Putting TRAC to Work
Legal and Scholarly
The University of Texas at Austin Red McCombs School of Business
December 2012
How do disclosures of tax aggressiveness to tax authorities affect reporting decisions? Evidence from Schedule UTP By Erin M. Towery
	If disclosing an aggressive tax position on Schedule UTP increases the probability of a position being audited, thus increasing the likelihood of detection,firms should have less incentive to claim the position. Consistent with this intuition, Graetz, Reinganum and Wilde (1986) find analytically that increasing audit probability increases compliance. Hoopes, Mescall and Pittman (2012) provide empirical evidence that tax compliance is increasing in IRS audit likelihood using aggregate audit probability data obtained from the Transactional Records Access Clearinghouse (TRAC). External Link
	Transactional Records Access Clearinghouse, Syracuse University Copyright 2013