Please use this identifier to cite or link to this item: http://hdl.handle.net/10125/64898

The Effect of Paid Preparer Competition on Individual Tax Avoidance

File Size Format  
HARC 2020 paper 214.pdf 254.26 kB Adobe PDF View/Open

Item Summary

Title:The Effect of Paid Preparer Competition on Individual Tax Avoidance
Authors:George Batta
Andrew Finley
Joshua Rosett
Keywords:paid preparers
individual tax avoidance
competition
Date Issued:30 Aug 2019
Abstract:This study considers how competition among paid preparers affects individual tax avoidance. Merging individual tax return data reported to the IRS at the county level with household income reported by the U.S Census Bureau, along with supply of paid preparer establishments from the National Employment Time Series (“NETS”) database, we observe that paid preparer competition is positively associated with underreporting of income, consistent with competition facilitating client appeasement for avoiding more taxes. Our results are robust to various proxies for paid preparer competition and tax avoidance. In additional analysis, we note that our findings are stronger in counties whose taxpayers more frequently engage a paid preparer and among establishments that do not purport to be a CPA firm. This study contributes to our understanding of how competition impacts financial intermediaries’ decision-making and the environmental factors affecting paid tax preparers’ recommendations.
URI:http://hdl.handle.net/10125/64898
Appears in Collections: 19 Taxation


Please email libraryada-l@lists.hawaii.edu if you need this content in ADA-compliant format.

Items in ScholarSpace are protected by copyright, with all rights reserved, unless otherwise indicated.