Does Credit-card Information Reporting Improve Small-business Tax Compliance?

Joel Slemrod, Brett Collins, Jeffrey Hoopes, Daniel Reck and Michael Sebastiani

No 21412, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We investigate the response of small businesses operating as sole proprietorships to Form 1099-K, an information report released in 2011 which provides the Internal Revenue Service with information about payment card sales. Theory and distributional analysis isolates affected taxpayers, who report receipts equal to or slightly exceeding the receipts reported on 1099-K. Information reporting made these taxpayers more likely to file a return declaring business income, and increased filers’ reported receipts by up to 24 percent. Taxpayers largely offset increased reported receipts with increased reported expenses, which do not face information reporting, diminishing the impact on reported net taxable income.

JEL-codes: H26 (search for similar items in EconPapers)
Date: 2015-07
New Economics Papers: this item is included in nep-acc, nep-ent, nep-iue, nep-pbe and nep-pub
Note: PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

Published as Slemrod, Joel & Collins, Brett & Hoopes, Jeffrey L. & Reck, Daniel & Sebastiani, Michael, 2017. "Does credit-card information reporting improve small-business tax compliance?," Journal of Public Economics, Elsevier, vol. 149(C), pages 1-19.

Downloads: (external link)
http://www.nber.org/papers/w21412.pdf (application/pdf)

Related works:
Journal Article: Does credit-card information reporting improve small-business tax compliance? (2017)
Working Paper: Does credit-card information reporting improve small-business tax compliance? (2017)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:21412

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w21412

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().