[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"detail-sidebar-cat-0-en-105":3,"doc-seo-180014-105":59,"doc-detail-180014-en":131},{"code":4,"msg":5,"data":6},0,"success",[7,13,18,23,28,33,38,43,48,51,55],{"id":8,"doc_module":4,"doc_module_name":9,"category_name":10,"show_sort_weight":11,"slug":12},1,"Document","Story & Novel",90,"story-novel",{"id":14,"doc_module":4,"doc_module_name":9,"category_name":15,"show_sort_weight":16,"slug":17},2,"Literature",80,"literature",{"id":19,"doc_module":4,"doc_module_name":9,"category_name":20,"show_sort_weight":21,"slug":22},4,"Exam",70,"exam",{"id":24,"doc_module":4,"doc_module_name":9,"category_name":25,"show_sort_weight":26,"slug":27},5,"Comic",60,"comic",{"id":29,"doc_module":4,"doc_module_name":9,"category_name":30,"show_sort_weight":31,"slug":32},6,"Technology",50,"technology",{"id":34,"doc_module":4,"doc_module_name":9,"category_name":35,"show_sort_weight":36,"slug":37},7,"Healthcare",40,"healthcare",{"id":39,"doc_module":4,"doc_module_name":9,"category_name":40,"show_sort_weight":41,"slug":42},8,"Research & Report",30,"research-report",{"id":44,"doc_module":4,"doc_module_name":9,"category_name":45,"show_sort_weight":46,"slug":47},9,"Religion & Spirituality",20,"religion-spirituality",{"id":46,"doc_module":4,"doc_module_name":9,"category_name":49,"show_sort_weight":46,"slug":50},"World Cup","world-cup",{"id":52,"doc_module":4,"doc_module_name":9,"category_name":53,"show_sort_weight":52,"slug":54},10,"Lifestyle","lifestyle",{"id":56,"doc_module":4,"doc_module_name":9,"category_name":57,"show_sort_weight":24,"slug":58},19,"General","general",{"code":4,"msg":60,"data":61},"ok",{"site_id":62,"language":63,"slug":64,"title":65,"keywords":66,"description":67,"schema_data":68,"social_meta":124,"head_meta":126,"extra_data":128,"updated_unix":130},105,"en","cash-businesses-and-tax-evasion-morse-karlinsky-bankman-i-introduction","Cash Businesses and Tax Evasion - Morse Karlinsky Bankman - I Introduction","","Cash Businesses and Tax Evasion examines how individuals operating cash-based businesses underreport income and associated payroll obligations, contributing substantially to the federal tax gap. Drawing on nearly 275 field-study interviews with cash business owners and the tax professionals who serve them, the work develops a qualitative account of who evades, which taxes are avoided, and the reasons and mechanisms behind noncompliance. The analysis situates evasion within existing research on tax compliance and income-source effects.",{"@graph":69,"@context":123},[70,84,106],{"@type":71,"itemListElement":72},"BreadcrumbList",[73,77,79,82],{"item":74,"name":75,"@type":76,"position":8},"https://docshare.wps.com","Home","ListItem",{"item":78,"name":9,"@type":76,"position":14},"https://docshare.wps.com/document/",{"item":80,"name":40,"@type":76,"position":81},"https://docshare.wps.com/document/research-report/",3,{"item":83,"name":65,"@type":76,"position":19},"https://docshare.wps.com/document/cash-businesses-and-tax-evasion-morse-karlinsky-bankman-i-introduction/180014/",{"url":83,"name":65,"@type":85,"image":86,"author":91,"headline":65,"publisher":94,"fileFormat":97,"inLanguage":63,"description":67,"dateModified":98,"datePublished":99,"encodingFormat":97,"isAccessibleForFree":100,"interactionStatistic":101},"DigitalDocument",{"url":87,"@type":88,"width":89,"height":90},"https://docshare.wps.com/thumbnails/cash-businesses-and-tax-evasion-morse-karlinsky-bankman-i-introduction/180014.png","ImageObject",300,407,{"name":92,"@type":93},"Gelato","Person",{"url":74,"name":95,"@type":96},"DocShare","Organization","application/pdf","2026-11-08","2026-09-02",true,{"@type":102,"interactionType":103,"userInteractionCount":105},"InteractionCounter",{"@type":104},"ViewAction",12,{"@type":107,"mainEntity":108},"FAQPage",[109,115,119],{"name":110,"@type":111,"acceptedAnswer":112},"Why do cash business owners often underreport taxes?","Question",{"text":113,"@type":114},"The document links underpayment to cash receipt and the opportunities cash businesses have to exclude receipts from reporting, making enforcement and reporting less complete than income subject to third-party reporting or withholding.","Answer",{"name":116,"@type":111,"acceptedAnswer":117},"What does the research rely on to describe tax evasion?",{"text":118,"@type":114},"It provides qualitative details from nearly 275 field study interviews with cash business owners and with tax preparers and bankers who serve cash business clients.",{"name":120,"@type":111,"acceptedAnswer":121},"What is the main structure of the article?",{"text":122,"@type":114},"It proceeds in additional parts: Part II summarizes relevant social science research on small business tax compliance, Part III describes the interview methodology and results, and Part IV concludes.","https://schema.org",{"og:url":83,"og:type":125,"og:title":65,"og:site_name":95,"og:description":67},"article",{"robots":127,"canonical":83},"index,follow",{"doc_id":129,"site_id":62},180014,1788339073,{"code":4,"msg":5,"data":132},{"doc_id":129,"user_id":133,"nickname":92,"user_avatar":134,"doc_module":4,"category_id":39,"category_name":40,"doc_title":65,"doc_description":67,"doc_content":135,"file_id":136,"file_url":137,"file_type":138,"file_size":139,"view_count":105,"is_deleted":4,"is_public":8,"is_downloadable":8,"audit_status":8,"page_count":140,"language":141,"language_code":63,"site_id":62,"html_lang":63,"table_of_contents":142,"faqs":143,"seo_title":144,"seo_description":67,"update_tm":130,"read_time":145,"preview_page_count":4},19241457091524,"https://us-avatar.wpscdn.com/davatar_276721f389ce27ea32af1340a28f341c","CASH BUSINESSES AND TAX EVASION  \nSusan Cleary Morse,Stewart Karlinsky,&Joseph Bankman  \n# I.INTRODUCTION\n\nAccording to government reports,most individuals with business incomefail to pay all their taxes,although some appear to cheat more than others.'Un-derpayment of tax on business income is commonly attributed to the receipt ofcash.²The owner of a clothing store,for example,might sell a dress for cashand not report the cash.Underpayment of tax by individuals on business in-come contributes significantly to the federal tax gap—the difference betweenwhat taxpayers owe on legal source income and what they pay.³  \nThe government estimates that the annual tax gap equals $345 billion.  \nSusan Cleary Morse is a Teaching Fellow at Santa Clara University School offLaw.Stewart Karlinsky is Professor Emeritus at San Jose State University.Joseph Bankmanis the Ralph M.Parsons Professor of Law and Business at Stanford Law School.  \n1.  See U.S.Gov'T ACCOUNTABILITY OFFICE,A STRATEGY FOR REDUCING THE TAXGAP SHOULD INCLUDE OPTIONS FOR ADDRESSING SOLE PROPRIETOR NoNCOMPLIANCE 3(2007)[hereinafter GAO SOLE PROPRIETOR REPORT](noting that“at least 61%”of ScheduleC filers underreported net income in 2001 but that results were“skewed”in that the soleproprietor taxpayers whose underpayment amounts put them in the top ten percent accountedfor sixty-one percent of understated taxes).  \n2.  See Joseph Bankman,Eight Truths About Collecting Taxes From the Cash Econ-omy,TAX NoTES,Oct.29,2007,at 506,506-07 [hereinafter Cash Economy](connectingsole proprietor government data and the cash business sector).  \n3.  See Eric Toder,What Is the Tax Gap?,TAX NoTES,Oct.22,2007,at 1,2(notingthat the tax gap measurement excludes noncompliance stemming from failure to report taxa-ble income generated by illegal activities).  \n4.  Treasury and the I.R.S.estimate the gross federal tax gap for 2001 at $345 billion;after enforcement and collection efforts and late payments,the net federal tax gap estimatefor 2001 is $290 billion.See INTERNAL REVENUE SERVICE AND U.S.DEP’T OF THE TREASURY,REDUCING THE TAX GAP:A REPORT ON IMPROVING VoLUNTARY COMPLIANCE 1(2007)[he-reinafter 2007 TAX GAP REPORT](reporting gross and net tax gap numbers);see also Toder,supra note 3,at 5(discussing National Research Program(\"NRP\")and 1.R.S.estimation me-thodology).  \nSTANFORD LAW&POLICY REVIEW  \nAbout $109 billion of this is attributable to underpayment of taxes on businessincome by individuals.⁵Sole proprietors also underpay Social Security andother payroll and self-employment taxes.⁶Additional underpayments are attri-butable to individuals who operate businesses as partnerships and small corpo-rations.In the aggregate,small business owners report less than half of theirincome,⁷and their underreporting(including informal workers such as garden-ers)is estimated to comprise about half of the tax gap.8  \nThis Article attempts to provide a qualitative picture of tax evasion in thesmall business sector.It provides details from almost 275 field study interviewswith cash business owners and with tax preparers and bankers who serve cashbusiness clients.Our research suggests answers to the questions of who evadestaxes,what taxes they evade,and why and how they evade taxes.  \nThis Article proceeds in three additional parts.Part II summarizes the mainthreads of relevant social science research on small business tax compliance.Part I describes the methodology and results of this interview study.Part IVconcludes.  \n# II.TAX COMPLIANCE IN THE CASH BUSINESS SECTOR:EXISTING RESEARCH\n\n## A.Overview\n\nThe standard economic analysis frames a tax compliance decision as acomparison between(1)the cost of paying tax and (2)the difference betweenthe benefit of avoiding the tax and the cost of the imposition of tax,interest,and penalties,risk-adjusted for the possibility that the government will success-fully challenge the tax avoidance strategy.⁹But this model does not provide acomplete picture of taxpayer compliance or","cbCaiqPJoEZBqy6b","https://ap.wps.com/l/cbCaiqPJoEZBqy6b","pdf",1784968,32,"English","# I. Introduction\n## Cash businesses and the tax gap\n## II. Tax compliance in the cash business sector: existing research\n### A. Overview\n### B. Income Source","[{\"question\":\"Why do cash business owners often underreport taxes?\",\"answer\":\"The document links underpayment to cash receipt and the opportunities cash businesses have to exclude receipts from reporting, making enforcement and reporting less complete than income subject to third-party reporting or withholding.\"},{\"question\":\"What does the research rely on to describe tax evasion?\",\"answer\":\"It provides qualitative details from nearly 275 field study interviews with cash business owners and with tax preparers and bankers who serve cash business clients.\"},{\"question\":\"What is the main structure of the article?\",\"answer\":\"It proceeds in additional parts: Part II summarizes relevant social science research on small business tax compliance, Part III describes the interview methodology and results, and Part IV concludes.\"}]","Cash Businesses and Tax Evasion - Morse Karlinsky Bankman - I Introduction | PDF",81]