Tag Archives: taxes

IRS Misbehavior

Posted on by
Reply

The IRS wants to be the one to figure the taxes owed by us average Americans, and the IRS wants to do the figuring based on the data the IRS claims to have collected on each of us average Americans.

The Inflation Reduction Act, that travesty that too many Republicans actually voted for and that is a source of the present inflationary environment (among a number of economic problems inflicted by the IRA), authorized the IRS to explore the concept of a mechanism that would have the IRS figure our taxes for us.

Specifically, the legislation required a study by an independent third party examining the idea’s feasibility, as well as a report by the IRS for Congress assessing the study, the cost of such a system, and taxpayer opinions based on surveys.

In no way did the IRA authorize the IRS to go ahead and build such a facility. IRS Commissioner Daniel Werfel assured the Senate Finance Committee and the House Ways and Means Committee that the IRS that he runs, in fact, was not building such a facility.

No decision has been made on moving forward with direct file solution[.]

And

I don’t know yet whether the direct file solution is the right additional menu item to put in place so that taxpayers that prefer to engage that way can do it. What I’d like to do is have the report issued. And then engage in a conversation with the right set of stakeholders and then figure out what the go-forward is.

Aside: No one on the House committee—to whom that last quote was directed—asked Werfel who he thought were the right stakeholders.

It turns out, though, that the IRS has gone ahead and developed precisely that “We’ll Figure Your Taxes For You; Don’t You Worry Your Little Heads About It” facility.

[T]he IRS had been quietly building an actual prototype of direct file before submitting the report to Congress, as The Washington Post first reported in May. The IRS announced its final report one day after the Post‘s revelation. The IRS system will reportedly be available through a pilot program for a small group of taxpayers by January, when the 2024 filing season begins.

The IRS offered this in response to queries:

[T]he IRS told Fox News Digital that the prototype was built only to help with survey data to gauge the opinions of taxpayers on a direct file system.

Sure. Maybe folks might be interested in some beachfront property north of Santa Fe, too.

Senate Finance Committee Ranking Member Mike Crapo (R, ID) had this:

This suggests a pre-determined outcome and flies in the face of previous commitments Commissioner Werfel made to publicly consult Congress on a potential free-file solution, and for the IRS to not act without explicit legal authority[.]

What he said. Congress needs to drastically reduce IRS funding to little more than its payroll needs (which do not include the $80 billion (only somewhat reduced by the debt limit deal) appropriated for all those extraneous new IRS “auditor” hires). Since the IRS—with Werfel’s acquiescence, if not active permission—is going to misuse the funds it’s allocated, those funds need to be cut off.

Also: Did Werfel lie to Congress when he said no such a thing was in progress? Or was he merely incompetently oblivious to what was going on in his IRS?

That’s Easy

Posted on by
Reply

Progressive-Democratic Party politicians claim they want to prevent a future [debt ceiling] standoff by trying to defuse the borrowing limit as a weapon.

Congressman Brendan Boyle (D, PA), the top Democrat on the House Budget Committee, said there is an increasing number of Democrats who want to fundamentally change the debt-ceiling process, with many colleagues recognizing it is “just insanity to keep doing this over and over and over again.”

Boyle also said this, as though it were a bad thing:

Because we have been fixated on this issue for months and months, we are dramatically behind on all the rest of the legislative work that Congress has to get done.

Actually, the only things Congress has to get done, and it would take very little time were Party to stop being obstructionist, are to pass a budget and then lower personal and corporate income tax rates across the board and pass the dozen separate appropriations bills that give effect to that budget.

As I wrote during an earlier debt ceiling fight,

Getting this profligacy [in spending] under control—eliminating that profligacy—is the only way to get rid of budget deficits, and the elimination of those deficits—not their reduction, but their elimination—is the only way to avoid having to repeatedly increase the amount of our borrowing, the only way to eliminate the “need” to repeatedly raise the debt ceiling….

Eliminating debt ceiling fights should be perfectly straightforward to do. However, those politicians are congenitally incapable of reducing spending. They still can’t even say the words “cut spending.”

Hype that Deadline

Posted on by
Reply

Even The Wall Street Journal is in on the artificial…excitement…act. Congress has just a few days to pass a bill before June 5 deadline goes the subheadline.

It’s not much of a deadline, with revenue flowing in under existing tax laws that’s more than sufficient to pay as scheduled the principal and interest on our nation’s debt, and then the scheduled payments for our soldiers and veterans, and then the scheduled payments for Social Security and Medicare along with the scheduled transfers to the States for Medicaid, and then the scheduled payments for HHS, then DoT (for good or ill), then DoEd (for good or ill), then….

You get the idea.

There are only a couple of things of note should a debt ceiling deal not be enacted by 5 June (or whatever becomes Yellen’s deadline du jour). One is that much of the Federal government would have to shut down. That amounts to a big so what.

The other is that a number of Federal government contracts with private businesses would have their payments HIAed, to the detriment of those businesses. The failure to pay on time also would strongly negatively affect our economy and to a large extent our reputation around the world.

That last is a consideration worth taking very seriously, but not at the expense of enacting a debt ceiling deal, any deal. Republicans and Conservatives in the House need to stand firm. The present deal isn’t all that, but, to coin a phrase, think of the (Progressive-Democratic Party’s) alternative.

The deal also shouldn’t be stand-alone.

Some conservatives in the House and Senate have said they would oppose the deal because it doesn’t go far enough to limit federal spending….

One way to show they’re serious about that is via the as yet undeveloped Federal budget for the next fiscal year. Beginning Thursday (assuming today’s vote is up rather than down), the House—which is to say, the Republican caucus, since they’ll get no cooperation from the Never-and-Nothing-Republican Progressive-Democratic Party caucus—needs to begin work on that next Federal budget, a budget that codifies reduced Federal spending, reduced Federal tax rates, and reformed Social Security, Medicare, and Medicaid transfer payments, and have that budget passed and ready to send to the Senate the day after that body votes on the debt ceiling bill.

And then the House—the Republican caucus—needs to get to work on the dozen separate appropriations bills that are due by this fall.

There’s no need to wait on a President’s budget proposal (what President Joe Biden (D) tossed over the House’s transom this winter is not one that can be taken seriously) or to put up with Progressive-Democrat obstructionism and knee-jerk “No.”

Press ahead.

A Tax Picture

Posted on by
Reply

This is for the benefit of those who demand the Evil Rich “pay their fair share.” The rest of us—us ordinary Americans—already know the facts of the matter.

As noted at the bottom of the graph, the data are from the Congressional Joint Committee on Taxation, which is comprised of nonpartisan tax specialists. WSJ staff did the analysis.

Those Evil Rich, boy, they’re only paying 39% of the total income taxes remitted, nearly two-and-a-half times their proportion of income earned across the nation, while the working poor are paying a whopping 6%, or just under a third of their proportion of income earned.

No wonder no Progressive-Democratic Party politician, or anyone on the Left, is willing to say what “fair share” is.

Taxing the Middle Class and Poor

Posted on by
Reply

Arizona’s Progressive-Democrat Governor Katie Hobbs has vetoed a bill that would have barred cities and municipalities from taxing food purchases. Hobbs’ rationalization went like this:

The bill, originally unveiled as a way to mitigate inflation, does not take effect for more than two years. What’s more, it does nothing for the more than 800,000 Arizonans who use SNAP and WIC benefits for their groceries, as these constituents are already exempt from the tax.

Hobbs’ first beef might seem like a reasonable objection, and one easily corrected. However, it’s reasonable, also, to give those cities and municipalities whose budgets currently use those food taxes time to adjust their budgets.

Hobbs’ second beef, though, is just…silly. It wholly ignores those who aren’t on food stamps, the upper reaches of Arizona’s second income quintile, the third quintile, and into the fourth—the rest of the poor, and the middle class. And those Arizonans who are Evilly Rich and have more money than the Progressive-Democrats think they should have.

Just—pay up, suckers.