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House GOP votes to gut IRS budget

Unitedwestand13 said:
i fail to see how gutting the budget of the governments tax collection agency is going to solve the countries money troubles
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Its part of the announced goal of making government so small they can drown it in a bathtub.
 
ludin said:
as you request here it goes.
IRS Can't Collect Billions in Unpaid Taxes - ABC News

quite a bit of that is from government staffers who haven't paid their taxes.

this is the best of all
IRS workers who didn't pay taxes got bonuses
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I'm torn - clearly, there's a need to enforce tax laws and investigate those who don't, but if those who are tasked with the job are also some of the ones who need to be investigated, then perhaps cutting their funding is the first step to getting things cleared up.
 
CanadaJohn said:
I'm torn - clearly, there's a need to enforce tax laws and investigate those who don't, but if those who are tasked with the job are also some of the ones who need to be investigated, then perhaps cutting their funding is the first step to getting things cleared up.
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that is just the tip of the iceburg there are hundreds to thousands of federal workers that haven't paid taxes yet.
to me that should be an auto firing. there is no reason that you should be able to work for the federal government and not pay your taxes.

Federal workers owe the IRS $3.3 billion - May. 23, 2014
 
ludin said:
that is just the tip of the iceburg there are hundreds to thousands of federal workers that haven't paid taxes yet.
to me that should be an auto firing. there is no reason that you should be able to work for the federal government and not pay your taxes.

Federal workers owe the IRS $3.3 billion - May. 23, 2014
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I agree with you - if you committed any other crime, your job would surely be in jeopardy if not automatically lost. I do find it odd though, that sufficient withholdings aren't the norm. Seems to me another example of government incapable of managing the affairs it is tasked with.
 
CanadaJohn said:
I agree with you - if you committed any other crime, your job would surely be in jeopardy if not automatically lost. I do find it odd though, that sufficient withholdings aren't the norm. Seems to me another example of government incapable of managing the affairs it is tasked with.
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yep pretty much. or the fact they have withholdings taken out and they have never filed. which is just as bad.
 
So the forces of the right cut the ability of the government to collect tax revenues and then they will complain about the governments budget at the same time after undertaking this very action which will contribute to the problem.

Got it loud and clear.
 
CanadaJohn said:
I agree with you - if you committed any other crime, your job would surely be in jeopardy if not automatically lost. I do find it odd though, that sufficient withholdings aren't the norm. Seems to me another example of government incapable of managing the affairs it is tasked with.
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It's not really a crime to owe money to IRS any more than it's a crime to be late on your Mastercard payment. There are a lot of reasons why individuals get into trouble - divorce, disputes about who claims a dependent, simple errors (forgetting to include a 1099 or math errors), and just getting into a financial bind and unable to pay the taxes owed when due. Many times the IRS will assess penalties in error, but until resolved will show the taxpayer as delinquent.

Here's a look at penalties, etc. There were 38 million penalties assessed last YEAR, and about 5 million abated. Few of those assessed were for criminal acts -= fraud - and almost all of them made simple mistakes or just had life intervene with perfect compliance. I have to respond to penalty notices as part of my job - there is almost no correlation between those who have problems with IRS and honesty/integrity. Many who are in financial trouble elsewhere also get into arrears with IRS, same as their power bill, phone bill, rent, etc.

SOI Tax Stats - IRS Data Book
 
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JasperL said:
It's not really a crime to owe money to IRS any more than it's a crime to be late on your Mastercard payment. There are a lot of reasons why individuals get into trouble - divorce, disputes about who claims a dependent, simple errors (forgetting to include a 1099 or math errors), and just getting into a financial bind and unable to pay the taxes owed when due. Many times the IRS will assess penalties in error, but until resolved will show the taxpayer as delinquent.

Here's a look at penalties, etc. There were 38 million penalties assessed last YEAR, and about 5 million abated.

SOI Tax Stats - IRS Data Book
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I agree there are a lot of reasons why an individual may be in arrears on their taxes. However, if you work for the federal government and particularly if you work for the IRS, there seems to me to be very few legitimate reasons why you would be. In addition, as your employer, the IRS has a pretty easy way of getting at your salary if you don't pay. As for it being a crime, I'd be strictly referring to anyone employed by the government who did not file a tax return - there's no excuse for that.
 
Unitedwestand13 said:
so giving a agency less money that it asked for in order to do it's basic job somehow removes corruption?
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Seems logical to me. The less government does, the less corruption is involved. If less money means the government does less, I would view that as very positive.
 
JasperL said:
Cutting IRS budget is just a green light to tax cheats. The shortage will be felt at the individual level when ordinary people that call can't get someone to answer the phone, the computers send out a notice that's wrong and they can't get it taken care of, or find out why it was sent, it takes 6 months to respond to a letter, etc. I deal with them all the time, and cutting their budget just creates a lot of dead weight as people spend hours dealing with an agency that's purposely underfunded and understaffed.

It's just a terrible idea from top to bottom, and worse than it being a bad idea, it wouldn't even begin to solve the supposed corruption problem. The people affected by the cuts won't be the people in IRS HQ in DC, but thousands of ordinary employees just doing a necessary and thankless job, and the millions of Americans dealing with IRS as part of life as a citizen.
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Well maybe the Obama administration should have considered the repercussions of illegally targeting American Citizens based on their Political views.
 
voyager1 said:
I love how it was a voice vote, in other words no record for when campaign season is in full swing. Just reinforced the "phony scandal" bit.
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You need to cool it with the false meme. That's been debunked for months. There is no doubt the scandal is real at this point.
 
haymarket said:
So the forces of the right cut the ability of the government to collect tax revenues and then they will complain about the governments budget at the same time after undertaking this very action which will contribute to the problem.

Got it loud and clear.
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Apparently not. The size of government is the problem.
 
upsideguy said:
Of course it won't.... it part the Con job to create smaller government by starvation: cut revenue, cry about deficits and create the atmosphere that people think the only solution is to cut expenses.

If you were really serious about budget deficits and did not want to raise taxes you would be certain to ensure everyone was at least paying the tax due: you would be expanding tax collection efforts; you would be expanding the IRS budget.
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or as some have advocated, you simplify

you can still have a progressive tax

you take away all the loopholes, tax credits, and crap

doesnt matter how the income is made....it is all taxed the same

and everyone needs to have skin in the game

no marriage penalty....no marriage credit

doesnt matter if you have zero kids or a dozen

we dont need, nor should we want a tax code like we have

According to the CCH Standard Federal Tax Reporter, as of 2013, it now takes 73,954 regular 8-1/2" x 11" sheets of paper to explain the complexity of the U.S. federal tax code!

Believe it or not, that represents an improvement from the trend that has existed since the end of World War 2, where the tool we developed to project the number of pages needed to explain the U.S. income tax code had anticipated that 77,030 pages would be needed in 2013.

You might think that our tool being "off" by 3,076 pages might depress us, especially after our tool was just 1.3% (or 956 pages) off from 2012's total of 73,608

How Many Pages Long Is the U.S. Income Tax Code in 2013? - Political Calculations - Townhall Finance Conservative Columnists and Financial Commentary - Page 1

special interest and lobbyists are what caused these issues

time to simplify!
 
when you take all the credits away, you are left just with income

have maybe 5 tiers

0-50k 5%
50,001-100k 12%
100001-300k 22%
300001-1.5 mill 27%
1.5m + 33%

all income counts

i would like to be able to not count a few types of income, but then when you add one, someone else feels left out

what i would like to leave out

social security payments
insurance proceeds from a death benefit (doesnt count as income now)

i am sure i am missing a few things....but that is how simple it should be
 
CanadaJohn said:
I agree there are a lot of reasons why an individual may be in arrears on their taxes. However, if you work for the federal government and particularly if you work for the IRS, there seems to me to be very few legitimate reasons why you would be. In addition, as your employer, the IRS has a pretty easy way of getting at your salary if you don't pay. As for it being a crime, I'd be strictly referring to anyone employed by the government who did not file a tax return - there's no excuse for that.
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I agree with all that. The only point is there are better and worse reasons for anyone to be in tax trouble, and the kind of summaries like we see here can't provide any kind of actual view of which are going on with the IRS employees, or employees of all the other agencies that are delinquent on their taxes. But IRS employees should absolutely be held to a very, very high standard in my view.
 
gdgyva said:
when you take all the credits away, you are left just with income
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I'll just say that a lot of the complexity in the IRC is caused by the fact that life, and especially business, is complex. It might sound simple, but "income" is tough to measure. And there is a lot of complexity in there as a gateway to tax avoidance for favored industries, but just as much to close loopholes for smart companies who take simple rules, twist them into something unrecognizable, and on the other side you've turned an economic gain into a huge taxable loss.

Point is, yes, we could vastly simplify the IRC and make tax compliance easier, but it's a LOT easier said than done, and can't be done without trade-offs elsewhere. It's funny - every time tax reform comes up someone will say CPAs must oppose it because it will eliminate the need for them!! OH NOOO!! I can promise, no one in tax is worried about Congress making things simple enough to threaten anyone's job as a tax professional.

What would help, and eliminate some jobs at H&R Block and the like, is for IRS to pre-prepare returns and send them out for signature. For some large majority of us, all the information on the return is reported to IRS on 1099s and 1098s, W-2s, etc. and IRS could do a perfect return quite easily and all individuals need do is, if they don't itemize, sign and send in with a check, and for those that do itemize, add charity, maybe some taxes, and send that in. Of course the tax prep lobbies have spent massive sums on lobbying and defeated those proposals.... Got to get their pound of flesh out of working people to prepare the simplest returns.
 
JasperL said:
I'll just say that a lot of the complexity in the IRC is caused by the fact that life, and especially business, is complex. It might sound simple, but "income" is tough to measure. And there is a lot of complexity in there as a gateway to tax avoidance for favored industries, but just as much to close loopholes for smart companies who take simple rules, twist them into something unrecognizable, and on the other side you've turned an economic gain into a huge taxable loss.

Point is, yes, we could vastly simplify the IRC and make tax compliance easier, but it's a LOT easier said than done, and can't be done without trade-offs elsewhere. It's funny - every time tax reform comes up someone will say CPAs must oppose it because it will eliminate the need for them!! OH NOOO!! I can promise, no one in tax is worried about Congress making things simple enough to threaten anyone's job as a tax professional.

What would help, and eliminate some jobs at H&R Block and the like, is for IRS to pre-prepare returns and send them out for signature. For some large majority of us, all the information on the return is reported to IRS on 1099s and 1098s, W-2s, etc. and IRS could do a perfect return quite easily and all individuals need do is, if they don't itemize, sign and send in with a check, and for those that do itemize, add charity, maybe some taxes, and send that in. Of course the tax prep lobbies have spent massive sums on lobbying and defeated those proposals.... Got to get their pound of flesh out of working people to prepare the simplest returns.
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i have been the lead accountant for c corps, s corps, llcs, limited partnerships, etc

now...i grant you, all in the same basic business

figuring out the income of a "company" is fairly easy (at least it has been in my experience)

corp taxes will always be more complex than than individuals return

but both sides can and should be simplified

i swear every year, the cpa firm and myself spend countless hours trying to make sure we understand the freaking rules, trying to make sure we dont have any glaring mistakes

we dont even try to explain things to the owner anymore....we just tell him how big of a check he has to write

that seems wrong in so many ways.....yes, he trusts me implicitly....and he knows we try to get everything right

but shouldnt the rules be easy and simple enough for the owner of a 100 million dollar company to at least understand why he owes over 7 figures to the irs?
 
gdgyva said:
i have been the lead accountant for c corps, s corps, llcs, limited partnerships, etc

now...i grant you, all in the same basic business

figuring out the income of a "company" is fairly easy (at least it has been in my experience)

corp taxes will always be more complex than than individuals return

but both sides can and should be simplified

i swear every year, the cpa firm and myself spend countless hours trying to make sure we understand the freaking rules, trying to make sure we dont have any glaring mistakes

we dont even try to explain things to the owner anymore....we just tell him how big of a check he has to write

that seems wrong in so many ways.....yes, he trusts me implicitly....and he knows we try to get everything right

but shouldnt the rules be easy and simple enough for the owner of a 100 million dollar company to at least understand why he owes over 7 figures to the irs?
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Like I said, simplification is possible. I just don't think that as a practical matter we will ever see a "simple" tax system. Not unless we go to something like gross receipts taxes or VATs or something like that, where the concept of taxable 'income' is no longer relevant.

And based on the proposals I've seen, simplification for some reason always eliminates deductions for the middle class and above, mostly, perhaps eliminates credits for the poor, and SURPRISE!! provides a lower top rate for the top slivers who don't care about a measly deduction for mortgage interest - they just want their $2 million salary and bonus at a lower rate and tax 'reform' gives them that!
 
American said:
You need to cool it with the false meme. That's been debunked for months. There is no doubt the scandal is real at this point.
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So why the GOP hiding behind a voice vote?
 
apdst said:
Are you serious? The IRS is obviously too corrupt to wield the power that it does.
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They need to literally fix the government's budget, or the IRS will just be understaffed and bigger assholes looking to tax and penalize everybody.
 
haymarket said:
So the forces of the right cut the ability of the government to collect tax revenues and then they will complain about the governments budget at the same time after undertaking this very action which will contribute to the problem.

Got it loud and clear.
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They're not cutting specific portions of the IRS budget. The IRS can indeed use whatever portion of their budget they need to enforce tax law.
 
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