Is Joe Biden Sending the IRS for Your Guns?
I haven’t seen this much paranoia in political circles since the days when leftie-turned-rightie-turned=whack job Lyndon Larouche was hanging around accusing just about everybody and everything of plotting to do evil things.
Everybody from Raisa Gorbachev to Queen Elizabeth to Barack Obama inhabited the world of LaRouche paranoia, which led his acolytes to form alliances with elements of just about any political group willing to tolerate them in exchange for offers of insider intelligence.
Passage of the budget reconciliation bill, aka the Inflation Reduction Act, will impact wide swaths of the domestic economy. Foremost among these will be dramatic improvements in American policies aimed at fighting global warming and improving healthcare.
But, as Los Angeles Times columnist Michael Hiltzik points out, the legislation’s impact on the Internal Revenue Service and the collection of taxes owed the federal government is huge.
One need look no further than Republican delirium over the additional funding headed for the IRS to understand its significance.
House Minority Leader Kevin McCarthy (among others) is claiming the IRS is about to send an army of 87,000 agents to perform 710,000 audits on Americans who earn less than $75,000. This claim has garnered the Washington Post’s prestigious Three Pinocchios rating for lack of a factual basis.
In a May report, the Government Accountability Office (GAO) said audit rates have declined dramatically for the uber-rich. In 2010, more than 21 percent of tax returns reporting more than $10 billion in income were audited — and that dropped to 3.9 percent by 2019, GAO said.
The report also said audit rates for people filing the earned income tax credit — which is for the working poor — were higher than average. That’s largely because audits related to the credit require few resources and are relatively easy to complete. More than half of the agency’s audits in 2021 were directed at taxpayers with incomes less than $75,000, the IRS says.
The 87,000 number being bandied about includes clerical employees and IT technicians, among other non-agent personnel, over a ten year period. Furthermore, 50,000 IRS employees are eligible for retirement in the next five years.
80% of IRS audits of individuals in 2019 were simply through correspondence — in effect, a written request for some additional information.
A key part of the GOP plan to undermine American institutions involves starving them of the resources needed to perform the tasks expected of them.
Later disproven claims by San Diego Congressman Darrell Issa a decade ago about IRS audits targeting conservative nonprofits led to a $1.5 billion reduction in the agency’s budgetary request.
Issa’s claims had the desired effect. The agency has apparently decided that enforcing the rules concerning nonprofit spending in elections isn’t worth the hassle. One need look no further than the National Rifle Association for how this has impacted domestic politics, according to a report from CitizensforEthics.org published in April of this year.
A couple of decades of neglect have already cost the IRS 10% of its workforce, leaving the agency without the resources to quickly process returns, and winnow out the complex tax-avoidance strategies of well-heeled individuals.
Each budget cut, whether measured in real or inflation-adjusted dollars, hamstrung the agency’s ability to do its job. Taxpayer services shrank, callers with even ordinary questions were placed on hours-long holds — if they could get through at all. This lowered the agency’s public reputation to a subterranean level.
Who benefited? The rich, that’s who. Audits of the wealthy became an endangered species. In 2010, the audit rate of personal tax returns reporting income of $10 million or more was 21.2%. By 2019, the Government Accountability Office reported, it had fallen to 3.9%. This in a period when the number of those returns nearly doubled, rising from 13,000 to 24,000.
The low water mark may have been reached in 2019, when the IRS received more than 23,450 tax returns from households reporting $10 million or more in income for 2018. It audited seven. (Not a misprint.)
The scandal, at least from the point of view of the people who get paid to lie about taxes, is the 15% minimum corporate tax contained in the bill. This means that corporations will have to report the same numbers to both the IRS and shareholders. How unseemly!!
The accounting profession is scandalized by the very idea. The American Institute of Certified Public Accountants says the principle “violates numerous elements of good tax policy and may result in unintended consequences,” although it would seem that the main consequence, which is higher tax collections from corporations, is quite openly intended by the drafters of the act.
Let me tell what a real scandal would be, namely reforming our tax collection system so taxpayers wouldn’t have to pay software and accounting companies to fill out tax forms. In some countries, the government sends out a bill to each citizen with estimated taxes due (or not); paperwork is only required in cases where there is disagreement over the estimates.
***
In case you have missed out, the entirety of the MAGA right is now complaining about the Federal Bureau of Investigation. Since they are incapable of avoiding racist references, the most common denunciations from these types universally make some comparison to Third World countries.
***
Of course, if Republicans REALLY wanted to have a discussion about how much we spend on law enforcement and whether it’s bringing us the desired results, they could always run for office with that notion as part of their platform….LOL.
Email me at WritetoDougPorter@Gmail.com