The Blubber

The IRS has detailed tax dodging by the ultra-wealthy and says it recently squeezed 100 millionaires for $122 million in missing taxes, per Bloomberg.

The Internal Revenue Service (IRS) has announced that it collected $160 million in delinquent taxes this year by targeting affluent individuals who had not met their tax obligations.

This focused campaign to address high-income taxpayers was made possible through increased federal funding allocated by Democrats in the Inflation Reduction Act, although it has faced criticism from Republicans, with uncertainty surrounding future funding.

Starting in September, the IRS initiated efforts to reclaim unpaid taxes from approximately 1,600 taxpayers with incomes exceeding $1 million and tax debts exceeding $250,000. To date, the IRS has successfully closed 100 of these cases, recovering $122 million.

Earlier in the year, the IRS had already recouped $38 million from over 175 high-income taxpayers, bringing the year's total to $160 million.

According to IRS Commissioner Danny Werfel, "The evidence we've seen so far, in terms of the amounts we have recovered, underscores the significance of this initiative."

In a notable case, an individual was ordered to pay over $15 million in restitution for falsely classifying personal expenses as deductible business costs, which included constructing a 51,000-square-foot mansion with an outdoor pool and pool house, as well as amenities like tennis, basketball, and bocce courts. The person also fabricated expenses related to luxury vehicles, artwork, country club memberships, and residences for their children.

In another case, an individual pleaded guilty to filing false tax returns and diverting over $670,000 from their business. These funds were spent on personal expenses and gambling.

The IRS's intensified enforcement effort aims to reduce the "tax gap," which represents the disparity between the amount owed and the amount timely collected by the IRS. The most recent estimate indicates that $688 billion in taxes was not collected in tax year 2021.