Posts Tagged ‘Romney tax policy’

Tax Roundup, 10/4/12: IRS destroys taxpayer ID theft fraud reports. Also: the return of the Brutual Assault on Reason Watch!

Thursday, October 4th, 2012 by Joe Kristan

Because they’re too busy terrorizing Americans abroad who have bank accounts:  The IRS is Not Efficiently or Effectively Processing Identity-Theft Referrals, reports the Treasury Inspector General for Tax Administration.   From Tax Analysts (subscriber link):

     The IRS failed to investigate thousands of reported identity theft cases because taxpayers failed to follow inconsistent and confusing instructions for submitting a form to report tax fraud, the Treasury Inspector General for Tax Administration said in a report released October 3.

     The IRS instructs individuals to use Form 3949-A, “Information Referral,” to report suspected cases of tax fraud, but not identity theft. However, thousands of people have used the form to report identity theft cases because the instructions for the form are confusing, TIGTA said. Before May, the IRS did not have procedures in place for processing the Forms 3949-A that had been used to report identity theft, and in 2010 the IRS destroyed some 3,000 of the forms that had been used to report identity theft because there was no way to process them, the report says.

The explosion of identity theft has been the biggest IRS problem under Commissioner Doug Shulman’s watch.   Yet he has neglected and bungled the response to the thievery of up to $5 billion annually from the taxpayers so he could botch the “amnesties” for offshore bank paperwork foot-faults and build a new and useless preparer regulation bureaucracy.  His term ends soon; the next Commissioner has a lot of repair work to do.

Jack Townsend has more:  TIGTA Report on IRS Processing of Tips of Fraud

 

Brutal Assault on Reason watch.  I hate campaign debates and won’t watch them.  I agree with Arnold Kling:

To me, political campaigns are not sacred events, to be eagerly anticipated and avidly followed.  They are brutal assaults on reason.  I look forward to election season about as much as a gulf coast resident looks forward to hurricane season. 

But others have stronger stomachs:

Howard Gleckman,  What Did We Learn from the Presidential Debate? Not Much.

TaxProf,  Tax Whoppers in Last Night’s Presidential Debate

TaxGrrrl,  First Presidential Debate, 2012 – Live Blog and Romney Promises To Cut Taxpayer Funding For PBS (But Says He Still Loves Big Bird)

Anthony Nitti,  Reactions To Obama Versus Romney; Round 1

 

Bad idea.  The Romney campaign has floated a proposal to cap itemized deductions at $17,000 as a way to reduce tax rates.  That’s a bad idea for many obvious reasons.  If you are going to do that, why even bother?  Just have a $17,000 maximum standard deduction based on income.   By eliminating the deduction for state taxes paid, it would be a big tax increase on pass-through businesses operating in high-tax states.    William McBride at The Tax Policy blog gets it right:

Today Romney proposed to cap itemized deductions at $17,000, as a way to pay for his cut in personal tax rates.  This is not sound tax policy, as it would complicate the code, and likely require a number of exemptions and other loopholes.  For instance, how would legitimate business deductions be dealt with?  Which ones are legitimate? … It would be better to eliminate entirely certain wasteful tax expenditures, while lowering rates.

Other coverage:

Robert D. Flach,  LIMITING ITEMIZED DEDUCTIONS?

Martin Sullivan,  Romney’s Intriguing Idea (Tax.com)

Going Concern,  What Are People Saying About Mitt Romney’s Tax Deduction Cap Idea?

Kay Bell,  Romney suggests overall itemized tax deduction limit of $17,000

 

In non-campaign news:

Peter Reilly,  Navajo Nation Member Treated As New Mexico Resident For Income Tax Purposes

 Trish McIntire,  Kansas Taxing Business Losses

Jason Dinesen,  Would a New Name Help Enrolled Agents?  The new IRS “Registered Tax Return Preparer” designation can only be bad news for Enrolled Agents, whose much more stringent standards are little understood outside the professional world.  Many taxpayers have no idea of the distinction between these IRS-awarded titles.

News you can use: How To Make Partner In Five Easy Steps (or Don’t Give Up Now, Many Partners Are Going To Die Soon) (Going Concern)

 

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