By Denise Trowbridge THE COLUMBUS DISPATCH

It's OK to cheat on your taxes. At least, that's what the numbers say.

Plenty of people routinely fib on their tax returns.

The Internal Revenue Service estimates the tax gap, the difference between the tax that Americans owe and what they actually pay, is about $345 billion a year.

Americans are clearly underpaying, but they don't feel guilty about it, according to researchers at Youngstown State University.

Many of the millions of people who cheat on their taxes every year view themselves as "honest citizens battling an unfair tax system," the study found.

"Tax evasion has become such an ingrained part of our culture that many people believe it's no longer considered cheating," said James Tackett, one of three accounting professors who conducted the study.

About 25 percent of those he surveyed admitted to cheating on their taxes. The actual number is probably higher, because a lot of people probably cheat but won't admit it, Tackett said.

Why don't people feel guilty?

There are plenty of opportunities to cheat, there's very little chance you'll get caught, and if you do get caught the penalties are relatively small.

"People are basically doing a cost-benefit analysis when deciding to cheat," said William Raabe, tax expert at Ohio State University. "The chance of getting audited is so low that it's easy to rationalize cutting corners."

And honest taxpayers often end up footing the bill for cheaters.

The average "honest" taxpayer pays an extra $2,680 in taxes each year to subsidize tax cheats, IRS taxpayer advocate Nina Olson said.

Eventually, some of those honest taxpayers feel so much resentment that cheaters are getting away with it that they decide to cheat on their taxes, too, she said. "No one wants to feel like a tax chump."

For other taxpayers, paying less is a "protest vote," Raabe said.

If the U.S. is in an unpopular war, the president or Congress are unpopular, or there's been a government finance scandal, people are more likely to cheat on their taxes, Raabe said.

Others say the tax code is so complicated that even honest taxpayers make mistakes and might end up underpaying.

Most of the tax gap, about $285 billion, stems from people who understate their income or claim more deductions than they deserve.

IRS audit data found that workers who receive W-2 income were most likely to pay all of their taxes. Those with self-employment or business income were the least likely to pay everything they owe.

In a bid to reduce the tax gap, the IRS said in November that it would increase the number of audits for high-income earners and the self-employed. Audits of these groups increased about 18 percent last year.

Still, the overall audit rate is very low. Only about 1 percent of returns are audited, according to the Government Accountability Office.

That's not high enough to get people to pay up at tax time, Tackett said.

It'll take a significantly higher audit rate, stiffer fines for breaking the rules and more stringent income reporting requirements to narrow that tax gap, according to the Youngstown study.

Until that happens, people will keep on cheating,Tackett said. "The current system just doesn't work."•