Tax Roundup, 8/20/2012: Meet the criminal masterminds that outwit Doug Shulman’s IRS.

August 20th, 2012 by Joe Kristan

Doug Shulman, protecting the taxpayer

You are sending $5.2 billion annually to identity thieves, courtesy of Douglas Shulman’s IRS.  What sort of criminal masterminds are outwitting IRS internal controls to pick your pockets?  Tampabay.com tells the story of one modern-day Professor Moriarty:

More than 10,000 people remain on a waiting list for federally subsidized housing in Hills­borough County.

Not LaSandra Gamble, 27-year-old mother of five.

Last summer, between housing, utilities and food stamps, she drew benefits of $2,363 a month, Tampa Housing Authority files show.

Yet, in August 2011, she put down $9,000 on a black 2006 Lexus GS430, police said. Three days later, they said, she put down another $9,000, this time on a red 2007 Lexus ES 350. Combined, the monthly payments were nearly $2,000.

Gamble, in an interview, said police have it wrong. She said she got the cars because she was involved with the car dealer.

“I didn’t have to put nothing down,” she said. “We were in a relationship.”

Legally, she was in a relationship with her husband, 33-year-old Angelo Juan Pedrosa, whom she had married a year earlier.

Police got involved Oct. 8, when they stopped Pedrosa driving the black Lexus. Pedrosa is a convicted cocaine dealer. Along with marijuana residue, the officers reported finding $6,000 and a dozen debit cards in other people’s names.

Reloadable debit cards, sold online, carry Visa or MasterCard logos. Some people use them to shop on the Internet, control spending or get around poor credit. Tax thieves use them to collect refunds from the IRS.

Police filed a report with the IRS.  Ms. Gamble denies any involvement with tax fraud.

The gist of the TampaBay.com story is that the multi-billion dollar refund fraud — much of which is based in Tampa — is largely the work of thieves who are also collecting money from you through public assistance, and a motley array of petty thieves.   And Doug Shulman’s IRS is helpless to stop them.

Or maybe they just have priorities other than protecting your tax money.  Priorities like expanding the power of the bureaucracyAn opinion piece in today’s Wall Street Journal by Chip Mellor of the Institute for Justice (via the TaxProf):

Under new regulations imposed last year—without congressional approval—the IRS now requires all paid tax preparers to become “registered tax return preparers” by paying extra fees, passing a government exam, and taking continuing-education classes annually. (Exempted from the mandate are attorneys, CPAs and politically powerful “enrolled agents.”) Big tax-preparation firms such as H&R Block and Jackson Hewitt supported the licensing scheme, as did lobbying groups representing CPAs and others who are exempted from new regulation. 

So while petty thieves loot the Treasury, rest assured that Doug Shulman’s IRS is doing what it can for the well-connected.  For a taste of what it Doug Shulman is doing for those whose identities are being stolen (darn little), check out the newest installment in Jason Dinesen’s saga of a client’s identity theft nightmare.

 

Billy Hamilton of State Tax Notes has a fine history of the Iowa Film Credit up today.  Unfortunately at the moment it is only available to State Tax Notes subscribers (here).  He uses a “film noir” theme to tell the story:

Unless all of the main characters are dead, life continues past the closing credits, and in Johnny’s case, that means arrest and a return to the Big House. But filmmakers and audiences seldom bother with what is, in effect, the story after the story.

     That probably helps to explain why there was minimal press attention when opening arguments began on July 23 in the trial of the last of 10 defendants charged in the Iowa film tax credit scandal that erupted three years ago and was a hot topic at the time in Iowa, in the movie community, and in tax circles.

If you get a chance, read the whole thing.

 

Peter Reilly, Should We Care About Romney’s Unreleased Tax Returns?:

The business culture that both Romney and Warren Buffett have  operated in, as have I at a much less ethereal level, considers overpaying taxes to be irresponsible.  That is the story of Romney’s tax returns.

I’ve not encountered a business culture that considers overpaying taxes to be “responsible.”  Peter’s post is worth reading for the “It’s a Wonderful Life” references alone.

 

Tax Policy Blog: Usain Bolt Serves the UK an Olympic Hangover and At least 90 Percent of Americans Have a Lower Income Tax Rate than Romney

Kay Bell: Romney’s tax returns take 2

Robert D. Flach has been busy, with a new “Buzz” and a look at RYAN’S TAX RETURNS.

Anthony Nitti, Tax Policy Center Fights Back

Jack Townsend, Swiss Banks Rat Out Their Employees to U.S.

TaxDood, Usain Bolt Serves the UK an Olympic Hangover

TaxGrrrl is moving her offices this week, so she makes the best of it with Moving Right Along: Deducting Work-Related Moving Expenses

Good news for Iowa’s Mississippi River towns: Illinois Adopts Strip Club Tax (Russ Fox)

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