Lone Candle
Champion of Truth
Trump administration making it easier for wealthy people to cheat on taxes. One of the simplest ways to bring in more revenue and help the deficit is to take in the taxes people actually owe. This requires enforcement and effort, but the Trump administration isn’t willing to keep doing that.
https://www.youtube.com/watch?v=jA6AKpyQ_ns
“Earlier this month, the IRS and the Department of Homeland Security (DHS) forged an agreement to share taxpayer data with federal immigration officials. According to a partially redacted memorandum of understanding, Immigration and Customs Enforcement (ICE) “will come to the IRS with the names and address[es] of taxpayers that they believe have violated federal immigration laws,” reported CNN.
The government has long encouraged undocumented immigrants who work in the United States to file their taxes. But the new agreement means that someone who pays his taxes in good faith could attract unwanted scrutiny and be at greater risk of deportation.
Between 50 percent and 75 percent of undocumented immigrants pay taxes via federal income and/or payroll taxes, the Congressional Budget Office found in 2007. Undocumented immigrants are required to pay taxes, and doing so can help in their immigration cases down the line. The IRS has long “sought to keep information submitted by undocumented immigrants confidential,” so the IRS-ICE agreement marks “a fundamental departure from decades of practice at the tax collector,” reported The New York Times.
If the agreement between ICE and the IRS discourages undocumented immigrants from paying their taxes, the U.S. could lose billions in tax revenue. In 2022, undocumented immigrants paid $96.7 billion in federal, state, and local taxes, according to the Institute on Taxation and Economic Policy (ITEP), a left-leaning economic think tank. Over one-third of those tax dollars “go toward payroll taxes dedicated to funding programs that these workers are barred from accessing,” including Social Security and Medicare, reported ITEP.
The Budget Lab, a nonpartisan policy research center at Yale University, estimates that the IRS-ICE agreement could cause federal revenues to “come in roughly $300 billion lower” over the next decade. In addition to becoming more hesitant to file their individual income taxes, undocumented immigrants might increasingly take under-the-table jobs.”
https://reason.com/2025/04/15/a-new-irs-ice-agreement-could-reduce-tax-revenue-by-300-billion-over-the-next-decade/
“The Trump administration plans to eliminate the IRS’ Direct File program, an electronic system for filing tax returns directly to the agency for free, according to two people familiar with the decision.
The program developed during Joe Biden’s presidency was credited by users with making tax filing easy, fast and economical. But Republican lawmakers and commercial tax preparation companies complained it was a waste of taxpayer money because free filing programs already exist, although they are hard to use.”
https://www.yahoo.com/finance/news/trump-administration-plans-end-irs-175500977.html
“You can add the Internal Revenue Service to the ranks of federal agencies conceding that raining taxpayer money on all and sundry to offset the negative effects of pandemic-era closures didn’t go as well as intended. Not only was a program meant to offset the cost of paying workers during lockdowns and voluntary social-distancing prone to being gamed, but the “vast majority” of claims submitted to the program show evidence of being fraudulent.”
…
“In the course of a detailed review of the Employee Retention Credit, “the IRS identified between 10% and 20% of claims fall into what the agency has determined to be the highest-risk group, which show clear signs of being erroneous claims for the pandemic-era credit,” the IRS announced June 20. “In addition to this highest risk group, the IRS analysis also estimates between 60% and 70% of the claims show an unacceptable level of risk.”
The Employee Retention Credit was offered to businesses that were shut down by government COVID-19 orders in 2020 or the first three quarters of 2021, experienced a required decline in gross receipts during that period, or qualified as a recovery startup business at the end of 2021. But it was clear early on that scammers were taking advantage of giveaways of taxpayer money, either to claim it for themselves or to pose as middlemen helping unwitting business owners file claims.
In March of 2023, the tax agency warned of “blatant attempts by promoters to con ineligible people to claim the credit.” In September of that year, it stopped processing claims amidst growing evidence that vast numbers of applications were “improper,” as the IRS delicately puts it. In March 2024, the agency announced that its Voluntary Disclosure Program had recovered $1 billion (since raised to over $2 billion) in improper payouts from participants who got to keep 20 percent of the take.
Ultimately, only “between 10% and 20% of the ERC claims show a low risk” for fraud, even by generous federal standards for throwing other people’s money at problems largely of government creation.”
…
“”The total amount of fraud across all UI [unemployment insurance] programs (including the new emergency programs) during the COVID-19 pandemic was likely between $100 billion and $135 billion—or 11% to 15% of the total UI benefits paid out during the pandemic,” the Government Accountability Office warned last September.
Earlier, the Small Business Administration’s Inspector General found more than $200 billion stolen from the Economic Injury Disaster Loan (EIDL) program and Paycheck Protection Program (PPP). “This means at least 17 percent of all COVID-19 EIDL and PPP funds were disbursed to potentially fraudulent actors,” noted the report.
With between 70 percent and 90 percent of claims for the Employee Retention Credit identified as likely scams, either the IRS is a stand-out magnet for grifters or other agencies need to return to their own investigations with a somewhat more skeptical eye.”
https://reason.com/2024/06/24/vast-majority-of-pandemic-employee-retention-credit-claims-are-likely-scams-says-irs/
IRS COMING FOR THE RICH
https://www.youtube.com/watch?v=cbEwGgtZHa8
“”if one ignores the fiction of auditing a millionaire through simply sending a letter through the mail, the odds that millionaires received a regular audit by a revenue agent (1.1%) was actually less than the audit rate of the targeted lowest income wage-earners whose audit rate was 1.27 percent!””
“The IRS didn’t audit the personal tax returns filed by former President Donald Trump during his first two years in office, despite an agency program that mandates scrutiny of every president’s tax information, a House committee said”
…
“the agency did not initiate an audit of any of the returns that Trump filed while in office until April 3, 2019. That was the same day that committee Chair Richard Neal (D-Mass.) first asked IRS Commissioner Chuck Rettig to provide Neal six years of Trump’s tax returns and any audits of those returns.
Only one such examination — that of the former president’s 2016 return — was flagged as a mandatory president audit. And three personal tax returns that Trump filed while in office for tax years 2017, 2018 and 2019 weren’t selected for scrutiny until after he left the White House.
The report reveals glaring problems for a program that is supposed to assure Americans that the president is abiding by the law, Joe Thorndike, a longtime tax historian, said.”
“The House GOP’s first bill out of the gate doesn’t address inflation or gas prices or immigration, but instead zeroes in on the Internal Revenue Service.
The bill set to be voted on Monday evening — barring a stalemate over approving the rules for the 118th Congress — would reverse much of the $80 billion in extra funding set aside for the agency by 2022’s Inflation Reduction Act.
While it has little chance of being enacted with Democrats in control of the Senate, the prominence of the issue shows just how much the IRS has become a target of Republicans even though experts say the funds in question would go toward more prosaic concerns like helping the agency chase down tax cheats and refresh its shockingly outdated technology.”
…
“The claim from McCarthy, which has been echoed by many Republicans, is that the influx of money will lead to a flood of 87,000 new IRS agents who will then harass everyday Americans. Some critics of the agency go even further and claim these new agents will be armed.
But fact-checkers have repeatedly debunked the claims, and the agency itself pushed back in a Yahoo Finance op-ed from then-IRS Commissioner Charles Rettig in August.
The viral claims are “absolutely false,” Rettig wrote at the time, adding his agency “is often perceived as an easy target for mischaracterizations,” but he promised the new money will not lead to increased audit scrutiny on households making under $400,000.
The plan is instead for much of the money to go toward wealthy tax cheats. IRS estimates of the so-called “tax gap” — the difference between what taxes are owed to the government and what is actually paid — is hundreds of billions of dollars a year.
Much of the $80 billion will be focused on taking a bite out of the gap, focusing on wealthy tax payers. The investment is projected to pay for itself and then bring in over $100 billion in increased tax revenue over the coming decade.
In addition, a May 2021 report by the Department of Treasury estimated that more IRS funding could lead to 86,852 new employees, but many of those new employees would not be agents. Many would work in other areas like information technology.
And nearly all new agents would be unarmed.”
https://www.yahoo.com/finance/news/these-3-big-pieces-of-bidens-agenda-kick-off-jan-1-200502039.html
“According to the Congressional Research Service (CRS), the Inflation Reduction Act directs the $80 billion in additional IRS funding to the following four enumerated divisions: “enforcement” ($45.7 billion), “operations support” ($25.3 billion), “business systems modernization” ($4.7 billion), and “taxpayer services” ($3.2 billion)”
…
“The Treasury Department spokesperson would have us believe that 50.01 percent of newly created positions funded by this $80 billion injection will work in the divisions receiving just 10 percent of the money.”