OTHER INFORMATION (UNAUDITED) 212

United States Government 

Other Information (Unaudited) for the 

Years Ended September 30, 2019, and 2018 

Tax Burden 

The Internal Revenue Code 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 2017 

Average 

Total Average Income 

Number of Income AGI Per Tax per Income 

Taxable AGI Tax Return Return Tax as a 

Adjusted Gross Income Returns (in millions (in millions (in whole (in whole Percentage 

(AGI) (In thousands) of dollars) of dollars) dollars) dollars) of AGI 

Under $15,000 .................... 34,167 19,440 1,990 569 58 10.2%

$15,000 under $30,000 ........ 29,474 652,767 18,925 22,147 642 2.9%

$30,000 under $50,000 ........ 27,125 1,062,968 59,757 39,188 2,203 5.6%

$50,000 under $100,000 ...... 34,467 2,457,203 218,619 71,291 6,343 8.9%

$100,000 under $200,000 .... 19,951 2,707,841 340,993 135,725 17,092 12.6%

$200,000 under $500,000 .... 6,215 1,770,816 339,963 284,926 54,700 19.2%

$500,000 or more ................ 1,505 2,338,866 625,034 1,554,064 415,305 26.7%

 Total ............................... 152,904 11,009,901 1,605,281 
 213 OTHER INFORMATION (UNAUDITED)

Corporate Income Tax Liability for Tax Year 2016 

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 ................................ 32,008 10,314 32.2%

$1 under $500 ............................. 7,032 1,337 19.0%

$500 under $1,000 ...................... 3,716 901 24.2%

$1,000 under $5,000 ................... 13,109 3,879 29.6%

$5,000 under $10,000 .................. 8,362 2,678 32.0%

$10,000 under $25,000 ................ 13,270 4,309 32.5%

$25,000 under $50,000 ................ 12,686 4,163 32.8%

$50,000 under $100,000 .............. 14,401 4,630 32.2%

$100,000 under $250,000 ............ 24,546 7,883 32.1%

$250,000 under $500,000 ............ 26,100 7,715 29.6%

$500,000 under $2,500,000 ......... 105,577 31,259 29.6%

$2,500,000 or more ..................... 1,010,414 237,291 23.5%

 Total ...................................... 1,271,221 316,359 

Tax Gap 

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

tax gap provides an estimate of the level of overall noncompliance and voluntary 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. Estimating the tax gap is inherently challenging and requires assessing the merits of alternative 

methods, assumptions, and data sources. There is no single approach that can be used for estimating all the components of the 

tax gap, so multiple methods are used. The most recent estimates covering the Tax Year 2011-2013 timeframe were released 

in Fiscal Year 2019. 

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

gross tax gap is $441.0 billion. The gross tax gap is comprised of three components: nonfiling, underreporting, and 

underpayment. The estimated gross tax gap for each of these components is $39.0 billion, $352.0 billion, and $50.0 billion, 

respectively. The gross tax gap estimates are also segmented by type of tax; individual income tax, corporation income tax, 

employment tax, and estate and excise tax. The estimated gross tax gap for each of these types of tax is $314.0 billion, $42.0 

billion, $81.0 billion, and $3.0 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 estimated that $60.0 billion of the gross tax gap will eventually be paid resulting in a net tax gap of $381.0 billion. The net 

tax gap estimates are also segmented by type of tax; individual income tax, corporation income tax, employment tax, and 

estate and excise tax. The estimated net tax gap for each of these types of tax is $271.0 billion, $32.0 billion, $77.0 billion, 

and $1.0 billion, respectively. 

The IRS remains committed to finding ways to increase compliance and reduce the tax gap, while minimizing the 

burden on the vast majority of taxpayers who pay their taxes accurately and on time. For further detailed information on the 

Tax Gap, refer to the Treasury’s financial statements.