Emboldened by the allocations from the Inflation Reduction Act, the IRS seeks to target millionaires and billionaires as its first order of business.
March 4, 2024
By: Bobby Casey, Managing Director GWP
Oh nos!!!
The US government spent $6.13 TRILLION in fiscal year 2022. That’s close to $16.8 BILLION per DAY (no holidays, no breaks!). The wealthy basically aren’t funding 9 days of spending per year.
Fun fact: the federal revenue of that same year was $5.03 TRILLION. It was running a $1.1 TRILLION deficit. And those blasted rich people could’ve made it an even $1TRILLION deficit were it not for their insufferable greed!
Well, Elizabeth Warren puts it differently:
Tax cheating by millionaires and billionaires costs us more than $150 billion a year. That’s a staggering amount — enough to fund universal child care and then some. The IRS is doing its job by cracking down on wealthy tax cheats.
What a disingenuous load of nonsense.
A drop in revenue isn’t a cost. Costs are outlays. It doesn’t cost you anything for me not to give you money. That is manipulative hogwash.
And as if universal childcare was ever on the table, Liz! It’s not like when the IRS starts collecting this money that daycare will suddenly be funded. It won’t.
Liz doesn’t have a bill sitting there waiting for these collections to happen that will redirect it all to daycare. What she’s doing is translating the amount into something a lot of people want, but no one actually gets. She is taking advantage of the common person’s struggle to conceptualize what one trillion as a number is.
Assuming the IRS could capture every cent technically owed, it wouldn’t even cover the INTEREST of the debt the US has, which is $659 BILLION.
It would only service 22.7% of the INTEREST of the US debt!
I’m sorry for all the caps and exclamation points, but it’s just too ridiculous.
If you remember, the Inflation Reduction Act was going to give $80 billion over ten years to the IRS. The Republicans were able to reduce that number to $60 billion over ten years.
CNBC reported:
The Treasury Department said last week it estimates greater IRS enforcement will result in an additional $561 billion in tax revenue between 2024 and 2034 — a higher projection than it had initially stated. The IRS says that for every extra dollar spent on enforcement, the agency raises about $6 in revenue.
The article continues with Danny Werfel, commissioner of the IRS, saying the agency is targeting those who own private jets.
[The IRS] started using public databases of private-jet flights and analytics tools to better identify tax returns with the highest likelihood of evasion. It is launching dozens of audits on companies and partnerships that own jets, which could then lead to audits of wealthy individuals.
The other group they are targeting are “limited partnerships”:
Another area that is potentially rife with evasion is limited partnerships, Werfel said, adding that many wealthy individuals have been shifting their income to the business entities to avoid income taxes…
The IRS has launched the Large Partnership Compliance program, examining some of the largest and most complicated partnership returns. Werfel said the IRS has already opened examinations of 76 partnerships — including hedge funds, real estate investment partnerships and large law firms.
They are coming for corporate structures. Not all at once, but they are going to start shuffling through them.
As if that wasn’t infuriating enough, the IRS did this to themselves.
“For complex filings, it became increasingly difficult for us to determine what the balance due was,” [Wefler] said. “So to ensure fairness, we have to make investments to make sure that whether you’re a complicated filer who can afford to hire an army of lawyers and accountants, or a more simple filer who has one income and takes the standard deduction, the IRS is equally able to determine what’s owed. And to us, that’s a fairer system.”
He’s complaining the tax code is complicated and it takes a lot of man power to sort out what is owed. Well you don’t say?! You make an absurd tax code and then bemoan the costs of following it? He could choke a bull elephant on all that audacity.
Here’s what the unwashed masses spend on your precious taxes, Mr. Wefler:
- Taxpayers spend $104 billion a year on out-of-pocket expenses associated with preparing and submitting tax forms. Some entail basic costs such as making copies of financial statements, receipts, or forms.
- Americans also spend an estimated 6.55 billion hours complying with the tax laws. We can calculate the value of this burden using average private sector labor costs – which rose by 5.6 percent since a year ago – as a $260 billion per year time drain.
- The cumulative time spent each year on taxes stretches out to over 747,000 years. With the average 77-year life expectancy of an American, the amount of time devoted to tax compliance this year alone would consume 9,700 human lifetimes. The first Homo sapiens appeared around 300,000 years ago, so. 747,000 years is more than double the amount of time our species has been on the planet.
The government created a problem that costs everyone inordinate amounts of money to avoid penalties. That same problem takes another inordinate amount of resources to enforce. At this point, not only are people paying to avoid penalties, but the cruelest part is that it is all so they can pay for their own oppression.
Click here to get a copy of our offshore banking report, or here to become a member of our Insider program, where you are eligible for free consultations, deep discounts on corporate and trust services, plus a host of information about internationalizing your business, wealth and life.
