Posted on 07/18/2002 5:46:22 AM PDT by CounterCounterCulture
Edited on 04/13/2004 3:29:36 AM PDT by Jim Robinson. [history]
SACRAMENTO - A day after announcing he'd banked $31 million for his campaign, Gov. Gray Davis on Wednesday bemoaned his own financial status at an appearance before the National Guard.
Republican Bill Simon, a wealthy investment banker, came under fire last week after the IRS began investigating a firm that devised ways to reduce his and other clients' taxes.
(Excerpt) Read more at bayarea.com ...
Of course we know that, Governor. That's why you publish your tax returns (don't you?). . . and you exploit a smear of Simon, because we really don't know what "shelters", if any, Simon actually employed. All we know is that Simon looked into the matter of legally minimizing his tax liability.
After you are finished [preparing your taxes],
you don't know if you are a cheat or a sucker. -- Will Rodgers
Perhaps if the guy HAD tax shelters ... or any REAL income (not generated by the government), he would know how to manage money and we wouldn't have a $24 billion deficit.
Remember, folks, Davis turned a $10 billion surplus into a $24 billion deficit -- that's a turn-around of $34 billion dollars, more than one-third of the current budget of $99 billion.
Senator McClintock has pointed out that if spending increased at the rate of inflation plus population (about 5%), we would have a SURPLUS not a DEFICIT. Instead, Davis and his liberals and a few traitorous Republicans increased spending by 37% in the first three years of his administration. They had a party at taxpayer's expense. And who has to clean it up?
We do!
Tell Davis the party's over.
The IRS Out of Control
We knew the Internal Revenue Service's tax-collection arsenal included, among other things, the legal right to audit, sue and penalize tax cheats. But until last week we didn't know the agency had license to gratuitously humiliate innocent taxpayers in the process.
On Friday, the Journal reported on page one that the IRS has disclosed the names of hundreds of citizens engaged in what amounts to tax planning. These individuals -- many of them prominent businessmen -- are accused of no wrongdoing. Their only sin is that they are clients of KPMG, the accounting firm currently doing battle in court with the IRS.
Last week the Justice Department sued KPMG on behalf of the IRS. The government alleged that some of KPMG's tax shelters are illegal and requested the names of clients who had inquired about them. The accounting firm complied, providing the names in a so-called "privilege log" to protect their identities. The IRS promptly went public with the names, blithely smearing the reputations of innocent third-party individuals in an effort to strong-arm its court opponent and embarrass its clients.
This is a dangerous and outrageous precedent. To begin with, not all tax shelters are illegal, and a court has to rule on the ones in question. Nor is it against the law to minimize one's tax burden. In fact it's common sense, and private citizens shouldn't be smeared in government press releases or news leaks for trying.
But the real potential damage here is to the assumption of privacy among taxpayers. Our tax system works because people are willing to disclose highly confidential information regarding investments, charitable contributions, estate planning and so on. That willingness is linked inextricably with an understanding that these disclosures will be kept secret. Keeping this confidence encourages compliance. Abusing it in the manner of the IRS's KPMG disclosures can only have the opposite effect. "This is unprecedented and it's fundamentally wrong," says Kathryn Keneally, a tax expert at the American Bar Association.
Section 6103 of the tax code is the basic provision that protects the privacy of tax returns. And in the past, the IRS has interpreted 6103 as "broadly inclusive" and "sweeping in nature." When groups like the Landmark Legal Foundation and even Members of Congress have sought the identities of tax-exempt organizations or audit targets, the IRS has argued that it was duty-bound to protect taxpayer identities.
But protecting privacy apparently is no longer a concern when the IRS is a plaintiff. These days, the agency would have us believe that publicly shaming a target's clients is fair game in establishing a case against the target.
Tax experts are debating whether the IRS disclosures are in fact illegal, but Donald Alexander, a former IRS commissioner, says it doesn't matter. "Even if releasing these names is permissible under law, it's still inadvisable," says Mr. Alexander. "You do not release names of individuals to the public unless there's an overwhelming reason to do so, and I find that reason lacking here."
The IRS has also left itself naked to charges of political partisanship. Justice's lead litigator on this matter is Stuart Gibson, a well-known Democratic activist in Virginia. Among the names disclosed last week was William Simon Jr., a Republican who happens to be in the middle of a gubernatorial race in California. Mr. Simon's opponent, Democrat Governor Gray Davis, immediately pounced on the disclosure. A major Bush campaign contributor and a recently appointed U.S. ambassador also were sideswiped. Respecting the confidentiality of tax returns is a good way to avoid the appearance of political bias.
Not long ago, Congress was curtailing IRS abuses. Perhaps post-Enron, the tax man feels as if he can once again get away with anything, even harassing honest Americans. The agency falls under the purview of Treasury Secretary Paul O'Neill and clearly needs adult supervision. He might start by firing or sending to Siberia whoever was responsible for this abuse of government power.
Bush ought to hand the IRS people that released the names.
Clinto holdovers again. They will stop at nothing to damage any Republican official anywhere!
calgov2002:
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Is this to defend , or to attack, our Jim Robinson and Free Republic?
LOL!
The cheapest two bedroom condo currently available in West Hollywood sells for that much. Add the association fees, and the payments are about the same as for a $300,000 house. (No, given that, I'm not sure why people buy condos either).
The median asking price of a two bedroom West Hollywood condo is a shade over half a million.
The most expensive two bedroom West Hollywood condo is $1,350,000.
I'm not going to say that Gray Davis is rich. He's certainly not as rich as Simon, who has an immaculately maintained palace of a home in Pacific Palisades. (Being a bit of a real estate buff, I had to look.) But he's not poor, either. He's probably sitting on a nice capital gain on his condo.
In fact, between the mortgage interest deduction and the one-time tax exemption for capital gains when selling your first home, Davis is sitting on a pretty nice tax shelter there.
Oh, the irony.
D
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