Uncategorized

Sequestration Good for Tax Cheats

20 December, 2013



It was bad enough that 1099′s and other tax forms had to be delayed because of the    year-end fiscal cliff fiasco.  Those of you who count on getting your income tax refunds early took it on the chin on that one.  Now that the automatic budget cuts, known as Sequestration, are kicking in on tomorrow, it’s very likely the Internal Revenue Service is going to get smacked pretty hard.  Now, before you get all excited, consider this:

   *  Layoffs at the IRS will mean fewer people to answer calls and help taxpayers.  The IRS says more than 115 million people called for help last year, but only 68% got through to a person.  And that was after waiting for more than 15 minutes

   *  Of the 10 million written inquiries mailed to the IRS last year, nearly one million nevergot a response.  Not so good if you are the one with the question  

   *  The agency has been operating at a reduced budget the last couple of years…and has cut more than 10,000 employees via attrition 

   *  Expecting a refund?  It’s going to take longer to get it.  Just what you wanted to hear

  *  The Taxpayer Advocate Service told Congress last month that more resources were necessary to make the IRS more user-friendly.  Reducing the operator hours at IRS call centers will not be helpful

But the most annoying aspect of Sequestration may be the opportunity for tax cheats.  People who play fast and loose with their tax records, or just plain misrepresent their income or expenses, may think they’ll be able to slip through the cracks because there will be fewer IRS agents to review tax returns.  POLITICO reports that the IRS collected more than $55 billion from tax cheaters in 2011 when the agency had about 22,000 tax revenue officers.  Sequestration may furlough 1,800 of those officers which will cost the government…YOUR government…billions in lost tax revenue.  So, the deficit will go even higher. 

I don’t know about you, but I’m getting pretty tired of the management by self-inflicted crisis in our nation’s capital.  Tell your Congressman/Senator what you think.  Good luck on your taxes, by the way.  Until next time, here’s to good planning!

www.MoneyTipsOnline.com

Get helpful financial tips every week at www.MoneyTipsOnlineBlog.comor subscribe to it directly on your Kindle:  http://www.amazon.com/gp/product/B008467I98

CR9083



You Might Also Like

Comments are closed.