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I hate this article. It’s an important issue - the IRS not having the resources to review complex tax returns - but it’s hard to read past the authors efforts t

I hate this article. It’s an important issue - the IRS not having the resources to review complex tax returns - but it’s hard to read past the authors efforts to build outrage around unfairness and actually understand it. He claims throughout the article that the IRS focuses disproportionately on poor families over the wealthy, but the first f$&@ing sentence says that the IRS audits the working poor at the same rate as the wealthy. You can argue that that’s not good policy, but it’s literally the definition of proportionate. The sub-head and the first sentence literally say opposite things. I’m so frustrated with the article because I feel like the focus on “disproportionate enforcement” (which the article itself says isn’t happening) distracts from the very real and outrageous problem. Sorry for the rant

jjeaff 7y ago
If the purpose of audits are to recover tax revenues, then auditing the poor at the same rate as the wealthy is very disproportionate. If the purpose of audits is merely to find and punish tax cheats, then auditing everyone at the same rate makes sense I suppose. Though I suspect certain higher income levels are more prone to cheating.
- notacoward 7y ago
  If the purpose of audits is to find and punish cheating, then auditing in proportion to number of exemptions/deductions would make the most sense. Sure, audit people claiming EITC more, but also audit people claiming lots of exemptions for money transferred to/from trusts or Caymans corporations, deductions for depreciation and business expenses, and every other special provision in the bookshelf-long tax code. Sure, a lot of these provisions have legitimate reasons for existing and are genuinely necessary for some people (like EITC), but each one also has some potential for abuse and when the tax code has thousands of them it becomes like a recipe book for those looking to evade.
timwis 7y ago
That's not quite right. Click the link in the first sentence you're referring to for context: > Americans who receive the earned income tax credit, one of the country’s largest anti-poverty programs, are audited at a higher rate than all but the richest taxpayers. The new data shows that the trend has only grown stronger.
- papreclip 7y ago
  You're both right. The EITC only requires you to have earned $1 in income. When he quotes the statistic about the "working poor", they are probably counting people who work full time EITC often results in the individual paying negative taxes. I know this was the case for me one year that I mostly spent unemployed. It's not the craziest thing in the world to pay extra attention when you're handing out checks, if for no other reason than to keep the program honest and protect its existence

jjeaff 7y ago

If the purpose of audits are to recover tax revenues, then auditing the poor at the same rate as the wealthy is very disproportionate. If the purpose of audits is merely to find and punish tax cheats, then auditing everyone at the same rate makes sense I suppose. Though I suspect certain higher income levels are more prone to cheating.

notacoward 7y ago
If the purpose of audits is to find and punish cheating, then auditing in proportion to number of exemptions/deductions would make the most sense. Sure, audit people claiming EITC more, but also audit people claiming lots of exemptions for money transferred to/from trusts or Caymans corporations, deductions for depreciation and business expenses, and every other special provision in the bookshelf-long tax code. Sure, a lot of these provisions have legitimate reasons for existing and are genuinely necessary for some people (like EITC), but each one also has some potential for abuse and when the tax code has thousands of them it becomes like a recipe book for those looking to evade.

timwis 7y ago

That's not quite right. Click the link in the first sentence you're referring to for context: > Americans who receive the earned income tax credit, one of the country’s largest anti-poverty programs, are audited at a higher rate than all but the richest taxpayers. The new data shows that the trend has only grown stronger.

papreclip 7y ago
You're both right. The EITC only requires you to have earned $1 in income. When he quotes the statistic about the "working poor", they are probably counting people who work full time EITC often results in the individual paying negative taxes. I know this was the case for me one year that I mostly spent unemployed. It's not the craziest thing in the world to pay extra attention when you're handing out checks, if for no other reason than to keep the program honest and protect its existence