Come for the politics, stay for the snark.

Despite his magical powers, I don’t think Trump is thinking this through, to be honest.

The next time the wall street journal editorial board speaks the truth will be the first.

I’d hate to be the candidate who lost to this guy.

Thanks to your bullshit, we are now under siege.

Hot air and ill-informed banter

When I decide to be condescending, you won’t have to dream up a fantasy about it.

My years-long effort to drive family and friends away has really paid off this year.

I did not have this on my fuck 2022 bingo card.

This really is a full service blog.

Yeah, with this crowd one never knows.

T R E 4 5 O N

So it was an October Surprise A Day, like an Advent calendar but for crime.

It’s the corruption, stupid.

Motto for the House: Flip 5 and lose none.

It may be funny to you motherfucker, but it’s not funny to me.

They traffic in fear. it is their only currency. if we are fearful, they are winning.

No one could have predicted…

Pessimism assures that nothing of any importance will change.

If senate republicans had any shame, they’d die of it.

Infrastructure week. at last.

Our job is not to persuade republicans but to defeat them.

Impressively dumb. Congratulations.

Their freedom requires your slavery.

They are lying in pursuit of an agenda.

You are here: Home / Economics / C.R.E.A.M. / Open Thread: Beefing Up the IRS

Open Thread: Beefing Up the IRS

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Can’t fix your tax problems if there’s nobody to answer the phones or process the returns:

… Fred Goldberg, who headed the agency under then-President George H. W. Bush, joined Charles Rossotti and John Koskinen, who led the IRS under the Clinton and Obama administrations, respectively, signed onto a statement released Thursday backing the reconciliation spending bill effort.

In the statement, the former commissioners bemoaned what they described as “the status quo” at the IRS, saying the agency “has shrunk to 1970s levels with technological infrastructure that is decades out-of-date and an audit rate that has dropped by 50 percent.”

The commissioners argued Democratic efforts to invest $80 billion in the agency to help beef it up and bolster enforcement of tax laws would lead to “vastly improved services for taxpayers.”…

“The sustained, multi-year funding contained in the reconciliation package is critical to help the agency rebuild. That will mean vastly improved services for taxpayers, who will be able to interact with a modernized IRS in a digital way, whose questions will be answered and issues resolved promptly and fairly, and who will find it simpler to get access to the benefits and credits to which they are entitled,” the commissioners wrote.

“It will also mean the capacity to enforce the tax laws against sophisticated taxpayers who today evade their tax obligations freely, because they know that the IRS lacks the tools it needs to pursue them,” they said. “To be sure, the vast majority of workers already pay what they owe, which is why the Administration has been clear that audit rates wouldn’t increase for families making under $400,000 annually.”

Reader Interactions

96Comments

  4. 4.

    The Moar You Know

    Oh, they are auditing.  Waiters and store clerks.  Anyone making under 50k/year.

    I’ll only be happy about this announcement if they start actually going after big earners.  One can hope.

  5. 5.

    sab

    As a tax preparer it would be really nice if when we say you can’t do this. They will catch you and penalties and interest will be costly. That was true when I started. Now taxpeyers just roll their eyes and get mad when we do it correctly.

  6. 6.

    bbleh

    I just hope the Dems get out in front of this fast, and SELL the bejeezus out of it, instead of waiting for it to dawn on The American People why it is a Good and Right thing to do.

    “Increasing funding for the IRS” plays right into the Republican myth of “tax and spend” Democrats, and they’re going to milk that for all it’s worth.  Dems need to go hard on offense — who’s complaining? who’s not paying their FAIR SHARE? — or they’ll get run over by it.

  7. 7.

    raven

    @sab: We met with ours last week after filing an extension because our stuff is really complex! We’re going to deduct most of the “repair” work on our rental and I hope that goes well. We also are in this crazy movie investment that we hope pans out!

  8. 8.

    NotMax

    Open Thread? Grrr.

    Some jerk came by, opened the door of my roadside mailbox and twisted it so now it won’t close. Heading out before trekking into town to wrangle it into usefulness again with a pair of pliers and a healthy application of elbow grease.

    Not directly casting blame without evidence but these kind of annoyances became more frequent when a school bus stop was put in place on the other side of the driveway from where the mailbox stands.

  11. 11.

    Old School

    It’s been 8 months and nothing is getting done but ik bb

    Can anyone translate “ik bb” for me?

  12. 12.

    Hilbertsubspace

    @The Moar You Know:  I know three people who were audited (long ago).  All three were teachers, and the audits were a waste of time.  So, I hope they improve their ROI by targeting the upper class.  Plenty of dumb money out there.

  14. 14.

    Martin

    @The Moar You Know: One of the problems hasn’t really been addressed – a congressional mandate that the IRS address noncompliance with the EITC. So what staff they do have is required, by Congress, to be concentrated on EITC compliance. Mitch of course knows this.

    So given that mandate, the IRS really should have a dual staffing model – a mandatory staffing to address the EITC mandate, and a second staffing to go more broadly after other noncompliance. I would also argue that the tax codes ability to create extremely high wealth individuals also make enforcing compliance by those individuals impossible because they are able to outstaff the IRS.

  15. 15.

    Hungry Joe

    GOPers see taxation (of the wealthy, at least) as theft, which means that underfunding the IRS is Right and Just. It also slashes revenue, and that invariably calls for regrettable cuts in social programs. So … win/win.

  16. 16.

    Martin

    I’ll add to my comment above, that the IRS has maintained a fairly constant level of tax examiners, which are the lower level auditors that focus on the routine filings, but the number of revenue agents is half what it was a decade ago. The revenue agents are the ones that go after the big earners, that know how to look at other sources of income, etc. There’s 8,000 of them, and to audit someone like Jeff Bezos or Elon Musk would require dozens of them.

  17. 17.

    HumboldtBlue

    Olivia Newton John has died. And a former Federal prosecutor is representing Trump in talks with DOJ.

  18. 18.

    Elizabelle

    Beefing up the IRS, you say?

    I think that is why the FTF NY Times has this up as top item on their website.  Their new editor, Joe Kahn, is stinking hot garbage.  I wonder how former NYT ombudsman Margaret Sullivan feels about him now?

    It’s not clouds, it’s Concerns.

    Analysis:  A String of Good News for Biden, but Concerns Remain

    — In recent weeks, major legislation like the climate, health and tax bill cruised to passage, and some economic indicators pointed in the right direction.

    — But whether the victories will prove to be a turning point for President Biden, one of the most unpopular U.S. leaders in modern history, remains to be seen.

    That’s at the top of the NY Times website.  Right now.

    Fuck the Fucking NY Times.

    Oh?  And the author of this “anal”ysis?  It is Peter Baker.  Enough said.

    I mean, look at that.  “Cruised” to passage?  Not hardly.  It was a lot of hard work.  And some indicators pointed?  For any reason whatsoever?

  20. 20.

    Martin

    @Hilbertsubspace: There’s two kinds of audits:

    Those may have been TCMP audits. Tax Compliance Measurement Program is kind of like building a survey model. They pick out a representative cross-section of taxpayers and audit all of them, with the expectation that all of them are compliant. It’s the way that the IRS measure overall compliance. It’s a waste of time to the individual taxpayer, but not to taxpayers overall because it’s designed to help the IRS understand how widespread non-compliance is, where that non-compliance tends to be, etc. and to be able to tell Congress ‘hey, leave these filers alone – almost none of them ever cheat’.

  21. 21.

    Matt McIrvin

    That poll is strange. Republicans have more positive views of nearly ALL government agencies than Democrats do? Aren’t they the “anti-government” party, bent on making you hate public employees?

  22. 22.

    The Pale Scot

    @raven:

    We also are in this crazy movie investment that we hope pans out!

    Free DVDs for the Jackals….. right?

  24. 24.

    Ken

    @Hilbertsubspace: I was audited once, because my charitable donations had a spike one year (church building program). I showed up with copies of all the letters from the charities and of all my checks, everything was there and matched my return, and there was no problem.

    I chiefly remember it because in the waiting room, I was sitting there with my neatly-organized files, and there were two other people with the proverbial shoebox of random scraps of paper.

  25. 25.

    Anne Laurie

    @Old School: Can anyone translate “ik bb” for me?

    From my limited search: I know, bye bye

    As in:  Yeah, you’re gonna argue, I’m not gonna listen

    Tweeter in question is highly libertarian, so…

  26. 26.

    Ken

    @Martin: Yeah, the correct answer to “why does the IRS need to hire 87,000 new staffers” is “because multi-billionaires are willing to hire 87,001 to get out of paying what they should”.

  29. 29.

    sab

    @Hilbertsubspace: A lot of “auditing” these days is just notices when the return doesn’t agree with the reported income ( 1099s etc.) Easier on everyome, and a lot can be cleared up via correspondence.

    I got actually audited once when my small business was doing badly.  I am an onsessive record keeper, so they ended up giving me a $300 refund

  33. 33.

    Geminid

    @Martin: The IRS could put a few hundred auditors to good use just monitoring the Q45 tax credit program. This sizable and expanding tax credit goes to companies for carbon sequestration, and right now enforcement is effectively an honor system.

  34. 34.

    jonas

    If anyone I know starts bitching and moaning about the added IRS enforcement, I’ll just raise an eyebrow and go “Wow — I didn’t know the [insert name of whatever small business they’re in] business was doing so well these days you have to stash the extra money in Cayman Islands shell corporations and Damian Hurst paintings. Cheers, mate!”

  35. 35.

    raven

    @The Pale Scot: It way more complex than that! The company we invested in did a movie called “The Fallout” about a school shooting and it is actually really well done.

  39. 39.

    MattF

    It’s been more than a decade, at least, since doing my taxes was more complicated than copying numbers from forms into TurboTax. Used to have to figure out the basis for stocks and bonds, but that was long ago. Still have several boxes in my closet with (paper!) financial statements going back many years.

  40. 40.

    Original Lee

    I’ll be happy if getting their staffing levels up means an error in our taxpayer info records gets straightened out before e-filing is mandatory. Somewhere in the depths of time, a birthdate was corrupted. It’s not at the Social Security Administration end. It’s definitely at the IRS end. The error means we can’t e-file. We occasionally have problems because our returns are huge piles of paper; for instance, one year, they lost our check and we had to pay a penalty for not paying on time. Every year, after we file on paper and our check is cashed, we try to get the error fixed, and every year, nothing happens. It’s terrible.

  41. 41.

    Geminid

    @jonas: There was a new law passed in the 2020 “lame duck” session which may alter the tax-dodging capability of shell corporations. The Corporate Transparency Act was attached to the National Defense Authorization Act that passed over trump’s veto. The CTA required new incorporations to disclose the “beneficial”, or actual ownership of the corporation, and gave existing corporations two years to comply. That period will end early this coming January.

    Perhaps because there was so much else going on at the time, the CTA got little notice, but a Forbes Magazine reporter said it was the most important corporate reform legislation in decades. New York York Congresswoman Caroline Maloney was said to be it’s primary sponsor. I suspect that if it had been sponsored by a “star” like Elizabeth Warren or Katie Porter we would have heard a lot more about the CTA.

  43. 43.

    Alison Rose 💙🌻💛

    Third murderer (William Bryan) of Ahmaud Arbery got 35 years for federal hate crimes. The other two got additional life sentences. One source said Bryan is 52, so a 35 year sentence isn’t much different than life, I suppose.

    Good.

  44. 44.

    sab

    @Geminid: Aren’t you a busy landscaper.  And I don’t mean that in derision.

    All sorts of highly paid financial reporters, and I get much better tips on Balloon Juice from interested people following their curiosity, and avoiding rabbit holes.

    Also too my RWNJ who I no lomger am on speaking terms with because politics has always said that carried interest wasn’t that big a deal because if we plug that loophole they can easily invent another. I belive him. So a good tradeoff for Sinema’s vote.

  46. 46.

    sab

    @Fair Economist: FTNYT is just being snobby in their obit because Country music accepted her. FTFNYT forgets that Country is not just an American category. Brits also like it when sung by Brits.

  48. 48.

    Geminid

    @HumboldtBlue: Olivia Newton-John’s leather-jacketed character in Grease! looked like some of the publicity photos of singer Leslie Gore in the early 1960’s. Gore’s outlaw image was somewhat ironic; after Quincy Jones produced Gore’s hit “It’s My Party,” when she was 16, Gore went on to attend and graduate from Sarah Lawrence College.

    Leslie Gore was active in music until she died of lung cancer in February, 2015 at age 68. She had hoped to marry her woman partner that summer.

  49. 49.

    trollhattan

    @sab: Stuff I didn’t know before today:

    Newton-John was born in Cambridge, UK on 26 September 1948.

    Her father had been a British spy during World War Two. Her mother was the daughter of the German Nobel laureate, Max Born, and had fled with her family when the Nazis came to power in 1933.

    The family moved to Australia in 1954, where she was raised.

    Parents were fascinating, plus IDK she was born in UK before emigrating to Australia.

  50. 50.

    Villago Delenda Est

    The “super-affluent people” are fortunate that they’re just going to have to pay the taxes they should, instead of facing what FDR protected them from back during the Great Depression.

  52. 52.

    sab

    @trollhattan: I always liked her and her music, but I like country crossover.

    I admit that everything about the musical Grease offends me, except that I like some of the songs.

    Asshole boy and high school mean girls corrupting a sweet young girl who just wants to have friends. And we are supposed to celebrate that.

  54. 54.

    Kevin

    As a CPA I say it’s about time. We are basically de facto IRS agents at this point. Just without the power to actually fix things. it’s incredibly frustrating to not have the ability to actually do our jobs correctly since it takes months to get an answer from them. Not to mention the IRS is one agency that actually has a high return in investment. A dollar invested brings in like $3-4 in revenue. Amazing the Republicans who are supposedly business savvy don’t recognize this.

  55. 55.

    Mike in NC

    Was a contractor at the local General Electric facility for four years and was disgusted that GE paid no federal income tax.

  57. 57.

    Dan B

    @Omnes Omnibus: It’s the relentless repetition that breaks through.  People listening to Biden already know what the boll does, or at least 90% do.  After a week of endless repetition and Sunday talk show hammering two points, and no more PLEASE!, one of the points will make it into the MSM and social media.  After another month of circulation and repetition on social and other media a few low information voters will pick it up in the Kardasian / celebrity / goofy tic toks static.  The message will be fighting an uphill battle against the tsunami of media purchased by Think Tanks funded by billionaires (thanks Powell Memo – not..).  By then it’s almost October and kids back in school so the middle class will have a few minutes to check their Facebook and Twitter accounts and ask their friends and families why they believe this bill won’t raise their taxes.

  58. 58.

    UncleEbeneezer

    Really bummed to see that Olivia Newton John has died at 73 after a long battle with breast cancer.  She was such an icon in my adolescent boyhood life and seemed like a really decent person.  I still listen to the Xanadu soundtrack all the time.  F*ck cancer :(

  65. 65.

    Geminid

    @sab: The CTA and NDAA votes went down at the end of December, 2020. That was a very slack time for me, so I could pay attention. Even now I work only part time, but I get to blame the heat for that!

    “Lame duck” sessions can be interesting. Congress ended the “Don’t Ask, Don’t Tell” policy in the 2010 lame duck session. That allowed gay people to openly serve in the military, and I think they amended the military’s Uniform Code of Justice to do this. The coming lame duck session might have some surprises too.

  66. 66.

    Baud

    @trollhattan:

    Her mother was the daughter of the German Nobel laureate, Max Born, and had fled with her family when the Nazis came to power in 1933.

     

    (Let’s Get) Physical was initially written as an homage to her grandfather.

  67. 67.

    Kelly

    I can’t find the link just now but I believe the bill includes funding for an IRS online file liberating us from Damned TurboTax

  69. 69.

    Geminid

    @Kevin: I think Republicans know this but are beholden to tax cheats small and huge.

    Anyway, it’s good to hear the opinion of someone with real experience in this area!

  70. 70.

    jonas

    @Geminid: Good to know. I think countries like Switzerland now also have to disclose information on American account holders to the IRS, which shuts off yet another popular avenue of tax dodging.

  71. 71.

    Dan B

    @Omnes Omnibus: It’s the relentless repetition that breaks through.  People listening to Biden already know what the boll does, or at least 90% do.  After a week of endless repetition and Sunday talk show hammering two points, and no more PLEASE!, one of the points will make it into the MSM and social media.  After another month of circulation and repetition on social and other media a few low information voters will pick it up in the Kardasian / celebrity / goofy tic toks static.  The message will be fighting an uphill battle against the tsunami of media purchased by Think Tanks funded by billionaires (thanks Powell Memo – not..).  By then it’s almost October and kids back in school so the middle class will have a few minutes to check their Facebook and Twitter accounts and ask their friends and families why they believe this bill won’t raise their taxes.

  72. 72.

    trollhattan

    @Baud: Good thing he wasn’t an economist, because “Let’s Get Fiscal” does not have “hit” written all over it.

  75. 75.

    sab

    @UncleEbeneezer: I just had a niece die of breast cancer in her thirties, leaving two very young children who will barely remember their mom. I am sorry for ONJ but she certainly made the best of the additional time. She lived it to the fullest, and knew she was lucky to have it.

  77. 77.

    Dan B

    @prostratedragon: Gay line dance.  It looks like the big Country gay bar in Seattle in the 80’s and 90’s but outside.  Didn’t sign up so now I’m curious about comments.

  78. 78.

    Gvg

    @Hilbertsubspace: maybe you know more teachers than rich people so your sample is skewed. Also maybe cheats don’t complain or admit it but honest people are free to tell everyone they got audited unfairly.

    I knew someone who was audited. He was smirking about beating the audits. I didn’t have enough evidence or background info to turn him in but I am sure he was. 35 years ago at least.

    As a college financial aid officer I also ran into a student whose parents had cheated and got caught so the student had to try and get his own taxes fixed. He had trusted his parents and let them file his taxes.

    There are a lot fewer audits than there used to be.

  80. 80.

    Feathers

    One thing really needed is the auto filing system the rest of the world has that come pre filled out with all the data the IRS has for you.

    Sad about Olivia Newton John. My first records ever were ones I’d asked for Christmas – the greatest hits records for Olivia Newton-John and Elton John. I was a total 70s AM radio kid. The song that popped into my head when I heard the news was “Please Mister Please.” I don’t know that I would have remembered that song existed yesterday.

    Also, ONJ as a judge on Drag Race in 2015. Talk about someone with many, many lives as an entertainer. https://youtu.be/OzTkqcT63gg

  82. 82.

    Another Scott

    @Original Lee: I’m sorry you’re going through that.  My wife is a twin and her credit report got mingled with her twin’s a few years ago.  They just got that straightened out – they hope!

    It sounds like you’ve been more than patient.  Can you contact your Congresscritter and see if they can help with the IRS?  I think you’re right to be concerned that you need to get it fixed before paper returns are verboten, plus you shouldn’t have to deal with that stress for so long.

    Good luck!

    Cheers,
    Scott.

  83. 83.

    Uncle Cosmo

    @trollhattan: ​Someone who IIRC was a philosophy type did a parody called “Let’s Get Metaphysical.” ** Favorite line:

    Let me hear just one hand clap…

    ** No relation AFAICT to the David Gilmour instrumental of the same name.

  84. 84.

    DrDaveChemist

    @Kelly:

    About damn time! I have always resisted e-filing because I don’t understand why a privately owned company has to profit from my civic obligation to pay taxes. Especially since the IRS theoretically should already know all of my wages, investment income, et cetera, since my employer and my financial institutions are required to report that information. I refuse to e-file until there’s a free IRS option that works for my circumstances. I’m just glad that I’m not counting on being able to spend the refund that still hasn’t been processed.

  85. 85.

    Brachiator

    It is unclear whether the IRS will be able to use any of this funding for present operations. The pandemic and increased responsibility for handling the rebates and other programs, and deliberate attempts by the GOP to hamper IRS functions, has severely impacted many operations. For example, the IRS has lost control of paper return processing.

    The report cites that the IRS had a backlog of 21.3 million unprocessed paper tax returns at the end of May 2022, an increase of 1.3 million from May 2021. These delays impact taxpayer refunds on paper filed returns, of which receipt is generally delayed 6-10 months or more after filing.

    I know people who filed paper returns who cannot get the IRS to even verify that their returns have been received even though their paper state returns were successfully processed weeks ago and refunds received.

    The IRS has not correctly updated tax year 2020 information for an unspecified number of taxpayers.

    These breakdowns will affect their ability to increase enforcement and do more audits.

    This is one of the major under reported stories of the year.

  86. 86.

    DrDaveChemist

    @Another Scott:

    My family has an amusing/terrifying story of identity confusion due to social security numbers being assigned serially. My twin sons were born on the same date as another set of twins at the same hospital. Their serial numbers are apparently sequential (my two definitely are), so when one of the other set of twins mis-remembered his SSN, he ended up using my son’s and nobody flagged it because the birthdate was correct, even though the names didn’t match.

    My son only found out when he was denied a credit card. When the credit agency claimed he had credit and student loans issued to “other kid’s name” my son realized he knew who it was, contacted “other kid” who eventually straightened it all out. (As a teacher where “other kid”’ went to school, I can verify that “other kid” is not very bright but probably didn’t have any nefarious purposes, especially since his family has a lot more money than ours.)

    Is it really too much to ask for competence in our financial and government institutions (rhetorical  question)?

  87. 87.

    bbleh

    @Omnes Omnibus: It is, and he’s not the only one, but it has to continue for a while, and it needs to be offense and not defense.  And it’s on top of all the OTHER things they’ve got done and need to sell, but I guess that’s a (comparatively minor) downside of getting a lot of things done at once.

  91. 91.

    Brachiator

    @DrDaveChemist:

    I refuse to e-file until there’s a free IRS option that works for my circumstances.

    Yeah, there are limitations on the type of tax returns that qualify for free efile. Unfortunately some of the private companies involved in the free efile program are ending their participation and the IRS cannot pick up the slack.

    The IRS reprocessed some tax returns during that time when the rules about taxable unemployment compensation changed. The returns were processed correctly but some related records did not get updated properly and no one at the IRS has reported on the extent of the problem.

    Bottom line. The IRS could handle free efile, but it would take some serious funding and increased staffing.

    Also, some GOP Congress critters and past administration officials are on record saying that they want IRS operations to be painful because when people hate the IRS it makes it easier for the GOP to push tax cuts.

  92. 92.

    Soprano2

    When I was a junior in high school we put on a variety show. The teacher wanted to do the ending routine from “Grease”; I was going to get to do Sandy, but she couldn’t find a guy to do Danny so we didn’t do it. I kind of looked like her in high school, I had that haircut and I’m blonde. I was a lot skinnier back then.

  93. 93.

    Repatriated

    @Baud:

    “Let me hear your spreadsheets talk…”

    Yeah, not as good.

    Let’s get VisiCalc, VisiCalc…”

  94. 94.

    Soprano2

    @Alison Rose 💙🌻💛: Fuck them. I hope they all rot and die in state prison. If they didn’t want to do the time they shouldn’t have done the crime. Funny how they’re so remorseful now, since the coverup was unsuccessful.

  95. 95.

    ObedMarsh

    Can’t fix your tax problems if there’s nobody to answer the phones….

    Hey – I answer the phone.  Call after call after call.

  96. 96.

    Another Scott

    @DrDaveChemist: My personal horror story is when my wages were garnished to pay court-ordered child support.  I don’t have any kids and never did.

    Turns out, the guy who was ordered to pay has a SSAN that differs from mine in the last digit.  We have vastly different names, addresses, ages, but are in the same very large employment system.  The copy of the court order was a bad Xerox and the digit in question was smudged so the guy or gal doing the data entry picked the wrong person…

    Yeah, checking names and other stuff carefully and not just relying on a single 9 digit number would be really, really good.

    ;-)

    (It only took about 6 months to get it resolved in my case…)

    Cheers,
    Scott.

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