The IRS Data Book is out. The IRS yesterday released its annual Data Book. It details activities during fiscal year 2023, including revenue collected and tax returns processed. Between Oct. 1, 2022, and Sept. 30, 2023, the agency collected approximately $4.7 trillion. That reflects 96 percent of the federal funding that supports the government’s operations. During that time, the IRS processed over 271.4 million tax returns and other forms, including 163.1 million individual income tax returns. IRS employees answered nearly 27.3 million phone calls, 25 percent more than the prior year, and had 18 percent more contacts with taxpayers at Taxpayer Assistance Centers. That’s over 1.6 million people at 363 centers across the country.
Vermont Gov. Scott pushes for property tax relief. Republican Gov. Phil Scott wants the state legislature to advance his plan for property tax relief. To cover the loss in funding to school districts, he’s suggested borrowing money from state reserves and loaning it to school districts with the expectation that lawmakers would reform education funding. Vermont Treasurer Mike Pieciak says the plan could hurt the state’s credit rating. Meanwhile, on the other side of the state ledger, tax revenues in March exceeded expectations by a very slim margin.
Exempting overtime pay from Alabama’s income tax proves more costly than expected. Last year the state passed a law to exempt Alabama workers’ overtime pay from its income tax for 18 months. Officials expected the temporary exemption to reduce Education Trust Fund revenue by at least $34 million for fiscal years 2024 and 2025. The Alabama Department of Revenue recently reported that “the total amount of overtime wages paid, if exempted, would have potentially provided an average of $56 in tax savings per employee with a total amount of $184 million in tax savings” — or reduced tax revenues — in 2023.
In Georgia, tax revenues fell a bit in March. Net tax collections totaled $2.34 billion this March, about $338.7 million or 12.6 percent less than in March 2023. Three quarters into the state’s fiscal year, net tax revenue totaled $23.49 billion, $115.6 million or 0.5 percent less than the first three quarters of fiscal year 2023 when the state suspended its motor fuel excise tax. Taking the gas tax suspension into account, revenues are down 4.3 percent.
Indiana’s tax revenues remain slightly ahead of expectations. Through March of the state’s fiscal year that concludes in June, Indiana collected $160 million more in total tax revenue than expected. Individual income tax collections were especially strong: The state collected nearly $400 million more than projected.
A massive case of tax fraud by a tax preparer. In New York State, federal prosecutors arrested a New York tax preparer alleged to have caused “substantially” more than $100 million in tax losses by filing false returns. One the course of ten years, the preparer allegedly filed tens of thousands of federal individual income tax returns with false information—like bogus itemized deductions, fake capital losses, and phony business expenses and tax credits—designed to reduce tax liabilities. This is one of the largest tax frauds ever perpetrated by a tax preparer.
The Daily Deduction will be published on Monday, April 22, and return to its regular schedule on April 29, when Congress returns.
For the latest tax news, subscribe to the Tax Policy Center’s Daily Deduction. Sign up here to have it delivered to your inbox on weekdays at 8:00 am (Mondays only when Congress is in recess). We welcome tips on new research or other news. Email Renu Zaretsky.
