Taxable Talk

It’s a topic that, frankly, bores the media. It’s a topic that the current Administration would love to go away. It’s a topic that should never have arisen. It’s a topic that underlies the current crisis that impacts the IRS. It’s the IRS scandal.

It’s not something that you will see often in the newspapers. Surprisingly, today’s Las Vegas Review-Journal carried an op-ed from Victor Davis Hanson (that first appeared in the National Review) titled “America’s Politicized Tax Enforcement Is a Harbinger of Decline.” Mr. Hanson argues that when the law becomes negotiable civilization collapses. The IRS scandal is yet one way that we are not a nation of laws–and that appears to be the direct result of the current Administration.

Earlier this week the Wall Street Journal had an editorial titled, “The IRS Goes to Court.” You usually can’t tell how an appellate court will rule from oral arguments; that wasn’t the case here. As noted by the Journal,

Poor Ms. McLaughlin was sent to argue the indefensible so the IRS can delay discovery until the waning days of the Obama Administration. “If I were you, I would go back and ask your superiors whether they want us to represent that the government’s position in this case is that the government is free to unconstitutionally discriminate against its citizens for 270 days,” said Judge Garland.

Ms. McLaughlin replied, “Well, I will take that back.” The Beltway media may be bored, but the IRS scandal is a long way from over.

Have you tried to call the IRS lately? I have to as part of my job. I even get through–sometimes. I have to call tomorrow and maybe I’ll get lucky. Coincidentally, Karen Hawkins, Director of the IRS’s Office of Professional Responsibility, recently submitted her resignation. In her letter to the tax professional community, she said (in part):

I have had the pleasure to meet and talk with literally thousands of you at this juncture. I know you are solid ethical and professional people making every effort to serve your clients and tax administration in appropriate ways. It is important as you continue in your profession that you remain mindful of the overriding broad ethical principles contained in Circular 230 and resist the temptations to “get away with” the behavior less scrupulous individuals use to lure and keep clients. The recent litigation setbacks associated with tax return preparer regulation have been discouraging for all of us. Unfortunately, I have no crystal ball on the topic. I do know, however, that it is crucial for those of you who believe an ethical, fair, transparent and credible tax administration system is absolutely essential to this country to continue to practice your trade at the highest level and to press others for the same.

I agree with Ms. Hawkins that an ethical, fair, transparent and credible tax administration is essential. That said, I believe the IRS’s priorities should change to help implement that:

– Why is the IRS engaging in a “Washington Monument” strategy with their declining budget? (A “Washington Monument” strategy is to cut the most visible areas or most appreciated areas first.)
– Why is the IRS having employees while on the clock doing work for the employees’ union?
– Why is the IRS deliberately engaging in actions that are not fair, transparent, and credible such as the Z Street litigation?
– Why have many actions of the IRS impinged on tax professionals ability to service clients? Not only does this increase the workload for tax professionals, it increases the workload for the IRS.

The IRS’s budget isn’t going to be increased until the root cause of the IRS scandal is known. That’s a fact. It’s now been over 730 days (Monday will be day 732) that the scandal has been ongoing. If a Republican wins the White House in 2016, we’ll likely know what happened by day 1460. Otherwise, who knows.

Tags: IRS.Scandal

This entry was posted on Sunday, May 10th, 2015 at 7:41 pm and is filed under IRS. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.