Treasury, IRS plan to close loophole for wealthy partnerships

The IRS plans to end a major tax loophole for wealthy taxpayers, aiming to raise over $50 billion in revenue over the next decade. This loophole involves "partnership basis shifting," where assets are moved among related parties to avoid taxes. The Biden administration deems this practice as unjustifiable, labeling it a "shell game." Increased IRS funding has enabled greater oversight, revealing a $160 billion tax gap among the top 1% of earners. The IRS aims to crack down on high-wealth tax evasion, including improper deductions and delinquent payments. Audit rates on large companies and partnerships are set to increase significantly to address tax avoidance effectively.