Do Americans Cheat on their Taxes?

The image of the cheating businessman or the dishonest accountant is regularly seen in popular culture. Believe it or not, however, studies indicate that most Americans are actually quite honest when it comes to paying their income taxes. An, surprisingly, the rate of cheating is quite low, especially compared to other countries.

Some might argue that Americans don’t cheat only out of a fear of consequences or of being found out via an audit. However, audit rates are much lower than in recent years. Plus, the likelihood of serious consequences, like jail time, is low for the average taxpayer even if caught.  

So, perhaps it’s something more than fear that spurs Americans to honesty. Perhaps it’s a sense of obligation. A recent survey by the IRS itself actually found that 88% of Americans felt it was unethical and not at all acceptable to cheat on taxes. Even outside of IRS surveys, America has a voluntary compliance rate of income tax filing that ranges from around 81 to 84% on average, which is pretty impressive!

America’s voluntary compliance rates actually prove higher than those of Germany, Italy, and many other countries. So, there really must be something to the whole “American integrity” idea.

On a personal level, no matter how you feel about taxes and their ethical implications, bear in mind that it’s always in your best interest to stay on the side of the law. Not paying taxes or cheating on taxes could cause you to end up owing more and to face some severe fines and penalties. So, put aside any personal feelings or opinions about taxation you may have, and just do the right thing. It appears that most of America will be doing the same.