The Tax Foundation has released a new study on The Rising Cost of Complying with the Federal Income Tax.  The study estimates that complying with the federal income tax code during 2005 cost U.S. taxpayers $265.1 billion (up from $134.2 billion in 1995 (in inflation-adjusted dollars)), or 22 cents per dollar of tax revenues collected (up from 15 cents per dollar of tax revenues collected in 1995). By 2015, compliance costs are projected to grow to $482.7 billion.

Compliance costs are highly regressive, taking a larger toll on low-income taxpayers as a percentage of income than high-income taxpayers. On the low end, taxpayers with AG) under $20,000 incur a compliance cost equal to 5.9% of income while the compliance cost incurred by taxpayers with AGI over $200,000 amounts to just 0.5% percent of income.


One of the factors contributing to rising tax complexity in recent years is the sheer growth of the Internal Revenue Code:


More here.