IRS Limited Tax Refunds of Poor, Congress Is Told

[American liberal]

Tax refunds sought by hundreds of thousands of poor Americans have been frozen and their returns labeled fraudulent, blocking refunds for years to come, the Internal Revenue Service's taxpayer advocate told Congress today.

The taxpayers, whose average income was $13,000, were not told that they were suspected of fraud, the advocate said in her annual report to Congress. The advocate, Nina Olson, said her staff sampled suspected returns and found that, at most, one in five was questionable.

A computer program selected the returns as part of the questionable refund program run by the criminal investigation division of the Internal Revenue Service. In some cases, the criminal division ordered that taxpayers be given no hint that they were suspected of fraud, the report said.

<snip>

Ms. Olson said the I.R.S. devoted vastly more resources to pursing questionable refunds by the poor, which she said cannot involve more than $9 billion, than to a $100 billion problem with unreported incomes from small businesses that deal only in cash, many of which do not even file tax returns.

http://www.nytimes.com/2006/01/10/business/10cnd-tax.html

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Unbelievable. Corporate welfare continues unabated, but they go after those who earn, on average, $13,000/year. I am practically numb contemplating the inequeties of this country.

[Kalisiin]

1. Get Used To It

As long as the GOP pigs are in power, the inequities will become greater and greater. Until enough of the people finally stand the hell up and DEMAND equitable treatment, we are not going to get it.

And we will only get it if we can first fix the elections system to ensure those with a vested interest can't.

[Zinfandel]

4. Your correct....GOP --- Greedy Oppressive Pigs

[The Velveteen Ocelot]

2. They do this because poor people can't fight back.

It's easier to collect from them because they don't have the resources to contest anything the IRS does. So even though much less money is involved, the IRS doesn't have to use many of its own resources to get it. Fish in a barrel.

Can I PLEASE move to another country?

[Sydnie]

3. That's scary

I depend on the unearned credeit to support my kids and to get us over the hump when life's little emergencies happen. It is unbelieveable that they would do this.

Tell them to find the money missing in Iraq and leave us poor people alone, for goodness sake.

[TexasLady]

5. If it wasnt already bad enough

that we both work our own very meager businesses...and have several mouths to feed. We dont ask for help from the government at all. My H works around the clock to MAYBE make 15,000, me a measly 12,000 part time. Even after figuring in what little we use for write offs, the taxes about kill us,eating up whatever we WOULD have gotten for a credit!

Hell, we havent seen a decent return in a Loooong time, and dont even break 20 grand a year.

[ComerPerro]

6. gotta make up for those deficits and pay for those tax cuts somehow

[hyphenate]

7. Been there, done that

They audited me when I made $34,000 one year, and right now they're taking part of my disability for saying I owe them $846. Pretty good criminal I am, huh? I'd like to see what they are doing to people like Ken Lay, Jeff Skilling and Dennis Koslowski.

[punpirate]

8. What Johnston neglects to mention in this...

... is that additional oversight of the poor was mandated by Congress. That body wanted more IRS oversight of the poor end because it would diminish the capacity of the IRS to investigate the rip-offs of the wealthy and corporations, the returns from which do not show large returns, but, rather, generally evade paying taxes owed on investments.

[Trillo]

9. More secrecy

Once a return is flagged, requests in future tax returns are also frozen for a number of years that the advocate said she is not allowed to disclose because it goes to law enforcement techniques.

Reminds of NSA spying and FISA disclosure problems. Must be systemic. What else can it be besides standard operating procedure?