OTHER INFORMATION (UNAUDITED) 204 

United States Government 

Other Information (Unaudited) for the 

Years Ended September 30, 2023, and 2022 

Tax Burden 

The IRC provides for progressive tax rates, whereby higher earned income is generally subject to higher tax rates. The 

following tables present the latest available information on income tax and related income, deductions, and credit for 

individuals by income level, and for corporations by size of assets. 

Individual Income Tax Liability for Tax Year 2021 

Average Average 

Total Adjusted Income Income 

Number of Adjusted Income Gross Income Tax per Tax as a 

Taxable Gross Income Tax per Return Return Percentage 

Returns (In millions (In millions (In whole (In whole of Adjusted 

Adjusted Gross Income (In thousands) of dollars) of dollars) dollars) dollars) Gross Income 

Under $15,000 30,714 160,421 535 5,223 17 0.3% 

$15,000 under $30,000 27,410 610,846 12,033 22,286 439 2.0% 

$30,000 under $50,000 28,926 1,135,403 50,662 39,252 1,751 4.5% 

$50,000 under $100,000 37,547 2,681,108 200,702 71,407 5,345 7.5% 

$100,000 under $200,000 24,180 3,318,595 367,380 137,245 15,194 11.1% 

$200,000 under $500,000 3,728 828,814 123,563 222,321 33,145 14.9% 

$500,000 or more 7,888 6,117,860 1,421,518 775,591 180,213 23.2% 

 Total 160,393 14,853,047 2,176,393 
205 OTHER INFORMATION (UNAUDITED) 

Corporate Income Tax Liability for Tax Year 2020 

Percentage of 

Income Subject Total Income Tax Income Tax After 

Total Assets to Tax After Credits Credits to 

(In thousands of dollars) (In millions of dollars) (In millions of dollars) Taxable Income 

Zero assets 21,064 4,439 21.1% 

$1 under $500 6,908 1,426 20.6% 

$500 under $1,000 4,364 886 20.3% 

$1,000 under $5,000 21,444 4,312 20.1% 

$5,000 under $10,000 13,079 2,640 20.2% 

$10,000 under $25,000 19,851 3,900 19.6% 

$25,000 under $50,000 17,342 3,389 19.5% 

$50,000 under $100,000 19,750 3,854 19.5% 

$100,000 under $250,000 33,865 6,584 19.4% 

$250,000 under $500,000 32,033 6,189 19.3% 

$500,000 under $2,500,000 117,758 21,388 18.2% 

$2,500,000 or more 1,472,847 217,604 14.8% 

 Total 1,780,305 276,611 

Tax Gap 

The gross tax gap is the difference between the amount of tax imposed by law and what taxpayers actually pay on time 

and/or timely. The tax gap provides an estimate of the level of overall noncompliance compliance during the relevant tax 

periods. Tax gap estimates provide periodic appraisals about the nature and extent of noncompliance for use in formulating 

tax administration strategies. Given the complexity of the tax system and available data, a single approach cannot be used for 

estimating all the components of the tax gap. The most recent estimates covering the tax year 2014-2016 timeframe were 

released in FY 2023. In October 2023, the tax gap projections were issued for tax year 2020 and 2021. The tax gap 

projections for tax years 2020 and 2021 assume compliance behavior that has not changed since the 2014-2016 tax gap 

estimates. 

The gross tax gap is the amount of a tax liability that is not paid voluntarily and on time. The projected gross tax gap 

increased to $688.0 billion in tax year 2021. The gross tax gap is comprised of three components: non-filing, underreporting, 

and underpayment. The projected gross tax gap for each of these components is $77.0 billion, $542.0 billion, and $68.0 

billion, respectively. The gross tax gap projections are also segmented by type of tax: individual income tax, corporation 

income tax, employment tax, and estate and excise tax. The projected gross tax gap for each of these types of tax is $520.0 

billion, $45.0 billion, $118.0 billion, and $4.0 billion, respectively. 

The net tax gap is the gross tax gap less tax that subsequently will be paid either late through voluntary payments or 

collected through IRS administrative and enforcement activities and is the portion of the gross tax gap that will not be paid. It 

is projected that $63.0 billion of the gross tax gap will eventually be paid resulting in a net tax gap of $625.0 billion. The net 

tax gap projections are also segmented by type of tax: individual income tax, corporation income tax, employment tax, and 

estate and excise tax. The projected net tax gap for each of these types of tax is $475.0 billion, $37.0 billion, $112.0 billion, 

and $1.0 billion, respectively.1

 For additional information on the tax gap, refer to Treasury’s financial statements. 

 

Tax Expenditures 

As discussed in greater detail in Note 19—Collections and Refunds of Federal Revenue, tax and other revenues reported 

reflect the effects of tax expenditures, which are special exclusions, exemptions, deductions, tax credits, preferential tax rates, 

and tax deferrals that allow individuals and businesses to reduce taxes they may otherwise owe. 

1

 Individual amounts may not add to totals due to rounding.