The following report is by Money Wise:
Get ready, ultra-wealthy Americans: President Joe Biden wants you to start paying your share.
Through the Inflation Reduction Act, Biden plans to increase funding for the IRS to help the agency catch sneaky tax evaders — especially those high-earners who love to find loopholes around the law.
A Treasury Department report from May 2021 estimates the extra money would allow the agency to hire around 87,000 new employees — which could include revenue agents and customer service and IT staff — by 2031.
Advocates believe the increased funding could raise as much as $1 trillion by forcing tax cheats to pay their dues, especially after years of budget cuts have gutted the system.
However some critics worry the increased scrutiny on taxpayers could backfire in a big way.
The $80 billion in funding spread over the next 10 years will help the IRS modernize its infrastructure, increase enforcement and replace its aging workforce (50,000 of the IRS’s 80,000 workers are expected to leave in the next five years).
The agency has reportedly been underfunded by about 20% for a decade — leading it to cut back on both staff and technology updates.
Bogged down by a processing system that’s more than half a century old and a backlog that includes millions of unprocessed paper filings, the IRS has been in need of more resources and support for a while.
The customer service department has been woefully short-staffed as well. During the 2022 filing season, the IRS received around 73 million phone calls from taxpayers — but only 10% were actually answered.
The combination of more than 21 million unprocessed paper tax returns, more than 14 million math error notices, eight-month backlogs in processing taxpayer correspondence, and extraordinary difficulty reaching the IRS by phone made this filing season particularly challenging.
National taxpayer advocate Erin M. Collins wrote in her midyear report to Congress.
On top of these issues, former IRS Commissioner Charles Rettig estimated in 2021 that the agency is losing $1 trillion in unpaid taxes each year — particularly due to evasion from the rich and big businesses. He also indicated they could be slipping through the cracks in part due to the lightly regulated cryptocurrency market, foreign source income and abuse of pass-through provisions.
Rettig has long pushed for increased funding “to bring on the fire-breathing dragons” to take cheaters to task.
Supporters argue the funding will help close the “tax gap” by helping catch more evaders.
From the total $80 billion, $45.6 billion has been allotted for increased enforcement — which will go toward hiring more enforcement agents, providing legal support and investing in “investigative technology” to determine who should or shouldn’t be audited.
But not everyone is thrilled with the news.
They’re not going to get this ‘magic money.’
If you dial up enforcement on people who are otherwise following the rules and paying what they owe, you create resentment and anger. You undermine people’s confidence in the tax system.
Brian Reardon told Bloomberg. Reardon is the president of the S Corporation Association, which represents small, privately-owned businesses that pass taxes onto their shareholders.
However, the Biden administration maintains that the increased enforcement will be focused on the ultra wealthy and large corporations, and isn’t intended for small businesses or households who earn less than $400,000 a year.
Research from the Department of Treasury indicates that the top 1% of Americans could be dodging as much as $163 billion in taxes each year.
That being said, while Eli Akhavan, a partner at Steptoe & Johnson in New York, expects audits will go up, he’s been telling his wealthy clients they “have nothing to worry about other than some headaches,” provided they’re following good advice and have their “ducks in a row.”
If there’s nothing to find, there’s nothing to find.
Akhavan says
AUTHOR COMMENTARY
In August of this year The WP detailed the move by the Biden Administration to fund the employment of these new 87K IRS agents, per the “Inflation Reduction Act;” and how the IRS was already looking to employ and train these agents to be brutalizers and bounty hunters, working in tandem with local authorities, to shakedown anyone they want audit.
We’ll see what transpires but I am inclined to believe the IRS’ tax bullies will be allowed to flex some of their muscles next year, as a hidden policy change was made that forces all cash, banking, and market apps to automatically trigger a 1099 Form for every $600 that is made, or 200 individual business transactions. Therefore if someone does not report this on their official tax filings the IRS will already having a proof of record on hand of what the taxpayer actually earned.
Most people still do not understand this is in play, and so a lot of people are going to get dinged for this. The question is whether or not the IRS will actually enforce this or keep it in their memory for later is a different story…
But as for taxing the 1%, we know this will not happen. When these evil scumbuckets talk about “taxing the rich,” what they really mean is taxing the daylights out of the highest earners that are still classified as middle class – a bracket of society that is rapidly becoming nearly extinct like the Dodo bird. The powers at be want a return to new feudal system of extreme haves and extreme have-nots.
The rich ruleth over the poor, and the borrower is servant to the lender.
Proverbs 22:7
This is why must continue to purchase what you can with cash as much as possible, and try to avoid the digital trap as best as possible, and why we MUST band together and resist the CBDCs.
[7] Who goeth a warfare any time at his own charges? who planteth a vineyard, and eateth not of the fruit thereof? or who feedeth a flock, and eateth not of the milk of the flock? [8] Say I these things as a man? or saith not the law the same also? [9] For it is written in the law of Moses, Thou shalt not muzzle the mouth of the ox that treadeth out the corn. Doth God take care for oxen? [10] Or saith he it altogether for our sakes? For our sakes, no doubt, this is written: that he that ploweth should plow in hope; and that he that thresheth in hope should be partaker of his hope. (1 Corinthians 9:7-10).
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ah yes, biden wants all the money they collect so they can hand it over to Ukraine and other nations as well. there are 2 things we need to do on this earth, die and pay taxes, the way I see it, let the other nations collect taxes for their own people and stop expecting Americans to pick up tabs, American tax dollars should stay in America period.
I agree with Jacob. Take the extra effort to get cash out of the bank every payday, don’t leave a huge amount of your money sitting for too long in these banks. Don’t be ashamed to pay in cash (or change) even if the cashier has to count all the dimes and quarters (it’ll help them flex their brains), and people in line behind you have to wait for a little bit. Awkward at first but you’ll get used to it after a while.
Also, I would strongly suggest getting rid of cellphones. To start, they’re bad for your body, aside from another well-known truth that they are tracking and surveillance devices. Another thing, it’s one more unnecessary accessory and expense that will force you to pay online instead of using cash.
Hiring 87,000 goons to go out and collect from the rich is a temporary band-aid and will not fill up the almost empty coffers of a desperate US government. The uber rich will find a way to wriggle out of paying their fair share as they always have. What seems to work well is shaking down the poor, average citizen like they always have. One good way to find new “revenue streams” is to take one or two of the US territories and make them states so they can then fleece the unsuspecting new citizens. The reason I like this idea is because of something Ruckman theorized in one of his end-time sermons that could happen that will really bring us closer to the end……the addition of 2 more states, bringing the total to 52 states……a full deck…..from the original 13. There are two sermons on YouTube referencing the book of Daniel that goes into detail about this. One is called the End of the Rope and the other is called Nebuchadnezzar’s Dream. Of course, it’s only a theory and not necessarily what will happen, but my guess would be one of the states will be Puerto Rico.
fleece (meaning tax)