Tax Audits and Threats of Audits Are No Laughing Matter http://t.co/b41XpPqgnk – IRS not the enforcer of the Obama or any administration
— U.S. Citizen Abroad (@USCitizenAbroad) May 14, 2013
This must read article includes:
Our income-tax system is based on voluntary compliance and honest reporting by citizens. It couldn’t possibly function if most people decided to cheat. Sure, the system is backed up by the dreaded IRS audit. But the threat is, while not exactly hollow, limited: The IRS can’t audit more than a tiny fraction of taxpayers. If Americans started acting like Italians, who famously see tax evasion as a national pastime, the system would collapse.
One reason why Americans don’t act like Italians is that they see the income-tax system as basically fair in execution. A tax audit or a tax-fraud prosecution is still seen, usually, as evidence that someone has done something wrong. If it comes instead to be seen as “just politics” then the moral component of the system will be gone. For the system to work, people have to believe that it is fundamentally fair.
This is why the IRS is so strict with its own employees. Paul Caron, a professor at the University of Cincinnati who writes the TaxProf blog, noted in response to Mr. Obama’s remarks that the law calls for the termination of IRS employees who make audit threats for illegitimate reasons. He suggested that Mr. Obama’s “joke” might be grounds for firing if he were an IRS employee.
He’s not, of course, but as the president his words carry much more weight and he should be much more careful. That’s particularly true given that people still haven’t forgotten about the Obama administration’s other tax issues — the appointment of Tim Geithner as Treasury secretary despite an inexcusable failure to pay $34,000 in Social Security and Medicare taxes while working for the International Monetary Fund, and the scandals involving Tom Daschle and others whose appointments failed. (When the Geithner issue came up, news reports indicated that IRS employees were very upset. They can be fired over a simple late filing or a failure to report a mere $500 in income, making Mr. Geithner’s “pass” on much more serious questions quite demoralizing.)
Don’t worry. Steven Miller will fire a few politicians, and replace them with new puppets. Soon, the IRS will be back running the country again.
Hope this doesn’t derail tax reforms.
http://news.yahoo.com/irs-scandal-throws-max-baucus-challenges-tax-reform-092110270.html
Thanks for the link, badger.
Commenters to that yahoo article seem to be calling for “Fair Tax,” “Flat Tax,” Federal “Sales Tax” and abolishing the IRS.
Aren’t US Persons Abroad as well being scrutinized unduly scrutinized by the IRS’ “Form and Penalty” club; the IRS not recognizing our “foreign accounts” are necessary for us to function in the countries we live in; that our non-US spouses are subjected to the IRS unfairly; that Accidentals are punished just for being born to US Citizens Abroad; the OVDI bait and switch; green card holders set up for the big fall?
By all means then, “Fair Tax.” Perhaps they’re right that throwing out the reams of uncontrollable / unfixable Tax Act would alleviate unfairness of the IRS for many segments of US populations, both inside and outside the shores of the US. Perhaps, cut to the chase — a short-cut to what is Residence-Based Taxation in that those who are buying within the US are taxed within the US. Pretty simplistic, but it starts to make more sense.
Right now, CSpan – Congress Begins Investigation…:
http://www.c-span.org/Events/Congress-Begins-Investigation-into-IRS-Targeting-Conservative-Organizations-for-Extra-Scrutiny/10737439699-1/
Watching CSpan – Miller is a bad witness, very evasive. Worth tuning in. Shulman will be testifying Wednesday.
Rep. Jim McDermott, D-Washington defends the IRS saying that “there is a difference between “stupid mistakes and deliberate mistakes,” but do the IRS themselves know the difference?
http://www.cnn.com/2013/05/17/politics/camp-irs-hearing/
Rep Mike Kelly of PA – Great questioning/speech. “I am more concerned after hearing your answers than before I came here today!” My prediction: this is going to escalate!
This is somebody who might be worth contacting. In fact, this is good to watch because it tells us which Congressmen would be sympathetic to IRS abuses.
Rep Tim Griffin – ties complexity of tax code to IRS abuse.
This is great theatre. There are a number of Congressmen who clearly have it in for the IRS based on their abusive behavior. They need to be educated about OVDI, OVDP, etc. Yes, this is a good opportunity.
Opposition to the IRS makes for strange bedfellows.
“I promise the American people this investigation has just begun. Hearing adjourned.”
This is NOT going to go well for the IRS.
I was just going to post that too.
Here is my reply from one US government representative re FATCA (although I am no longer represented as I have renounced):
Apparently this will be replayed tonight at 8:00 p.m. – it is a must see. Also, there is plenty of discussion on Twitter at #IRS. Good opportunity to reply to tweets, etc.
Let’s get involved.
Some have said this underscores the need for tax reform.
Some have said this underscores the need for IRS reform.
An opportunity to not be missed.
The Dem’s portray it as a tempest in a teapot.
I can see Mopsick running for cover.
@Bubblebustin
He won’t be running for cover – guaranteed. His world view is so deeply rooted in the IRS, that he won’t even see this as an issue.
“You can take the man out of the IRS, but you can’t take the IRS out of the man.”
Douglas Schulman will (voluntarily) testify next Wednesday.
Live Blog on Hearing: http://blogs.wsj.com/washwire/2013/05/17/live-blog-lawmakers-hold-irs-hearing/
11:09 am
What were some of the most interesting revelations? Camp: “I think the most interesting revelation was the overall arrogance of the IRS and the lack of information from somebody who was in charge.”
This is not a “tempest in a teapot”. It’s more like a locomotive that starts off slowly and picks up speed until it is going very fast. Only question is what’s gonna be at the end of this train wreck.
Somebody should get in touch with Mike Kelly about OVDP abuses. Perhaps he could ask Shulman about this on Wednesday.
Settle in for an entertaining summer.
The great thing is this: Congress, for the first time ever, is going to have a use for Americans Abroad!
“The great thing is this: Congress, for the first time ever, is going to have a use for Americans Abroad!”
Do you mean if only for bringing the IRS down?
The corrupt sitting in judgement over the incompetent. Spectacle — get popcorn — but I’ll bet it ultimately comes to nothing.
The scoop appear to be: Democrat Senator pressures the IRS to investigate some organizations, and ‘helpfully’ suggests names of those they might want to look at; IRS complies; story comes out. But… Shulman has already gone. Miller was going anyway. And Carl Levin — how glorious that his fingerprints are on this! — has already said he will not stand at the next election.
Confusion and Staff Troubles Rife at I.R.S. Office in Ohio and everywhere else it seems…
What is the answer — throw out all the Tax Code, the loopholes put in by Congress and just start new seems better than any other solution to me.
Bloody nightmare that none of us who have chosen to leave the US should have to deal with. Pay our fair share?!
TGIO — Thank God I’m Out (or almost)!
The headline Tweet includes the comment ” … IRS not the enforcer of the Obama or any administration.”
Really? Has no one else heard that Fabians consider that Tax Policy, Tax Law, Tax Enforcement are tools of “Social Engineering”? and that the “Law is not a Shackle” for them? The US Democrats are following the path of Jamaican Democratic Socialists (though 20 to 40 years behind). BTW is Attorney General Holder not a son of Barbadians? Should he not be paying tax to Barbados? LOL …. and BTW he is probably steeped in the West Indian version of seasoned Democratic Socialism. LOL.