Does the IRS have way to know all of your income?
Heres the best bit, people working under the table are going to be making less than 100k generally so it doesn't really matter, anyone making real money will be making big enough waves in the financial system to be detected, small movements of cash doesn't matter at this scale. The highly taxed routes (capital gains) are also already highly policed for tax purposes so no transition is needed there.
Surveys show as much as half of workers make money outside normal employment so this is not some obscure side effect but the common case.
[1] https://finance.yahoo.com/news/side-gigs-2023-50-americans-1...
IRS might not know about those activities, but that income is supposed to be reported.
Illegal activities. Income from illegal activities, such as money from dealing illegal drugs, must be included in your income on Schedule 1 (Form 1040), line 8z, or on Schedule C (Form 1040) if from your self-employment activity.
And then there's crypto...