Mr. Harper will expose innocent Canadians to the capricious and evil treatment of the IRS. Just how bad is it? The IRS is a criminal organization that regularly abuses elderly people, just like our beleaguered Canadian citizens whose bank accounts will now be exposed to the IRS under FATCA. Read what one insider has to say. Powerline blog reproduces a letter by Bill Henck an IRS insider (emphasis mine):
Bill Henck: Inside the IRS
I have been an attorney in the IRS Office of Chief Counsel for over 26 years. Over a number of years, I have attempted, largely unsuccessfully, to alert the public to abuse within the IRS. One of my kids suggested that I contact a blog and Power Line has graciously agreed to publish this account.
I do not personally know whether the IRS has targeted conservative groups or individuals, but I do know that the environment within the agency is ripe for such activity and there is nothing to prevent it from occurring. As stated in more detail below, I have personally witnessed improper giveaways of billions of dollars to taxpayers with inside access at the agency, bullying of elderly taxpayers, the cover-up of managerial embezzlement and misappropriation of thousands of dollars in government funds, and a retaliatory audit. I have also heard credible accounts of, among other things, further improper giveaways, blatant sexual harassment, and anti-Semitism. All of these matters have been swept under the rug.
A number of years ago, a manager in my office was embezzling thousands of dollars in travel funds. His actions were common knowledge, but other managers, including a currently high ranking executive in the office of chief counsel, did not report him. I did report his conduct to the Treasury Inspector General for Tax Administration (TIGTA), but they did not investigate the matter for a considerable length of time. After I complained to my local congressman’s office, TIGTA finally forwarded the matter to the office of chief counsel to be handled internally. Eventually, the office of chief counsel made the manager pay the money back, but took no other disciplinary action, even though others who committed the same type of scheme were punished severely.
The manager in question has led a charmed life. Several years after this episode, he decided to retire, but was starting a new job in a different city two months before he was eligible to retire. He could have retired early or taken annual leave for two months before retiring. However, he did not want to take annual leave because federal employees can cash out annual leave when they retire. Rather than have him burn at least $20,000 in annual leave, the IRS transferred him to the new city, but did not give him any work, allowing him to work his new job while still receiving a government paycheck. I obtained an e-mail from this manager, in which he admitted that he had no work, that the IRS was not planning to give him any work in the new city, and that he was working on matters related to his new job while at the IRS. I forwarded this e-mail to TIGTA, but of course it was ignored by both TIGTA and the office of chief counsel. TIGTA has a well deserved reputation for protecting IRS managers. In fact, a TIGTA agent once stated that “we don’t investigate [IRS] managers.”
At the same time the manager was embezzling travel funds, I was working on a case involving what I call the Elmer’s Glue scam. Tax shelter operators misused a synthetic fuel credit by spraying watered down household glue on marketable coal, degrading the coal, but producing huge tax credits for investors. This was costing the Treasury at least $3 billion a year. The IRS turned a blind eye to this activity and harassed those of us in the agency who were trying to stop it. Since I had witnessed TIGTA help cover up embezzlement, I decided to go to the press about the Elmer’s Glue scam. The Wall Street Journal published a story about it, but the scam continued.
As a result of complaining about TIGTA’s inaction regarding embezzlement and speaking out about the Elmer’s Glue scam, my wife and I were subjected to a retaliatory IRS audit. After an experienced revenue agent from Fairfax spent an entire day auditing our tax returns, he stated that they were clean. Soon thereafter, he called me and apologetically stated that his “special projects” manager had ordered him to return to Richmond and “keep digging” into our returns. He stated that his regular manager would not have ordered this (I believe that because in 26 years at the IRS, I have never heard of an agent being sent back to continue a straightforward individual return that had been judged to be clean). I contacted the Washington Post and gave them a privacy waiver to discuss our tax returns with the Service. When the Post presented that waiver to the Service, they quickly dropped our audit.
Within the past few years, the IRS has used a “cadre” to pursue a particular type of case. I was assigned one of those cases that was in Tax Court. I believed that we should concede the case in question because our legal position was incorrect. As a result, I was called a quitter and a coward, was threatened with retaliation, and in fact suffered retaliation. The “cadre” (I hate that term, but that’s what they call themselves) pushed cases with an obvious legal defect. Taxpayers were denigrated in writing as “upper class twits” and one cadre member stated that, despite the weakness in our legal position, the taxpayers in these cases were typically elderly and could be forced into settling their cases. I stated my ethical concerns to management, but they answered with a short non-response and did not even bother to ask for the name of the cadre member who stated that we could bully elderly taxpayers into settling their cases. (The Tax Court ultimately rejected the Service’s position regarding the legal issue.)
Finally, there is the matter of black liquor. Black liquor is a byproduct of paper manufacture. Paper manufacturers were able to persuade the IRS to qualify black liquor for a refundable tax credit. This cost the Treasury approximately $6 to 7 billion a year. Congress in fact put a stop to it after tax year 2009. That’s when the real backroom abuse started. Most of the companies reported the refundable credits as taxable income on their tax returns and the position within the IRS internally was that these credits were taxable income. In fact, there is a revenue ruling issued by the IRS that states that farmers with similar refundable credits have to report the credits as taxable income. However, Washington lobbyists met with high ranking IRS, chief counsel, and Treasury Department officials and got the decision regarding black liquor reversed. Taxpayers then filed refund claims with respect to the amounts that they had previously reported as taxable income and the IRS exam teams were told to stand down. This cost the Treasury at least $2 billion for tax year 2009.
I was assisting an exam team involved with this issue. The revenue agents and I discussed the issue with a high-ranking official in the IRS. He told us not to pursue the issue of whether the credit amounts were taxable income. When I asked that he put that instruction in writing, even in an e-mail, since he was asking the exam team to ignore published IRS guidance, he stated that the IRS chief counsel had ordered that nothing be put in writing on the subject. I raised my ethical concerns with management, but was ignored.
I contacted Steve Mufson, a reporter for the Washington Post. Steve wrote a detailed story in July that laid out the abusive situation. The response in Washington was a collective yawn. I contacted numerous congressional staffers and journalists about the story, but no one cared about the $2 billion loss to the Treasury. One result of the story, however, was that it smoked out the IRS. In early November, the Service issued low level guidance called a chief counsel advice (CCA, but it should be a CYA), that attempted to defend the indefensible. In addition, the IRS had contacted the Treasury Department about the CCA prior to its issuance, but did not list Treasury as a third party contact in the CCA, in violation of IRC section 6110(d). I have attempted to simplify a complex subject, but suffice it to say that if you are a farmer, a refundable tax credit associated with an excise tax is taxable income. If you have inside access at the IRS, it is not taxable income. That is the bottom line.
I am reporting the information stated above because as a federal employee, I took an oath to the United States. I have a legal and moral obligation to report this information. I am proud of my colleagues in the IRS. The vast majority of us attempt to do our jobs in a conscientious manner. However, there is a culture of corruption within the IRS that dishonors that majority and the government we serve. Any organization will have its share of bad apples and misconduct. What separates the IRS is its junkyard dog ferocity in covering up misconduct. There is a strong cultural imperative within the IRS to protect the organization and high-ranking officials’ positions within it. If you report misconduct or dissent from the party line, your career is finished. Period. (For example, I still as of this moment have a job, but my career was finished as soon as I reported that manager for embezzlement.)
Some may read this account and view much of the misconduct I have reported as minor. However, to quote former FBI profiler John Douglas, no one wakes up one day and decides to become a serial killer. In other words, there is a pattern to human behavior. All Americans should be concerned when IRS officials see themselves as above the law because they are, in fact, above the law. The misconduct described above is united in the complete lack of accountability on the part of IRS officials.
As stated above, I have no direct knowledge of harassment for political reasons. I fear, however, that the ordinary citizens recounting stories of IRS abuse due to their political beliefs are telling the truth. (It is naïve to think that IRS executives would engage in the activities described above, but somehow draw the line at politically motivated harassment.) If these taxpayer accounts are true, then the IRS executives are doing it for a very simple reason: because they can. There is no accountability for IRS misconduct and people within the agency are scared to speak out and also believe, with considerable justification, that such action would be futile.
I have chosen to speak out in part because I have personally experienced the horrific damage that bureaucratic bullies can inflict. I also have tried to live up to the admonition in Romans 12:21: do not be overcome by evil, but overcome evil with good. I could sit around and knock down Jim Beam and complain, or I could try to do something constructive about the situation. I chose the latter option.
Sickening.
@bubblebustin, Our argument just got that much easier to justify. There is no rightness in the Prime Minister’s position. Only a cynical ploy to maintain the status quo for CDN banks that made some very bad geopolitical risks in their investing for themselves and for their clients.
and how long will Americans take this? Apparently for a long time, as I think they are all doped up on pop culture and sports entertainment (the opiate of the western culture these days, not religion) to pay attention to what even
TIGTA report after report after report tells us about the incompetence, let alone the corruption! There is enough information there to sicken you, without even hearing from an whistleblower from the inside, telling us how the “best and the brightest” in the bureaucracy work!
This is in part why I agree with Petros. RESIST the bastards and don’t give in to their bullying. We live in Canada and have even less reason to capitulate.
@Just Me
Maybe it’s easier for them to be blissfully ignorant, rather than be outraged, yet powerless to do anything, anyway?
I don’t know, except that it seems as though there are too many good people in the world that are unwilling to do anything in the face of evil, and it is indeed very demoralizing when people that are willing to stand up, just get smacked down for the sake of the political asskissing to a foreign government.
I’m still sorting through the confusion. :^(
The IRS has been used as a tool to target people who speak out for decades too. J Edgar Hoover was getting them after Martin Luther King Jr. and every other protest group or organization during that time period was a target of government organizations in many ways. NONE of that was moral, a lot of it was illegal but, it was done anyway.
I have no idea why people think they still don’t do things like this. The favouritism, the sneaky spying, the bending of rules for some but cracking down on those without money or power.
@mjh, it might be easier but, it isn’t the right thing to not stand up and at least say something. Otherwise there’s silence in the face of these sorts of abuses. That is never acceptable. Easier, yes. The right thing? No. You’re not powerless. Nobody can take your power away without your consent.
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http://canadafreepress.com/index.php/article/63802
‘IRS Loses Lerner Emails—But What About the TIGTA Report?’
By Alan Joel June 15, 2014
More evidence of IRS, Treasury and US government hypocrisy.
Ordinary law abiding expats abroad are held to a reporting standard that the IRS itself won’t meet. Those deemed by the US to be ‘US taxable persons’ residing outside the US are held liable to IRS and Treasury demands to collect and keep and turn over whatever years worth of banking, income and other information the IRS demands – at pain of significant penalties, yet their own officials appear to be unwilling to meet reasonable standards of transparency and accountability.
The US government demands our personal and financal data – on legal local assets and earnings with no actual US connection – where expats are citizens and resident in another country, yet it allows its own employees and appointees to stonewall and obfuscate.
Do as I say, not as I do is the motto of the IRS and Treasury.
Might makes right is the motto of the US Government.
http://taxprof.typepad.com/taxprof_blog/2014/06/strong-1.html
Sunday, June 15, 2014
‘The IRS Scandal, Day 402’
By Paul Caron
referring to;
http://online.wsj.com/articles/the-irs-loses-lerners-emails-1402700540
‘The IRS Loses Lerner’s Emails
And other news that the Beltway press corps won’t cover.’
June 13, 2014 7:02 p.m. ET
“The IRS—remember those jaunty folks?—announced Friday that it can’t find two years of emails from Lois Lerner to the Departments of Justice or Treasury. And none to the White House or Democrats on Capitol Hill. An agency spokesman blames a computer crash.
Never underestimate government incompetence, but how convenient. The former IRS Director of Exempt Organizations was at the center of the IRS targeting of conservative groups and still won’t testify before Congress. Now we’ll never know whose orders she was following, or…”..
This posting is boiled down from a series of postings on a message board in Switzerland. Let’s call it:
“IRS: To Serve and Protect (other US Government Employees)”
The IRS publishes Foreign Housing exclusions for three cities in Switzerland:
2010:
Bern: $61,800
Geneva: $84,900
Zurich: $39,219
All other cities: $32,900
These were then raised for 2014 for Bern and Geneva only, but not Zurich or other cities:
Bern: $72,200
Geneva: $100,500
Zurich: $39,219
All other cities: $32,900
The five largest cities in Switzerland are:
1) Zurich
2) Geneva
3) Basel
4) Bern
5) Lausanne
The cantons where the most Americans live:
1) Zurich: 9,460
2) Vaud (Lausanne): 6,013
3) Geneva: 5,868
4) Basel: 3,579
5) Bern: 2,575
Note that cantons Geneva and Bern have the third and fifth highest number of US citizens living in them, respectively.
The average “monthly rent for 85 M2 furnished accommodation in expensive area in” (expatistan.com):
Geneva: CHF 3,326
Zurich: CHF 3,310
Lausanne: CHF 2,871
Bern: CHF 2,585
Basel: CHF 2,500
Note that Zurich is 1/2 of a percentage point less expensive than Geneva for the most expensive and that Bern is 22% less expensive than Geneva for this surveyed category of apartment.
If you are still with me, the most expensive cities are Geneva, Zurich, Lausanne, Bern and Basel, in that order.
Where do US Government employees work in Switzerland?
1) Zurich – US Consular Agency (a few US personnel)
2) Geneva – US Mission and Consulate (lots of US employees)
3) Basel – none
4) Bern – US Embassy (lots of US employees)
5) Lausanne – none
A poster concluded: “Call me cynical but it appears that the US government (IRS) is ensuring that the 2555 earned income and housing exclusions completely cover US government employees’ salaries, who are based almost exclusively in Geneva and Bern. Mere mortal Americans living in Zurich and elsewhere don’t get the same benefit.”