Two years ago, Congress determined that the IRS was bullying innocent taxpayers and passed a law requiring the agency to fire workers who harassed taxpayers. At the time the hearings were being held, I wrote that in my 30 years of experience with the IRS I had never encountered a harassing incident of the type being described in Congress. I wondered if perhaps I had led a sheltered life or was the Congress be hoodwinked.
But alas, my defense of the IRS has been vindicated! Not one, no not one, of the first 830 complaints of taxpayer harassment filled under the new law has been upheld as valid. Investigations by the IRS and the new congressionally mandated watchdog, the Treasury Inspector General for Tax Administration, found evidence that some of the complaints were bogus, i.e., made in an effort to derail audits, while others were either without merit or involved minor misconduct that fell far short of harassment. Additionally, most of the testimony of harassed taxpayers before Congress in the 1997-98 hearings has proven to be unfounded, based on false or misleading testimony or disproved in subsequent court actions.
In short, the Congress was hoodwinked and reacted by passing a restrictive law which confounds the IRS’ ability to administer the tax laws. Let’s face it, nobody likes paying taxes. At best, we comply out of a sense of patriotism. For most taxpayers, the threat of a tax audit is necessary to encourage them to do the right thing. A former commissioner of the IRS opined years ago that, in his judgement, 5% of tax returns should be audited in order to achieve compliance with the tax laws. The actual percentage of returns audited today has dropped well below 1%. If you haven’t been audited yourself or know anyone who has been audited in recent memory, there is a powerful temptation to cheat.
Briefly mounting the soapbox, I believe that our tax laws are far too complex to be understood by mortal taxpayers. If we don’t understand them, it is highly unlikely that we will comply. We would be far better off to scrap the existing tax code and start over.
WELFARE REFORM DIDN`T INCREASE CHILD ABUSE
When Congress abolished welfare as a permanent safety net four years ago, there were alarming predictions about the prospect of the foster care system being flooded by a new wave of abused children. Didn’t happen. Two recent studies indicate that the situation has actually improved since welfare reform.
A recent article in The New York Times said that confirmed cases of child abuse and neglect have fallen since 1996. This trend was confirmed in both a private study and by the federal government. Further, the number of children entering foster care has been stable or falling in recent years, continuing the national decline that began slightly more than five years ago.
The forecasted increase in children entering the foster care system was the most emotional argument set forth by those opposing welfare reform. This group feared that the stress of losing benefits or the pressure of having to work would lead to a rise in child abuse and neglect. But the latest findings suggest that since President Clinton reluctantly signed the 1996 legislation placing strict time limits and work obligations on welfare recipients, their children have not suffered as expected.
Once again we are reminded of the resilience of ordinary Americans when government steps aside and takes away the temptation toward dependence. In my view, government programs, which do not encourage transitioning to independent living, should be scrapped. Compassion requires that we make exception for those who are incapable of caring for themselves.
THOUGHT FOR THE MOMENT
I have learned to be content whatever the circumstances.
— PHILIPPIANS 4:11
Joe D. Jones, CPA, is publisher of the Mississippi Business Journal. His e-mail address is email@example.com.