In 1993, fifteen states participated in joint electronic filing, generating more than 600,000 joint electronic returns. The states participating were Indiana, Kansas, Kentucky, Louisiana, Maine, Michigan, MIssissippi, New Mexico, New York, North Carolina, Oklahoma, South Carolina, Utah, West Virginia, and Wisconsin. In addition, several states have joined the IRS in the effort to bring nonfilers back into the tax system. Many states join with the IRS in taxpayer education efforts. For example, one area of interest to many states is programs to give new business owners the information they need to keep compliant with the Oklahoma Tax Commission and the IRS contact holders of new Employer Identification Numbers to tell them about their tax responsibilities.
Cooperative efforts go beyond filing assistance.
Under the law, the IRS can release information about tax audits to states to cross match records and prevent non-compliance. Currently a major effort involves joint audits and investigations in the motor fuel excise tax area. A tax gap in this excise tax causes shortfalls in the Highway Trust Fund, which is dedicated for national highway infrastructure improvements. In 1992, the IRS increased audits in this area to 5.6 percent coverage and over the past three years has doubled criminal investigator staffing for this work. Efforts are underway to find new ways to deal with delinquent taxpayers.