Voluntary Compliance: ‘This Return Might Be Correct But Probably Isn't’

Abstract

Given the systemic problems created by the tax gap and the public’s desire for greater voluntary tax compliance, this author proposes that existing law should be changed so that taxpayers, tax return preparers, and tax advisors could only endorse a tax position to be taken on a tax return without a risk of an understatement penalty or sanction, as the case may be, if the taxpayer, tax return preparer, or tax advisor, as the case may be, reasonably believed that the tax return position is likely to be sustained.

Keywords: tax return, tax reporting standards, tax accrual workpapers