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IRS budget cuts cost $34.3B in lost revenue from big business

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Re: IRS budget cuts cost $34.3B in lost revenue from big business

#261

Post by isoskeles »

Loughla wrote: post #224
isoskeles wrote: post #149

Earlier quoted context omitted.

Well then, we should make the entire government and every single person in the country an IRS employee so we’ll have infinite money by that logic. How do you factor in for the point where these agents having diminishing returns? Is it when the agency brings in as much as they cost? If so, why is that the reasonable place to employ to? The purpose of the IRS is to collect taxes to fund other agencies that don’t direct…

What a weird argument. The other person says "hey, look, we learned that cutting this service had a negative effect on our country, and we learned from our lesson" and your response is "Well then make everyone part of that service" What? How does that make sense? Why are you making that drastic of a leap? Why?

How doesn’t it? You didn’t address a single point here.

Many government agencies make no money, as they’re not profitable organizations (I’d argue the entire government is de facto a non-profit organization but that’s a separate argument). The few that are able to make money would typically do so for their own ends (like taxing gasoline for maintaining roads). The IRS is one of the few organizations that generates income for the government specifically to spread across other agencies.

What’s insane to me is people talking about this like there’s no ceiling to how much money the IRS can take or that if the IRS went to $0 per employee that would somehow be a good thing. It’s the same thing when people say NASA generates income for the country therefore we should fund it more. Be intellectually honest with yourselves, if we funded the IRS or NASA or any other entity that makes $X/employee, there is a point where that funding becomes suboptimal. And I’m not seeing anyone discuss what the optimal amount is here, it just seems like you think the amount is “more” because taxing people is “good.”

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#262

Post by alt_f4 »

Spooky23 wrote: post #82

The GOP direction has been to break the IRS since the 90s. None of the administrations were willing or able to take a stand against it, and this administration is actively trying to break the executive branch overall. A good friend was a specialist in a few tax evasion schemes used by real estate developers and a few other more obscure areas with similar methods. Basically, there were about 50 people nationally doing…

> That is money being stolen from the treasury.

Actually, that is money being stolen by the treasury from the business owner.

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#263

Post by chowells »

alt_f4 wrote: post #262
Spooky23 wrote: post #82

The GOP direction has been to break the IRS since the 90s. None of the administrations were willing or able to take a stand against it, and this administration is actively trying to break the executive branch overall. A good friend was a specialist in a few tax evasion schemes used by real estate developers and a few other more obscure areas with similar methods. Basically, there were about 50 people nationally doing…

> That is money being stolen from the treasury. Actually, that is money being stolen by the treasury from the business owner.

No. Taxes are not theft. Taxes are payment for services. Failure to pay is theft.

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#264

Post by hollerith »

chowells wrote: post #263
alt_f4 wrote: post #262

Earlier quoted context omitted.

> That is money being stolen from the treasury. Actually, that is money being stolen by the treasury from the business owner.

No. Taxes are not theft. Taxes are payment for services. Failure to pay is theft.

There is a big difference between the things your comment calls services and, e.g., Netflix's streaming service: namely, it is relatively easy to cancel Netflix's streaming service, and after I cancel, I no longer have to pay.

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#265

Post by conanbatt »

groby_b wrote: post #76
conanbatt wrote: post #66

Earlier quoted context omitted.

> Taxes are a membership fee for society If only you could appreciate that the US was founded protesting a 5% GDP tax rate.

If only you could appreciate that it was * founded by wealthy landowners interested in protecting their interests * that 5% tax wasn't going towards US infrastructure * 200+ years have passed since, and we've gone past horse-drawn carriages

> that 5% tax wasn't going towards US infrastructure

This is incorrect as England was providing military services to the American colony. Adam smith implies that the cost of the military was actually higher than the taxes collected.

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#266

Post by MyNameIsFred »

refurb wrote: post #225
rsynnott wrote: post #185

Earlier quoted context omitted.

This seems absolutely insane. > For those making less than $25,000, the audit rate fell 0.02% (to .69%) from 2017 to 2018. Frankly, for it to be significantly above 0 seems grossly inefficient. I would assume that average rate of return for public money spent on auditing a millionaire is... a fair bit higher than that spent auditing someone earning 25k.

It’s not insane at all. Note that’s AGI - adjusted gross income. If we stopped auditing those with AGIs less than $25,000, then all I’d have to do is take enough deductions (retirement contributions, unreimbursed business expenses, medical expenses, loss from property sales, tuition, etc) to get my AGI below $25,000 and I’d never have to worry about being audited. Ever. One way to significantly reduce your taxes is t…

That's an alarming equation. The harder you lie, the less likely you'll be called out on it.

What else in life works that way?

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#267

Post by tempestn »

AnthonyMouse wrote: post #253
tempestn wrote: post #215

Earlier quoted context omitted.

The 'costs' to the taxpayer are in taxes they already owe and should have paid though. Perhaps the increased enforcement will encourage fewer people and corporations to under-pay their taxes, resulting in greater efficiency than that shown by the direct collections of unpaid taxes. More generally, it seems strange to me to consider having to pay taxes owed as a cost that should be avoided. IE if the police had to spe…

> The 'costs' to the taxpayer are in taxes they already owe and should have paid though. No, they're what the taxpayer has to spend on accountants and lawyers when they get audited even though they haven't done anything wrong. Or have done something wrong, but by mistake, and then the government consumes $1 in total resources to correct a $.90 mistake. > Perhaps the increased enforcement will encourage fewer people a…

Your first point is well taken. I hadn't considered that aspect in writing my response, but I totally agree. I run a small business myself and certainly would not relish an audit, both due to direct but also productivity costs.

I'm less sure about the second point, specifically that there's no low hanging fruit there. ISTM if that were true, then investment in enforcement would not show such a large immediate profit. Doesn't that by definition demonstrate that there is low-hanging fruit? If we were close to the 1:1 point then I could see the argument, especially in conjunction with your first point, but we're not.

I do generally agree with the point that the tax system (and especially filing) should be simplified though, as long as the simplification isn't in fact a regressive tax cut in disguise.

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#268

Post by conanbatt »

enraged_camel wrote: post #213
hervature wrote: post #177

Earlier quoted context omitted.

And that's easily countered by having franchises and not subsidiaries

And that's easily countered by saying, "total profits, including subsidiaries and franchises." See, we can play this game all day. The fundamental point is this: just because people might break a law (directly or in spirit) is not an argument against having said law.

And yet in this game, lawyers and accountants make bundles of cash, politicians leave unscathed from their failures and the common citizen pays more taxes for less value each step of the way

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#269

Post by doingmyting »

MyNameIsFred wrote: post #266
refurb wrote: post #225

Earlier quoted context omitted.

It’s not insane at all. Note that’s AGI - adjusted gross income. If we stopped auditing those with AGIs less than $25,000, then all I’d have to do is take enough deductions (retirement contributions, unreimbursed business expenses, medical expenses, loss from property sales, tuition, etc) to get my AGI below $25,000 and I’d never have to worry about being audited. Ever. One way to significantly reduce your taxes is t…

That's an alarming equation. The harder you lie, the less likely you'll be called out on it. What else in life works that way?

The US presidency

Re: IRS budget cuts cost $34.3B in lost revenue from big business

#270

Post by tasty_freeze »

nybble41 wrote: post #258
tasty_freeze wrote: post #227

Earlier quoted context omitted.

Thank you for replying instead of simply downvoting. That isn't true. If the assertion is that if Apple has to pay $10B/year more in taxes, than they will raise the price of their products $10B/year and keep a fixed profit, that assumes there is complete price elasticity. In reality, they might raise the price of their products some, but that is fine -- the people who use the products and benefit from the government'…

> If the assertion is that if Apple has to pay $10B/year more in taxes, than they will raise the price of their products $10B/year and keep a fixed profit, that assumes there is complete price elasticity. No, I'm not assuming that. The quantity sold will decrease, of course, if the price increases. That is a hidden cost paid by prospective buyers who must now do without the good, complementing the more visible cost p…

On the first point, the company I have worked for for the past 15 years has had wildly different ROIs during different phases of its life. Assuming that ROI is a fixed quantity will lead to a wrong conclusion.

On the second point, yes, free oil to Exxon will lower the price of gas, and that is a benefit to the consumer. But you assume 100% of that benefit is given to the consumer. In reality, corporations keep as much of the profit as they can and either keep it in their war chest, acquire assets, or distribute it to shareholders.

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