How the District of Columbia Might Better Manage Its Tax Compliance Program

In the District of Columbia, the Department of Finance and Revenue (DFR) administers the tax laws, and the Tax Compliance and Registration Division informs and assists taxpayers. The District has encouraged voluntary compliance with tax laws by an active program of taxpayer assistance and enforcement: identification of and followup on nonfilers, audit of tax returns, and collection of delinquent taxes. However, more could be done. The District must find out why people need help with their tax returns, do not file returns or pay their taxes, and make mistakes in preparing their returns. The District needs to establish a system for analyzing the voluntary taxpayer-compliance program and provide for obtaining the information for such analysis.