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Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

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Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#91

Post by janalsncm »

alfalfasprout wrote: post #18

Taking a step back... one big problem is that our tax code is way too complex. It means that even common people are wading through a minefield every time they file their taxes. Between unclear deductions and credits, trickiness for those that have to pay estimated taxes, and a mafia led by Intuit lobbying against simple filing it's definitely a pay to play system. More broadly, our tax code is designed to benefit the…

There’s a good book “The Dictator’s Handbook” that proposed the Selectorate Theory that explains this, among other things. The complex tax code is a feature, not a bug. And I don’t just mean that Intuit is profiting off of the complexity, although that is also true.

Politicians care about staying in office, rewarding their supporters, and maybe implementing prosocial policies. In that order. So tax cuts for the wealthy aren’t because they think it’s good for the economy, they are kickbacks for support.

Every single tax deduction and carve out is a reward to the winning coalition at a particular time. We see this with farm subsidies, which are more of a vestige at this point, but at one time farmers were an important demographic. When politicians get into office they reward their supporters.

The book is a lot better than I am at explaining it all, so I recommend reading it or watching the Rules for Rulers video on YouTube.

Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#92

Post by h1srf »

mdorazio wrote: post #47

I’ll share my story. The IRS incorrectly sent me a fine for over a thousand dollars claiming I had filed late. I tried calling them 9 times on different days to dispute it. Within a minute of opening, end of day, middle of the day, didn’t matter. Not even a wait line, just “sorry try later.” I finally gave up and paid the damn thing then got a refund for the fine over a year later when I guess they figured out it was…

I had a similar issue where they claimed I didn’t pay one year. Calling led nowhere but my CPA friend said send them a letter. As in a physical snail mail dispute letter. I could be wrong but I think they have to reply within a certain amount of time even if the reply is “we’re still looking into it”. 6 months later I got a letter saying basically I was correct and you don’t owe anything.

Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#93

Post by [deleted] »

silisili wrote: post #29
genter wrote: post #8

Earlier quoted context omitted.

One of the major parties is deliberately sabotaging it (along with USPS, FDA, and NOAA) so they can point out how useless it is and it should just be shut down.

Don't forget the USCIS. It takes a lot of time, patience, and skill to navigate the phone tree in a way that doesn't either end the call immediately, or tell you to visit the website and then end the call. I had a paper and pencil marking my choices so I'd remember what I'd tried, and it was nearly full by the end.

[deleted]

Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#94

Post by chrisco255 »

HillRat wrote: post #5

The IRS is a perennial budgeting football for Congress, even though it's one of the few agencies for whom increasing their budget creates positive net revenue for the federal government; its enforcement arm is down 30% in staffing since 2010, with predictably dismal results. As an anecdotal comparison, I had a fairly long-running issue years ago with the IRS over a minor problem (some expenditures got posted to one f…

A better strategy would be to do away with income tax altogether and replace with something easier to comply with and enforce like a Federal sales tax. States that run on sales tax alone need only to collect revenue from businesses, which shrinks their staffing requirements. And since it's a straightforward % of sales, it's easier to audit as well.

Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#95

Post by hydrogen7800 »

anon291 wrote: post #74
gmd63 wrote: post #24

Earlier quoted context omitted.

That's thinking inside the box of extremely low-effort propaganda. The IRS is critical to stopping fraud and making sure everyone plays by the rules. Currently, we have folks not respecting the rules and getting more economic influence than they deserve. The current climate is an effective tax on honesty. As long as budget increases to the IRS increase revenue to the government, they should keep growing. If you take…

> As long as budget increases to the IRS increase revenue to the government, they should keep growing. Why? The government is not a business. They should not be interested in 'raising revenue'. They should be interested in helping their constituents grow rich; not taking their wealth.

I think in this case, the IRS "raising revenue" up to the amount they "should" be getting based on the current tax law is a good idea. There is an upper limit.

This then makes me think that tax law may already account for "under collection", which might cause it to target "over collection". Increased IRS effectiveness can close this gap.

Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#97

Post by ghaff »

noodlesUK wrote: post #76
doe_eyes wrote: post #64

Earlier quoted context omitted.

It's a narrative that's easy to believe in because audit rates are going down. But when you think about it... why should be they going up? In the 1980s and before, the IRS literally had no way of knowing if you're telling the truth without auditing you. Everything was done on paper, cash was king. So the audits were indiscriminate and invasive, and needed a large army of employees to orchestrate. Now, the IRS knows a…

> Now, the IRS knows almost everything about your finances. They get electronic data from your employers, your bank, your brokerage. Most of commerce is settled electronically. Paypal and Venmo send them your info if you receive more than $500 in a year. There is nothing to be gained by randomly auditing the average family if the numbers on their report match what the IRS knows. The IRS can zero in on specific activi…

Yeah. If you have at least somewhat complicated taxes, you have at least somewhat complicated taxes. But a lot of people don't. If someone only has a W-2 and maybe a 1099, they're probably covered. Even mortgage deductions are less common these days.

Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#98

Post by mywittyname »

pembrook wrote: post #88
jmclnx wrote: post #37

Earlier quoted context omitted.

I had friends and relatives who worked for the US IRS in the 80s, they all would say the IRS was the one place that budgets will never be cut, so the felt far more secure than I did in Tech. Little did they know the top 1% would get with one specific US Political Party to cut the IRS budget so thy can all cheat on their taxes. It is cheaper for them to hire lawyers than to pay their "fair share".

If the IRS budget since the 80s hasn't decreased on a per-capita, inflation-adjusted basis, then something has gone horribly wrong. Why the heck would we want tax collection to get more inefficient every year? This one of the most misguided narratives I see from people of the other "specific US political party" to the one you're referring to. As another commenter pointed out, if the transition away from cash and self…

> Why the heck would we want tax collection to get more inefficient every year?

There is a subset of Republicans who believe that taxes should be painful. They should be constantly front-of-mind for every American. It keeps people from forgetting about income taxes and having them fade from public discourse.

Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#99

Post by mbrumlow »

chrisco255 wrote: post #94
HillRat wrote: post #5

The IRS is a perennial budgeting football for Congress, even though it's one of the few agencies for whom increasing their budget creates positive net revenue for the federal government; its enforcement arm is down 30% in staffing since 2010, with predictably dismal results. As an anecdotal comparison, I had a fairly long-running issue years ago with the IRS over a minor problem (some expenditures got posted to one f…

A better strategy would be to do away with income tax altogether and replace with something easier to comply with and enforce like a Federal sales tax. States that run on sales tax alone need only to collect revenue from businesses, which shrinks their staffing requirements. And since it's a straightforward % of sales, it's easier to audit as well.

All fine and dandy until somebody can’t stand that somebody makes more than them and wants to point out that because you make more and maybe even spend less that your overall tax to income rate is smaller than somebody else.

Taxes are not just about revenue. It’s a political tool first. As the US government could just print money and dilute the value of the dollar as the tax.

Recent moves that show it is political. Trump administration changed rules on how income is reported that affected blue states with high house prices and income tax without affecting red states with sales tax and low house prices much, by way of limiting the deduction of interest paid and state income tax on your federal tax bill. Meanwhile the current administration often says how bad trumps “tax cuts” where without even trying to undo the increased taxes on blue states.

Re: Millions of Taxpayers Call the IRS for Help. Two-Thirds Don't Reach Anyone

#100

Post by b112 »

chrisco255 wrote: post #94
HillRat wrote: post #5

The IRS is a perennial budgeting football for Congress, even though it's one of the few agencies for whom increasing their budget creates positive net revenue for the federal government; its enforcement arm is down 30% in staffing since 2010, with predictably dismal results. As an anecdotal comparison, I had a fairly long-running issue years ago with the IRS over a minor problem (some expenditures got posted to one f…

A better strategy would be to do away with income tax altogether and replace with something easier to comply with and enforce like a Federal sales tax. States that run on sales tax alone need only to collect revenue from businesses, which shrinks their staffing requirements. And since it's a straightforward % of sales, it's easier to audit as well.

I have no issue with billionaires, and don't resent their cash. But if you drop all income tax, and do only sales tax you'd miss a lot of their income.

Same for the moderately wealthy too.

I suspect you'd need 100% or even 200% sales tax to capture what you so now.

That's going to lead to black markets, reduced economic output, etc too.

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