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"The IRS last year used a profiling test model to study 1,500 tax preparers with histories of reporting deficiencies and managed to recover $200 million. It cited the experience as proof that its data analysis works."
They recovered $200M from 1,500 citizens? That's $133k each. Seems like an extraordinarily large amount.
This is an older article. One of the key takeaways is that Congress in 2008 gave the IRS the capability to dive into your personal affairs online in ways that even the justice department can't (without a warrant). They only need to view you as somebody of interest. Better still, the exact nature of all this -- wait for it -- is a secret. The long-term trend here is pretty clear. Congress has the Big Data hammer out,…
Just standby for the next travesty. What's the specific travesty here? The IRS already looks at and analyzes your private financial data both as reported by you and others and this is generally considered acceptable and a necessary part of them doing their job. So say now they noticed you reported $20k in gross annual income but are buying Ferraris on eBay. It seems pretty reasonable to assume, from that piece of pub…
Earlier quoted context omitted.
No simplified tax code proposal I've read would eliminate the problem of people doing cash transactions under the table, or "loaning" themselves a house and treating that as a business asset.
The Fair Tax would take care of most of that. Any transaction with a business would have sales tax. There are no write offs, so the business asset would not fly, neither would be buying Ferraris. http://www.fairtax.org/site/PageServer?pagename=HowFairTaxWo...
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> It's this kind of writing that drives me crazy. IRS may be overreaching, or they may not be; who knows? Yes, that's the point. Breathless speculation is obnoxious, but that's all we're left with when our government hides its activities from us.
Nobody needed to speculate about what the IRS manual said; it was right there for them to read.
What we don't know—what the article speculates about—is what's in the IRS's databases, how those databases are populated, and the extent of the IRS's claimed powers in audits generally. As with the NSA's secret surveillance program, we're left guessing what's under the IRS's gaze and what oversight, if any, ensures that its scrutiny is circumscribed to what's appropriate in a free society.
Did I understand this correctly? "The IRS last year used a profiling test model to study 1,500 tax preparers with histories of reporting deficiencies and managed to recover $200 million. It cited the experience as proof that its data analysis works." They recovered $200M from 1,500 citizens? That's $133k each. Seems like an extraordinarily large amount.
Going after only high income citizens might also create a reasonable situation where $133k/taxpayer in their biased sample set might happen. It's often not unreasonable to focus only on those individuals who might produce the largest numbers...
Earlier quoted context omitted.
The Fair Tax would take care of most of that. Any transaction with a business would have sales tax. There are no write offs, so the business asset would not fly, neither would be buying Ferraris. http://www.fairtax.org/site/PageServer?pagename=HowFairTaxWo...
Every time I've looked at the Fair Tax proposal, I've been underwhelmed and thought the name was the same sort of anti-nomer as the Patriot Act. But maybe you can change my mind. It's a tax on buying. Think about that for a moment. Fair Tax proponents claim that the current tax system causes disincentives for things like exports and U.S. manufacturing. Why would the Fair Tax proposal then not cause a disincentive on…
Corporations are owned by people (consumers as you call them), tax the person, not the intermediary.
And in any case the corporation would also have to pay the tax on everything they buy.
Earlier quoted context omitted.
The Fair Tax would take care of most of that. Any transaction with a business would have sales tax. There are no write offs, so the business asset would not fly, neither would be buying Ferraris. http://www.fairtax.org/site/PageServer?pagename=HowFairTaxWo...
The Fair Tax would "take care of" neither of the examples tptacek gave... Like all other sales tax proposals, it relies on voluntary reporting of sales. Want to cheat the IRS? Just don't tell them about it.
This might help your customers, but it doesn't help you (unless you charge the sales tax and don't forward it). So the cheating incentives are much lower.
Earlier quoted context omitted.
No simplified tax code proposal I've read would eliminate the problem of people doing cash transactions under the table, or "loaning" themselves a house and treating that as a business asset.
The Fair Tax would take care of most of that. Any transaction with a business would have sales tax. There are no write offs, so the business asset would not fly, neither would be buying Ferraris. http://www.fairtax.org/site/PageServer?pagename=HowFairTaxWo...
"With the prebate program in effect, those earning less than $15,000 per year would see their share of the federal tax burden drop from -0.7 percent to -6.3 percent. Of course, if the poorest Americans are paying less under the FairTax plan, then someone else pays more. As it turns out, according to the Treasury Department, “someone else” is everybody earning between $15,000 and $200,000 per year. The chart below compares the share of the federal tax burden for different income groups under the current system and under the FairTax. Those in the highest and the lowest brackets will see their share decrease, while everyone else will see their share of taxes increase."
Earlier quoted context omitted.
Every time I've looked at the Fair Tax proposal, I've been underwhelmed and thought the name was the same sort of anti-nomer as the Patriot Act. But maybe you can change my mind. It's a tax on buying. Think about that for a moment. Fair Tax proponents claim that the current tax system causes disincentives for things like exports and U.S. manufacturing. Why would the Fair Tax proposal then not cause a disincentive on…
Tax already has an effect on demand - it reduces income, which reduces available money. This just makes it more obvious. Corporations are owned by people (consumers as you call them), tax the person, not the intermediary. And in any case the corporation would also have to pay the tax on everything they buy.
Earlier quoted context omitted.
It wasn't well established. Income tax had been found to be unconstitutional. An "excise tax", which was the same thing, was implemented as a workaround. The income tax amendment eliminated the unconstitutionality decisively and was championed by the Prohibition movement.
> Income tax had been found to be unconstitutional. No, it hadn't. As I stated earlier (and cited the case in which the decision was made), tax on certain forms of income (specifically, income from sales of property) was ruled to be a direct tax requiring apportionment under the Constitution. > An "excise tax", which was the same thing, was implemented as a workaround. Presumably, this is a reference to the Corporate…