New and Current Evidence on Determinants of Aggregate Federal Personal Income Tax Evasion in the United States

Cebula, Richard (2010): New and Current Evidence on Determinants of Aggregate Federal Personal Income Tax Evasion in the United States. Published in: American Journal of Economics and Sociology , Vol. 72, No. 3 (28 July 2013): pp. 701-731.

Abstract

Using the most current data available, this study seeks to identify any new as well as traditional determinants of personal income tax evasion. A variety of empirical estimates find that income tax rates, the IRS audit rate and IRS penalty interest rates, and the unemployment rate all influence tax evasion. In addition, rarely investigated variables including the tax free interest rate, the public’s job approval rating of the President, and the public’s dissatisfaction with government, along with previously unstudied variables, namely, the real interest rate yield on Moody’s Baa-rated long term corporate bonds and the real interest rate yield on three year Treasury notes, also affect income tax evasion.

• Item Type: MPRA Paper
• Language: English
• Keywords: tax evasion; audit rate; IRS penalties; tax rates; real interest rates
• Subjects: E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E62 - Fiscal Policy; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H26 - Tax Evasion and Avoidance

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