Opinion | Getting the I.R.S. to Crack Down on Tax Cheats

To the Editor:

Re “How to Collect Unpaid Taxes” (editorial, March 21):

Your editorial on the burgeoning federal unpaid tax debt hit the right points. The Collection Division and the Examination Division of the Internal Revenue Service have been understaffed and underfunded for decades. Programs like Offer in Compromise (a settlement option for taxpayers) and Criminal Investigation for tax fraud were on the ropes before Covid-19, and the past year may have put the final nail in the coffin of a functioning tax administration system.

Most frontline collection and examination employees are working remotely, eliminating the ability to have the face-to-face contact with delinquent taxpayers. Over 24 million tax returns from 2019 and 2020 have not been processed. The three stimulus distributions were the responsibility of the I.R.S., without any thought to the impact on other already struggling programs.

Money is thrown in many directions by the federal government. It is past time to throw needed resources to the Internal Revenue Service.

William Redmond
Lexington, Ky.
The writer, a tax consultant, is a former I.R.S. revenue officer.

To the Editor:

Leona Helmsley famously said “only the little people pay taxes.” More recently, Donald Trump made it clear to all Americans that paying taxes was unnecessary for wealthy individuals and businesses, by slashing taxes on the rich and corporations, and through his personal example of manipulating his own returns to avoid paying taxes.

When the little people see the big people not paying their fair share, it shatters the social compact and the concept of the general welfare enshrined in the Constitution.

Michael E. Mahler
Los Angeles

To the Editor:

As an I.R.S. field agent/auditor around 1970 I would average $3,000 per day in taxes brought in to the U.S. Treasury. As a certified public accountant, in the 1980s I scared clients into properly reporting their earnings with threats of I.R.S. audits because they all knew businesses that had been audited. After about 2000 none of my clients knew anyone who had been audited and they would laugh at such encouragement to report all their income.

Republicans and conservatives are supposed to believe in holding the line on government deficits and balancing the budget. We now know that is nonsense. The best way to balance the budget and reduce the national debt would be to hire 10,000 I.R.S. field auditors. Not only would they bring in a massive amount of unpaid taxes, but the whole business community would sit up and take notice when it came time to report their income.

Additionally, stiff fines and jail for the most egregious violators would be very effective. Many tax cheats used to be prosecuted and imprisoned years ago. It was a pretty effective deterrent. Now almost no one is prosecuted.

Alfred Schwartz
Walnut Creek, Calif.

To the Editor:

What’s the best way to collect unpaid taxes? Of course, a robust, fully funded I.R.S. would be a great start, but since that has a low probability of occurring, how about contracting out I.R.S. functions?

Why not contract with specialty law firms to audit big accounts like that of Donald Trump? How about contracting with specialty collection agencies to collect unpaid tax bills with the same vigor we collect unpaid student loans?

The federal government contracts with thousands of vendors for all kinds of goods and services. It’s about time we contracted with capable vendors for tax auditing and collection, too.

Jerry Place
Kansas City, Mo.
The writer, who has degrees in finance and computer science, has been an expert witness in auditing class action suits.

To the Editor:

Collecting unpaid taxes is an excellent idea. But if Congress finds it impossible to strengthen the I.R.S., perhaps in the name of equity it should stop requiring employers to report information about wages and salaries paid to their workers. This would at least distribute the opportunity to cheat on taxes more equally so that it would no longer be a monopoly of the rich and powerful.

Paul F. deLespinasse
Corvallis, Ore.

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