The study has been undertaken by the country's three top level institutions, which would also profile the activities used for money-laundering and identify the causes of black money and the sectors in which it is generated.
"So far, there are no reliable estimates of black money generated and held within and outside the country," the Finance Ministry, which commissioned the study, said.
The study will also suggest ways to detect and prevent unaccounted money, bringing it into the tax net.
Work on the study, which commenced in March, is being undertaken by the National Council for Applied Economic Research (NCEAR), National Institute of Public Finance and Policy (NIPFP) and National Institute of Financial Management (NIFM).
The first study on unaccounted money was conducted by NIPFP way back in 1985.
The ministry said that the estimates, which are not reliable, vary from $462 billion to $1.4 trillion.
Even as a joint panel of ministers and social activists, including Anna Hazare is working on the draft Lokpal Bill, yoga guru Ramdev has threatened to go on huger strike here from June 4 on the issue of black money.
The government has also constituted a committee of high-level officials, including the chief of the Central Board of Direct Taxes (CBDT), to suggest a legal framework for confiscating such wealth by declaring it as "national assets".
Last week, senior officials of CBDT met Ramdev in Haridwar to explain measures taken to bring back blackmoney back in the country.
The Government had earlier also constituted a committee, comprising heads of various probe agencies and specialised departments, to monitor the investigation and initiate steps to bring back black money stashed in tax havens.
Besides, the Government is also amending the existing Double Taxation Avoidance Agreements (DTAAs) with different countries and entering into Tax Information Exchange Agreements (TIEA) with tax havens.
Earlier, Finance Minister Pranab Mukherjee had said that the Government has adopted a five pronged strategy, including legislative reforms, to deal with the menace of black money.