Posted on 10/12/2019 8:01:54 PM PDT by Tolerance Sucks Rocks
You might want to sit down for this one.
If you thought the IRS was just a necessary yet uncomfortable part of American life, here’s some more evidence that it’s simply an arm of the United States government that deserves to be excised.
The IRS just admitted that it audits the working poor at about the same rate as the wealthiest 1 percent. Here’s why, according to ProPublica:
"…the IRS said, auditing poor taxpayers is a lot easier: The agency uses relatively low-level employees to audit returns for low-income taxpayers who claim the earned income tax credit. The audits — of which there were about 380,000 last year, accounting for 39 percent of the total the IRS conducted — are done by mail and don’t take too much staff time, either. They are 'the most efficient use of available IRS examination resources,' Rettig’s report says.
"On the other hand, auditing the rich is hard. It takes senior auditors hours upon hours to complete an exam. What’s more, the letter says, 'the rate of attrition is significantly higher among these more experienced examiners.' As a result, the budget cuts have hit this part of the IRS particularly hard.
"For now, the IRS says, while it agrees auditing more wealthy taxpayers would be a good idea, without adequate funding there’s nothing it can do. 'Congress must fund and the IRS must hire and train appropriate numbers of [auditors] to have appropriately balanced coverage across all income levels,' the report said."
(Excerpt) Read more at selfgovern.com ...
PING!
IRS—— Internal Robbery Syndicate
SEX - You need consent.
TRADES - You need consent.
PURCHASES - You need consent.
TAXES - ???
Kinda makes sense given the high rate of fraud in returns claiming the earned income tax credit.
I first learned about this policy when Jimma Carter was President and his IRS was targeting small businesses because they couldn’t afford to fight back.
He said that's actually not true, and for similar reasons that wealthy taxpayers may audited less frequently than low-income filers:
1. Wealthy people have a lot of income, but they also pay accountants who are tasked with filing forms correctly and reporting any income that has a paper trail.
2. Many established cash businesses (restaurants, for example) may under-report their income, but the IRS doesn't see them as prime targets because they DO pay taxes -- and their tax returns typically correspond closely to their documented "non-cash" income and expenses.
The type of business the IRS targets for audits, according to this guy, is a small cash business -- often owned by recent immigrants -- that has terrible records (if any), pays employees cash, never reports these employees for payroll tax purposes, and often has multiple family members working in the business as allegedly "unpaid" owners. These are great targets for the IRS because with one audit the IRS can find a lot of unreported income from many places -- from the business, the owners, the employees, and even the suppliers.
Ping
This is why the tax code needs to be simplified.
When Demonrats says “A simple tax code is not progressive” what they are saying is that they want a tax code that allows them to threaten and oppress the middle class and poor.
+1.
The legendary Mrs. Whiskers is similar.
I’ve always been a proponent of having a tax code that allows you to file on a form no bigger than a postcard. But that won’t happen in this incarnation of the Republic. Too many subsidies, programs, handouts, and otherwise general pigs at the trough. Let’s face it - this country is going to collapse under the weight of it’s own greed, graft, grand larceny, and self-interested, ‘me first’ third parties. Part of me wants to live long enough to watch the inevitable and gloat, but another part doesn’t want to be around to try and claw my way out of the rubble. Everything folks like us have tried to do in the last fifty years has been nothing more than putting another Band Aid on a gushing artery. And don’t bitch about me being another defeatist throwing in the towel - open your eyes wide enough, and you’ll start seeing the trees and not the forest. Our future was bought and paid for generations ago. As Mencken said a century ago, an election is just an advanced auction of stolen goods. As is was then, as it is now. Imagine a Sanders or Warren in the White House, with a Congressional majority. They might as well mandate the distribution of cyanide capsules.
My dad used to own several H&R Block franchises areas with lots of minorities so they did a lot of returns that claimed the earned income tax credit. First, the EITC isn’t a tax credit, it’s welfare. For you to get a tax refund or credit you actually have to have paid something to get back, the EITC allows you to get a “refund” of thousands of dollars while having paid no taxes to begin with. From my estimation about 75% of the returns claiming the EITC are fraudulent. At the time my dad was in the business you had to have dependent children to claim the EITC. The IRS would allow you to claim a child or grandchild, but not a niece/nephew, cousin, etc. There was a loophole however, they’d accept the un-defined term of “fosterchild” so most of those coming into my dad’s office were claiming a fosterchild as justification for the EITC. It was pretty easy to tell that most had never met their fosterchildren when you’d see people outside the office selling social security numbers for $50 a pop and people walking in with them on a slip of paper to give to the preparer. My dad informed the IRS of what was going on and was told that it was none of his business, his job was to put down what the client told him.
The EITC racket is full of fraud so if the IRS is concentrating on auditing those claiming it then it’s about time. There’s no telling how many billions of dollars are scammed with it every year.
I’m an old-fashioned traditionalist in the the classic way, but I’m no chauvinist. I freely admit that there are certain areas in the domestic/financial arena that women are simply better suited for than us men. And I salute them.
“So, she got out the long form and itemized every last deduction from that year, probably right down to my beer tab, attached all the receipts, then sent it back to them.”
That happened to me one year...
The earned income tax credit is rife with fraud...the IRS needs to look at it/audit even more!
I wish every FReeper reading that line would pause for a moment and consider exactly what it means.
Why is the "rate of attrition" significantly higher among the "more-experienced" (and presumably higher-ranking) examiners? Does perhaps their dearly-earned prowess / special know-how make them candidates for work in the private sector? Maybe as tax consultants to the rich and powerful?
Regards,
Makes perfect sense. The highest fraud rate in tax returns is claiming the “Earned Income tax Credit” by pretending to have kids that don’t exist. A tax return preparer told me his biggest problem working in the poor areas of Arizona was the number of folks claiming “daughters” who were nieces living in Mexico with their real parents. They split the $$$ with the Mexican family.
The EITC can add $6000+ to a “refund”. The fraud is estimated to be 25-30% of claims.
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