Voluntary Compliance


DEFINITION of 'Voluntary Compliance'

An assumption or principle that taxpayers will comply with tax laws and, more importantly, accurately report their income and deductions honestly.

BREAKING DOWN 'Voluntary Compliance'

This is one of those "ideal world" principles; for example, in an ideal world we wouldn't need police officers.

  1. Audit

    An unbiased examination and evaluation of the financial statements ...
  2. Compliance Program

    The internal programs and policy decisions made by a company ...
  3. Income Tax

    A tax that governments impose on financial income generated by ...
  4. Loophole

    A technicality that allows a person or business to avoid the ...
  5. Tax Evasion

    An illegal practice where a person, organization or corporation ...
  6. Earnings Stripping

    Earnings Stripping is a commonly-used tactic by multinationals ...
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  1. Are personal loans tax deductible?

    Interest paid on personal loans is not tax deductible. If you take out a loan to buy a car for personal use or to cover other ... Read Full Answer >>
  2. Does a Flexible Spending Account (FSA) cover braces?

    Funds from a Flexible Spending Account (FSA) can be used to cover costs associated with installing, maintaining and removing ... Read Full Answer >>
  3. Does QVC charge sales tax?

    QVC, an American TV network, is registered with states to collect sales or use tax on taxable items. QVC is also required ... Read Full Answer >>
  4. Does a Flexible Spending Account (FSA) cover glasses?

    The funds in a Flexible Spending Account (FSA) can be used to cover most common medical expenses; this includes the cost ... Read Full Answer >>
  5. Are tax brackets adjusted for inflation?

    Each year, the U.S. Internal Revenue Service (IRS) adjusts tax brackets for changes in the cost of living to calculate federal ... Read Full Answer >>
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