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> For now, the IRS says, while it agrees auditing more wealthy taxpayers would be a good idea, without adequate funding there’s nothing it can do. Why not pay
by chimi 7y ago
> For now, the IRS says, while it agrees auditing more wealthy taxpayers would be a good idea, without adequate funding there’s nothing it can do.
Why not pay out a portion of the tax recovered from audits as a bonus. The IRS auditor gets 1-10% of the tax they recover for the people of the USA.
It'd work like the commissions the big accounting firms receive of the amount of tax they save for their clients.
I bet there'd be a benefit in retaining those really smart auditors who could pass all the tests as well. I can't help but imagine some of those auditors leave the IRS and go straight to those aforementioned accounting firms. Farm team style like the Senators and Representatives do to lobbyists.
- mimikatz 7y agoIncentives matter and that is a really dangerous incentive.
- chimi 7y agoThe perverse incentive is rewarding an organization for enabling the defrauding of the American people. My bonus scheme will only balance that.
- sokoloff 7y agoI literally had to read your comment twice, because you're creating an incentive for the agents of the IRS to strongarm the public because it directly lines their pocket. You're also creating an incentive to bribe IRS agents, because why take 1-10% if a fraudulent taxpayer would readily offer you at least twice that amount... The reason I had to read it twice is I thought you were suggesting the "organization" in question was the IRS itself.
- pintxo 7y agoWhy is that? I am with you, that incentives need to be very carefully crafted to prevent negative side effects. But what could the negativ effect be here?
- jlawson 7y agoLet's try it from another point of view: We'll pay cops per criminal they get convicted, or per ticket they write. Can you imagine some negative side-effects?
- chimi 7y agoThey already do that. It's called civil asset forfeiture. https://en.wikipedia.org/wiki/Civil_forfeiture_in_the_United_States https://en.wikipedia.org/wiki/Civil_forfeiture_in_the_United...
- jlawson 7y agoGood point! And look how fucked up that is.
- pintxo 7y agoSure, but I hope we can agree that the power of cops is quite different from the power an IRS reviewer has over you. And while a lot of tickets are issued on a his says, she says basis, this is not how a tax audit works, is it? I'd say its vastly easier to defend oneself against a paper trial based acqusation of tax fraud than again a witness based police acquisation.
- jlawson 7y agoTax audits can largely be a matter of interpretation and what kinds of explanations the authorities are prepared to accept. Not fundamentally different from a traffic ticket. And IRS reviewer can send the cops after you. It's not that different.
- josh_fyi 7y agoThe IRS has tremendous power. They can find small discrepancies (everyone has some) and tell you the penalty is 5 years in prison, or offer you the chance to pay $50K instead as a penalty, or you can pay $150K to lawyers to fight it and maybe lose. Who wouldn't just send the $50K?