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Many foreign and U.S. based companies are failing to pay federal income tax according to federal researchers. A study by the Government Accountability Office indicates two-thirds of US corporations paid no federal income taxes between 1998 and 2005. The report finds a majority of foreign owned businesses escaped a tax bill during the same seven year period. More than 38,000 foreign corporations had no tax liability in 2005 and 1.2 million US companies paid no income tax, the GAO said. Combined, the companies had $2.5 trillion in sales. About 25 percent of the US corporations not paying corporate taxes were considered large corporations, meaning they had at least $250 million in assets or $50 million in receipts. Internal Revenue Service records reveal over one point six million U-S businesses owe over $58 billion in unpaid federal payroll taxes, including interest and penalties. Federal investigators charge these businesses are taking advantage of the existing tax enforcement and administration system to avoid fulfilling or paying federal tax obligations. Over a quarter of payroll taxes are owed by businesses with more than 3 years of unpaid payroll taxes. Some of these business owners repeatedly accumulated tax debt from multiple businesses. For example, the IRS found over fifteen hundred entrepreneurs to be responsible for non-payment of payroll taxes at three or more businesses, and 18 were responsible for not remitting payroll taxes for a dozen different businesses! The GAO is the investigative arm of Congress and the recent testimony about the billions of dollars in unpaid taxes owed by businesses before a Senate Committee is online. You can find more details by clicking on this link: http://www.gao.gov/new.items/d081034t.pdf
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