Thursday, September 18, 2008

Oregon doing a good job; citizen's paying their share of federal taxes more accurately

According to a recent GAO audit Oregon is a potential model in the area of regulating tax preparers. There are no federal regulations or requirements that tax preparers must meet prior to preparing taxes. In California and Oregon there is. The GAO compared returns from both states and found that Oregon was more accurate. On average Oregon's 2001 federal returns were $250 more accurate than returns in the rest of the country which equates to $390 million in taxes paid by Oregon residents over what would have been paid if the accuracy rates were at the level of returns in the rest of the country. Seems like an equity issue. Oregon is doing a good job and its citizens are paying their share but citizens in other states aren't.

They also compared each program's costs and found that Oregon's costs were higher because the program includes testing and they are spread across fewer preparers.. The GAO estimated that Oregon's regulatory program cost in 2007 was about $6 million. They conclude "If only a small portion of the increased revenue that we found in Oregon is attributable to the Oregon regulatory regime, the regime would compare favorably to IRS's overall efforts to increase reporting accuracy."

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