91–100 of 231 posts
Earlier quoted context omitted.
They ignore much larger sums. The real reason they’re targeted is that, quite simply, they’re unable to fight back. It’s the equivalent of searching for your keys under the streetlight.
> They ignore much larger sums. Source? What category of stuff the IRS ignores adds up to more than $20 billion?
The reason for this is almost entirely the Earned Income Tax Credit. The IRS estimates 21-26% of all EITC claims are improper. The rules are quite complex, which results in more errors and it is relatively straightforward for the IRS to detect certain classes of mistake or fraud through automation (i.e. to detect if the same child was claimed as a dependent by two different people on their return). Congress made the…
So even if they spend very little time or money on dealing with the EITC they end up doing a lot more audits.
The reason for this is almost entirely the Earned Income Tax Credit. The IRS estimates 21-26% of all EITC claims are improper. The rules are quite complex, which results in more errors and it is relatively straightforward for the IRS to detect certain classes of mistake or fraud through automation (i.e. to detect if the same child was claimed as a dependent by two different people on their return). Congress made the…
Earlier quoted context omitted.
> I’m flabbergasted that we don’t do the same. It is because Intuit and other large tax preparers have lobbied heavily against anything that makes taxes easier to file.
How are you sure it's because of that?
> Internal presentations lay out company tactics for fighting “encroachment,” Intuit’s catchall term for any government initiative to make filing taxes easier — such as creating a free government filing system or pre-filling people’s returns with payroll or other data the IRS already has. “For a decade proposals have sought to create IRS tax software or a ReturnFree Tax System; All were stopped,” reads a confidential 2007 PowerPoint presentation from an Intuit board of directors meeting.
https://www.propublica.org/article/inside-turbotax-20-year-f...
The reason for this is almost entirely the Earned Income Tax Credit. The IRS estimates 21-26% of all EITC claims are improper. The rules are quite complex, which results in more errors and it is relatively straightforward for the IRS to detect certain classes of mistake or fraud through automation (i.e. to detect if the same child was claimed as a dependent by two different people on their return). Congress made the…
If it's that complicated and they are doing audits anyways, can't they just automatically apply EITC without relying on people to figure out this stuff and how to claim it?
And we're now going to get 87,000 more auditors. This is the largest increase in the federal police force (they are all armed) ever. The politicos are already dancing around this saying how "middle class" people will not have an increased chance of audit.
Take the tin foil hat off and quit spreading this FUD.
The budget for the IRS has been continually slashed since Reagan despite all research on the subject showing increasing funding to the IRS funding increased revenue well beyond it's cost. The IRS has publicly stated on a number of occasions they do not go after the wealthy because they do not have the resources to win in the ensuing legal battles. This leaves the poor and middle class as the only groups they can targ…
This is 100% the story. The IRS can help make sure everyone is playing fair if we sufficiently fund them. And they can stop policing all the little issues and go after the big ones if we sufficiently fund them. AND sufficiently funding them is expected to increase tax revenue above the cost of funding them . It's the most obvious and should be the most bipartisan approach. It's introducing no new taxes, it's equitabl…
This may explain why (it is from the National Taxpayer Advocate Erin M. Collins' annual report to congress): The IRS correspondence audit process is structured to expend the least amount of resources to conduct the largest number of examinations – resulting in the lowest level of customer service to taxpayers having the greatest need for assistance.
Isn’t that kind of the wrong way to structure resources? I could see making a case for either random auditing or for focusing on the largest possible sources of financial error, which surely would trend towards higher income level households.
And we're now going to get 87,000 more auditors. This is the largest increase in the federal police force (they are all armed) ever. The politicos are already dancing around this saying how "middle class" people will not have an increased chance of audit.
Fundamentally if you just pay your taxes, you shouldn't be audited (ideally.) That being said... an increase in auditors is net good because then the IRS can actually audit some of the massive number of tax crimes that occur. This is good.
The Secretary of the Treasury (not current one) was found to have misfiled his return. When asked, all he could say was he put the numbers into Turbo Tax, and this is what it spit out.
I have a family member who gets audited by the IRS every year. They've never found anything, but the harrassment continues year after year.
Once the IRS has these additional people, they will have to use them, and they will have to justify them.
Earlier quoted context omitted.
If we were to try to assess fairness, wouldn't it make sense to also take effects and side-effects into account? Say a disproportionate amount of poor families cheat, but also end up on the street after an audit, either not able to pay any outstanding taxes, or having paid them and no longer being able to afford a roof over their head. At the same time, while breaking the law should be the same for everyone else, wou…
> wouldn't it make more sense to focus on the big fish first? Of course, but the reason they don't is that the tax system is a psychological control mechanism disguised as "doing good" (I make that assertion by looking at the utter amount of careless, unaccountable waste in government despite the endless gaslighting about "muh roads"). Why? Because if you can keep the majority in the psychological bracket of being th…
I hope you mean 10% of the amount of the part of their income that's above the line, and not 10% of their total income. Otherwise, this would cause a horrible welfare cliff.