CARE Seminar: Kat Bilicka, Utah State

Speaker

Kat Bilicka, Utah State

Biography

I am a public finance economist and my research focuses on the links between corporate taxation, firm behavior and  various policy relevant issues. 

I am a Lars Peter Hansen Associate Professor of Economics and Statistics at Utah State University Jon M. Huntsman School of Business, a Faculty Research Fellow at the NBER Public Economic Program, an International Research Fellow at the Oxford University Centre for Business Taxation (CBT), and CEPR and CESifo Research Affiliate. 

​From January 2025, I am also an Editor-in-Chief at the International Tax and Public Finance (ITAX) journal. 

I obtained my PhD (DPhil) in June 2017 from the University of Oxford and Nuffield College. 

Title

"The Role of Tax Preparers in Individual Tax Optimization"

Abstract

Abstract We examine the role of paid tax preparers in tax optimization of individual taxpayers. First, using the universe of annual personal income tax returns in the US from 2011-2020, we provide novel descriptive evidence characterizing the paid tax preparers and the users of their services. Second, we develop new measures of tax optimization and quantify the effects of paid preparers on tax optimization, leveraging the rotation of clients among preparers. Our findings suggest that one standard deviation better tax preparers reduce the effective tax rates of their clients by 0.5 percentage points, on average, with better tax preparers offering larger reductions and charging higher fees. In a benchmarking exercise, we find that assigning the top 1% of earners a null-preparer would augment the inequality reducing properties of personal income tax system by 13%. We further find that tax preparers who are better at lowering their clients’ tax obligation are also suspected more frequently of under-reporting by the tax authorities. Our results highlight the significant role that paid tax preparers play in shaping post-tax income disparities. JEL codes: H20, H22, H23, H24, H26 Key words: Tax avoidance, tax preparers, inequality, tax revenue collection