Work

Tax evasion at the top of the income distribution

Year: 2026

Type: article

Abstract: We study tax evasion at the top of the U.S. income distribution using micro-data from audits and enforcement initiatives. Leveraging enforcement that revealed noncompliance, we find that recent individual random audit data fail to capture sophisticated evasion via offshore accounts and pass-through businesses. Consequently, estimates based solely on these data under-state evasion by the highest-income Americans. We construct new distributional estimates of US noncompliance. Circa 2006–2013, accounting for sophisticated evasion (holding estimated non-sophisticated evasion fixed) increases the share of unreported income belonging to the top 1% of the distribution by 9 to 33 percentage points.

Source: Journal of Public Economics

DOI: 10.1016/j.jpubeco.2026.105812

Authors: John Guyton, Patrick Langetieg, Daniel Reck, Max Risch, Gabriel Zucman

Institutions: Internal Revenue Service, University of Maryland, College Park, Carnegie Mellon University, Paris School of Economics, University of California, Berkeley

Language: English

Topic: Taxation and Compliance Studies

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Peace, justice, and strong institutions, Reduced inequalities

Open Access status: hybrid

Estimated APC paid: $4,510