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Medicaid Providers Are a Measurable Part of Tax Gap, Particularly as to Payroll Taxes  

Author:  Joan Teresa Kay.

Source: Volume 25, Number 03, Spring 2008 , pp.77-86(10)

Journal of Taxation of Investments

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At least 30,000 Medicaid providers had collectively over $1 billion of unpaid federal taxes in fiscal 2006, according to a report issued by the Government Accountability Office. An in-depth study of just 25 Medicaid providers uncovered abusive tax and related criminal activity, including failures to remit individual income taxes and payroll tax funds to the IRS, and diversion of funds for other purposes. The sample of 25 included providers who received from $100,000 to $39 million in fiscal 2006. As a partial solution, the GAO recommends that the IRS conduct a study to determine whether Medicaid payments can be incorporated into the continuous levy program.


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