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  #1 (permalink)  
Old 04-15-2007
Cato Cato is online now
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When, oh when...

... are we going to get rid of this group of jack-booted brownshirts?

I.R.S. Audits Middle Class More Often, More Quickly
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  #2 (permalink)  
Old 04-15-2007
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Re: When, oh when...

Audits are good. They catch people who aren't honest on their returns. I'd like to see more audits, not fewer.
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Old 04-16-2007
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Re: When, oh when...

Quote:
Originally Posted by pramjockey View Post
Audits are good. They catch people who aren't honest on their returns. I'd like to see more audits, not fewer.
I agree, although they should be applied fairly. There is no point in having a law if its not enforced. Of course, all we need to do is get rid of the income tax and replace with a sales tax and fraud will go down.
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Elminate all taxes on income and replace with a national sales tax.
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Old 04-16-2007
Cato Cato is online now
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Re: When, oh when...

Quote:
Originally Posted by pramjockey View Post
Audits are good. They catch people who aren't honest on their returns. I'd like to see more audits, not fewer.
With a tax code even the IRS doesn't understand, audits too often catch people who simply don't know what they're supposed to pay.
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Old 04-16-2007
Hudson Hudson is offline
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Re: When, oh when...

Quote:
Originally Posted by pramjockey View Post
Audits are good. They catch people who aren't honest on their returns. I'd like to see more audits, not fewer.
I would like to see more audits on politicians, their families, their friends, etc. Keep in mind, I used to do that for a living.
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Old 04-16-2007
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Re: When, oh when...

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Originally Posted by Hudson View Post
I would like to see more audits on politicians, their families, their friends, etc. Keep in mind, I used to do that for a living.
Sure. More across the board. Look at the estimates of tax fraud. That's people stealing from the pockets of those of us who actually file accurately.
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Old 04-16-2007
Hudson Hudson is offline
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Re: When, oh when...

Quote:
Originally Posted by pramjockey View Post
Sure. More across the board. Look at the estimates of tax fraud. That's people stealing from the pockets of those of us who actually file accurately.
And it comes first with politiicans, but that is just my opinion.

But the main reason why middle class taxpayers are audited more is because the income beaket has the highest income verification ratio of any income group: above $200000 and below $50000. Additionally, a lot of middle class taxpayers have deductions that are based on intent; thus if the intent was for busness or investment, then it might be deductible. If it was based on personal use, it is not. Nothing is more apparent than investment expenses where anything and everything is attempted to be deducted, but there are other areas as well.
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Old 04-16-2007
Hudson Hudson is offline
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Re: When, oh when...

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Originally Posted by jviehe View Post
I agree, although they should be applied fairly. There is no point in having a law if its not enforced. Of course, all we need to do is get rid of the income tax and replace with a sales tax and fraud will go down.
I take it you never been through a sales tax audit? IRS audits pale in comparision and the only way to survive a sales tax audit is to have an immaculate set of records.
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Old 04-16-2007
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Re: When, oh when...

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I take it you never been through a sales tax audit? IRS audits pale in comparision and the only way to survive a sales tax audit is to have an immaculate set of records.
Sure, but the point was that under an ideal sales tax system, which is infinetly more simple and fair, there is less desire for fraud, making audits less neccesary. Plus, with a simple system, there is less to keep track of, making auditing eaiser.
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Old 04-16-2007
Hudson Hudson is offline
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Re: When, oh when...

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Originally Posted by Cato View Post
With a tax code even the IRS doesn't understand, audits too often catch people who simply don't know what they're supposed to pay.
The biggest problem with the tax code is that Congress keeps changing it way too often. Look at last year where the code was amended three times, including the Tax Relief and Health Care Act of 2006, which was signed on Dec 20th, 2006. And then there were two other bills signed in MAy and August of the same year. That

Additionally, IRS audits are tame. You do have rights, but if you cannot produce the necessary documentation to claim the deduction or credit, then your tax will go up. There is nothing the IRS can do about that. Keep very, very good records.

Finally, no one likes to pay taxes or hospital bills. But that is another topic.
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Old 04-16-2007
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Re: When, oh when...

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You do have rights, but if you cannot produce the necessary documentation to claim the deduction or credit, then your tax will go up.
Guilty until you prove yourself innocent.
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Old 04-16-2007
Hudson Hudson is offline
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Re: When, oh when...

Quote:
Originally Posted by jviehe View Post
Sure, but the point was that under an ideal sales tax system, which is infinetly more simple and fair, there is less desire for fraud, making audits less neccesary. Plus, with a simple system, there is less to keep track of, making auditing eaiser.
the problem is it is a fallacy to have an "ideal" sales tax system. By the time the legislative body get through with HR25 or any other bill, you will have exemptions, exclusions, and partially taxable items under the sales tax. It will not be simple. Heck, even local state sales tax systems are complicated when it comes to what to tax and what not to tax.

We could make the inocme tax system very simple:
Line 1: How much money you received
Line 2: Send it to the IRS.

Last edited by Hudson; 04-16-2007 at 07:04 PM.
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Old 04-16-2007
Hudson Hudson is offline
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Re: When, oh when...

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Originally Posted by Cato View Post
Guilty until you prove yourself innocent.
You are not being found guilty of a crime. It is merely an administrative issue of what you think the tax should be and what the government, through the tax code, the tax should be. It is not a problem if you have the proper documentation to show how you calculated the deductions, credits, taxable income, etc.
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Old 04-16-2007
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Re: When, oh when...

Quote:
Originally Posted by Hudson View Post
You are not being found guilty of a crime.
Yet you can go to jail and have all your property seized.
Quote:
It is merely an administrative issue of what you think the tax should be and what the government, through the tax code, the tax should be.
It doesn't matter what you think the tax should be. The bottom line is: what does the government think it should be? And given that the tax code is so arcane and convoluted that not even the IRS knows what it means (the very antithesis of why we have written laws in the first place) it should be enough that your guess is as good as the government's. But that's not how it works.
Quote:
It is not a problem if you have the proper documentation to show how you calculated the deductions, credits, taxable income, etc.
Vee haf no probleem. Zimply show me your paperz und you may be on your vay. Uv course, your paperz must match our official paperz.

Seriously, Hudson, I understand there is a legitimate reason for taxes, and therefore a legitimate function for a tax collecting authority. We are simply going about it wrong. This agency has far too much power and wields it far too irresponsibly. We need to find a better way.
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Old 04-17-2007
Americano Americano is offline
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Re: When, oh when...

Having personal (and business) tax work completed by a competent CPA who is registered with the IRS and has factual data from the filer eliminates most audits. Why more people who file with tax reduction deductions don't use them instead of storefront 'tax preparers', popular software or even manual preparation is beyond me. It's definitely a case of getting what one pays for and the general public simply has no idea of tax code complexity.
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