IRS targets poorest households in U.S., study finds

I know you’re being snarky, crisp as a fresh dill pickle, but also good for calling that out.
Around here, at least, there are lots of community programs for the poor and/or elderly to get their taxes done free of charge by community volunteers who all use tax programs provided by either the local library or the municipality or state, whatever.
So…just not true.

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Depending on how you look at it help is on the way…

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Also among the reasons are the poorest households are more likely to live on a cash basis, having the least ability to obtain bank accounts, direct deposit, and less than predatory credit cards. Small businesses working for cash, off the books work paid in cash, more likely to pay for things with cash as opposed to having an electronic financial paper trail.

The IRS generally doesn’t go after salaried W-2 employees for audits because they know where their income source is and there is only so much shenanigans they can put on their 1040. They love going after small businesses, sole proprietorships or small corporations. Where income is likely to be hidden and the corporate veil likely non-existent. They also go after people on public assistance because Republicans are @$$holes.

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It’s a start, I guess, but the agency has been so severely gutted over the years that this is nowhere near where they need to be if they’re going to have enough resources to go after the rich folks, where the real money is.

Increasing higher tax enforcement among the wealthy is the most cost effective way to bring in more revenue, and we don’t even need to pass new laws to do it.

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I wonder if IRS agents’ job performance is based on how many audits they complete rather than how much money they bring in through said audits. If so then it’s easy to see why they’d go after the poor; you could stick it to a few thousand working-class folks for the amount of effort you’d spend wrangling with one Billionaire’s army of accountants and lawyers.

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Most of it done not on behalf of the accounting industry (which would survive doing corporate taxes) but by Intuit.

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Tax programs cost money.

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Being poor aint cheap.

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It’s accurate, if not reasonable. In addition to what @ClutchLinkey alluded to regarding the lowest earners paying a disproportionate share of their income, in the USA we are expected to act as our own tax experts and accountants. For most earners this means that a portion of your income is (usually, not always), deducted from each paycheck to pay local, state and federal taxes. You fill out a form upon employment stating how many dependents you have, which is how your tax deduction is calculated. That sounds straightforward, but for a one-page document it is incredibly complex and has massive implications for the end of year filing. Assuming that the payroll company even enters the info correctly (it took me two years once to get my status changed from married to single out of pure incompetence), you could end up over- or under-paying your taxes by a significant amount.

At the end of the year, each payer has to go through the entire tax code to seek out allowances, deductions and credits to apply which also dramatically changes whether you are over or under your owed taxes. Some of these are “pre-tax” and some are “post-tax” and they exist at every jurisdictional level. At the end of that, if you did happen to over pay during the tax year, you get a refund (minus the substantial cut for the tax preparer). Otherwise you are expected to settle the bill immediately or enter into a payment contract. It used to be that if you had any tax complications at all, you absolutely had to go to a tax accountant to file properly. As you can imagine, all sorts of bias factors into this and the accountant could just “forget” to inform you of an eligible deduction if, say they didn’t like the color of your skin. And no one at the IRS is going to let you know that you didn’t apply for a credit you deserve. You are literally left on your own to navigate an impossibly complex, biased system. Fortunately, tax software has really evolved over the past 15 years and catches most of this, but many people don’t have access or aren’t even aware and still go to predatory tax accountants.

Really seems like the government should be able to set all of this out at the beginning of the year so your taxes could be withdrawn without requiring end of year adjustments, right? Unfortunately, our government runs on the shifting breezes of political ambition, so a change in taxes can be made literally days before the end of tax season.

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Now you’re just getting me riled up, but I noticed a few years ago that if I “underpaid” my state taxes throughout the year (they collect quarterly for self-employed), I had to pay the full amount plus interest at the end of the year. A pretty high rate, too.

But if I overpaid, when I got my refund back, they didn’t have to include any interest.

Rigged in pretty much every possible way, our system is.

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Everything costs money, but as other helpful posters have pointed out help is available but i guess you skipped that part to get a pompous riposte in quickly and not have to do any further reading.

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Tighten that up a little bit and you have a great bumper sticker

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Just wtf is to be gained from this? Unless they think these households are making 100’s of thousands of dollars and lying about their income? which I mean I guess requires not taking the headline at face value.

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I can’t make heads or tails of it either. There are some suggestions above, the one about people making under $25k having income sources that are harder to verify might be part of it (cash jobs, seasonal work, a series of short term jobs, these might be considered automatically more suspicious, idk)

Another thing that occurs to me is that a lot of these targeted people might be receiving government assistance - if you think about all the hoops they make people jump through to get what should be freely given, it also makes sense that they’d hassle you on the tax end also. Republican lawmakers love to make it hell to get assistance and are quick to assume everyone receiving benefits is a cheat of some kind.

And finally, it’s super vague but I remember some study that said that it’s easier to get $X/year in recovered tax from the poor and middle class than from the classes above them, even though the total amount of avoided tax in the higher brackets is more. The rich fight back, the poor and middle classes give in and pay.

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They can justify the existence of their broken-by-design system by saying “we audited X-thousand returns this year” without actually inconveniencing ultra-wealthy people. The financial collections are almost beside the point.

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Not for the people we’re talking about being targeted in this article.
See:

Income threshold for free assistance and software is around $73,000.

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Just a few minor modifications :wink:

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Hah, ok, fair enough.

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Laughs in German tax forms.

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How about:

90% pay taxes
9% pay accountants
1% pay politicians

I suspect those numbers are off a bit. Maybe something like 50/45/5 or thereabouts.

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