I guess this is the year to screw
up your taxes and probably NOT get caught. The IRS has been hit by funding
cuts; so the chances of being audited are the lowest in at least a decade. More
people are filing tax returns, but the IRS is auditing fewer filers’ as the
agency’s budget and staffing drops. Who exactly is this good news for? We all
hate being audited but we like to hear that our government agencies are being
run well too. The number of revenue agents have dropped too resulting in a drop
in the percentage of the returns that are audited. Revenue agents have focused
their efforts on higher-income filers but audit coverage is still down.
After rising steadily from
2005-2010, the number of IRS audits for individual taxpayers fell 21% during
the succeeding five years, the data show. Audits fell in every individual category
and across income levels even as the number of individual tax returns filed
rose in all but two of the past nine years. The audit declines coincide with
recent drops in IRS funding and a steady falloff in revenue agents. It also
comes as the tax agency seeks congressional approval for a fiscal year 2016
budget hike after being buffeted over dwindling taxpayer services and
allegations it targeted conservative tax-exempt groups for increased scrutiny.
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IRS Commissioner John Koskinen
conceded that the agency is “not the world’s most beloved.” But he warned that
the audit rate decline could eventually “corode” American’s faith in the
federal tax system and undermine voluntary payment compliance. “At this point
we do have a tax compliance ethos and people pay their fair share.” said Koskinen
who was to address the audit problem in a speech to the New York State’s Bar
Association’s tax section. It is a problem if you know someone who is not
paying their share of taxes according to law.
Arguing for additional budget
funding, Koskinen cites IRS data that show restoring the number of revenue
agents would produce nearly $1.3 billion dollars in new government enforcement
revenue once new hires complete training and reach full working potential in
fiscal year 2018. When asked whether the IRS could shift workers from other
jobs to revenue agent jobs, he said auditors require time-consuming
training. Also, the tax agency’s overall personnel count is down 13,000, a
total that will rise to an estimated 16,000 this year, he said.
So, as I see it, Congress and the
Senate Committee on Finance is telling the tax guys screw you we will not
finance you as long as you audit our special interest groups. To me it looks
like blackmail and one hand washes the other and tit for tat tactics are alive
and well in politics and on Capitol Hill. Let’s not do what is good for the
country, let’s take care of ourselves mentality is running rampart all over
Washington and it is disgusting.
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