Consumer Misconceptions about Tax Laws: Results from a Survey in the United States

A survey of 1,131 consumers in the United States identified substantial gaps in knowledge or literacy with respect to fundamental U.S. tax law concepts of withholding and tax liability, tax brackets, tax deductions versus credits, charitable contributions, income and exclusions (gifts), and payroll/...

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Bibliographic Details
Published in:Journal of consumer policy 2020-12, Vol.43 (4), p.807-828
Main Authors: Lyon, Elizabeth, Catlin, J. R.
Format: Article
Language:English
Subjects:
Charities
Commercial Law
Competence
Consumers
Donations
Economic Policy
Employment
Gifts
Liability
Literacy
Males
Marketing
Misconceptions
Original Paper
Philanthropy
Polls & surveys
Respondents
Self employment
Social Sciences
Tax deductions
Taxation
Welfare
Citations: Items that this one cites
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Summary:A survey of 1,131 consumers in the United States identified substantial gaps in knowledge or literacy with respect to fundamental U.S. tax law concepts of withholding and tax liability, tax brackets, tax deductions versus credits, charitable contributions, income and exclusions (gifts), and payroll/self-employment tax. Rates of misunderstanding of each concept ranged from 30% to 79%. Regression analysis suggests tax literacy was higher among males and consumers who were older, more educated, and had higher household incomes. Self-reported tax knowledge was weakly correlated with objectively measured knowledge ( r  = .37, p  
ISSN:0168-7034
1573-0700
DOI:10.1007/s10603-020-09460-2