---
title: Payroll Matters to U.S. Tax System
description: The 2017 Internal Revenue Service Data Book shows that 70% of all federal revenue came through payroll. This affirms payroll’s vital role in the U.S. tax system.
image: https://www.americanpayroll.org/images/default-source/default-album/databook.jpg?sfvrsn=2ac09441_0
---

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By [PayrollOrg Staff](https://blogs.payroll.org/pay-news-now/author/apa-staff) on Apr 20, 2018 10:01:12 AM

# Payroll Matters to U.S. Tax System

On March 29, the IRS released the 2017 [***Internal Revenue Service Data Book***](https://www.irs.gov/pub/irs-soi/17databk.pdf), which provides statistics that underscore the importance of payroll professionals to the integrity of the American tax system.

The 2017 *IRS Data Book* reports that, of the $3.42 trillion that was paid into the Treasury in FY 2017, $2.39 trillion was transmitted by employers for employment taxes. This represents 70% of all federal revenue.

Payroll payments included: $1.33 trillion in withheld individual income taxes, $1.05 trillion in employer and employee FICA (social security and Medicare) taxes, $8.3 billion in unemployment insurance tax, and $6 billion in Railroad Retirement Tax Act taxes.

Compliance with employment tax requirements continues to be a problem area. The *IRS Data Book* reports that in FY 2017, the IRS assessed 5.36 million civil penalties that amounted to almost $7 billion.

Interestingly, the IRS reported the total cost of collecting $100 dropped to $0.34 in 2017.

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