Nonfilers To IRS Rolls,” which explored the effects the coronavirus-related stimulus payments may have on the IRS’s ability to “to collect substantially more revenue in the future from individuals who had previously stayed below its radar.”
Excerpts from the article are below:
By persuading nonfilers to register with the Internal Revenue Service to receive pandemic economic relief payments, the agency is positioning itself to collect substantially more revenue in the future from individuals who had previously stayed below its radar.
The economic impact payments recently approved by Congress are available to all U.S. residents who have work-eligible Social Security numbers and whose incomes fall below the cutoff. The IRS has recommended that those who do not typically file tax returns, such as low-income workers, veterans or people with disabilities, submit their information to the agency to ensure they receive the payments, a response to the spread of the virus, which causes the respiratory disease COVID-19.
The agency has also begun reaching out to homeless shelters and immigrant communities to notify people operating outside the tax system that they may be eligible for government rebates, even enlisting the aid of private tax attorneys to get the word out.
While the agency’s initiative will ensure that many more individuals who are not on the IRS rolls receive their rebates, it also means the government will benefit by guiding those people into the system and will likely eventually realize an increase in tax revenue from the effort.
“Each time you move the compliance rate up by 1%, you collect billions of dollars,” Bryan Skarlatos, partner at Kostelanetz & Fink LLP, told Law360.