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0 pointsarcticbull6y ago0 comments

The IRS sees maximum revenue at the point where everyone is paying their taxes as specified in the IRC. Anything short of that, people are evading taxes, intentionally or unintentionally. You are in fact arguing that the state shouldn't necessarily collect all it's owed. I doubt that attitude would get you far in the Accounts Receivable department at any business.

It's different with police officers because the number of crimes is un-countable [1] and if you point the police at anyone they'll find crimes. The same isn't really true of a W-2 employee with a 401(k). The taxes due are by definition countable and the compliance process is largely automated. You are just responsible for truing it up at the end of the year.

[1] https://www.wsj.com/articles/SB10001424052702304319804576389...

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6 comments · 2 top-level

nostromo6y ago· 3 in thread

> if you point the police at anyone they'll find crimes.

The same is true for our tax laws. I can almost guarantee every adult over 30 has made an error in their tax return.

There are a million examples. Here's one: do you know someone that has stayed with a friend or family member rent free? The guest should have claimed the fair rent value of this non-monetary "gift" on their tax return. But literally nobody does.

sokoloff6y ago

Gifts between individuals under $15K/yr have no tax consequences.

arcticbullOP6y ago

And if I'm not mistaken the amount over $15K counts solely to reduce your $11,400,000 lifetime exclusion, and only once you exceed that number do you actually have to pay taxes. [1]

[1] https://www.nerdwallet.com/blog/taxes/gift-tax-rate/

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arcticbullOP6y ago

Errors are fine, you don't go to prison for an error. You get audited, the IRS takes a look, they tell you how much you actually owed, plus interest. I actually don't mind the additional scrutiny this will bring to dark corners of the tax code. The reality is we owe it today, and if we realize it, there may be a bigger push to simplify the tax code down (to be clear, this does not mean reduce tax burden, but just reduce complexity).

Let's take this down a level. If your friend owes you $200, and paid you back $150 because of an honest mistake, does that mean your friend no longer owes you $50 because, oops? Of course not. This is no different at the scale of the IRS.

toast06y ago· 1 in thread

> You are in fact arguing that the state shouldn't necessarily collect all it's owed. I doubt that attitude would get you far in the Accounts Receivable department at any business.

Most AR departments will, in fact, be willing to write off some of what they're owed. There's a cost to pursuing the debts, both in employee time and in goodwill.

arcticbullOP6y ago

Sure, that's totally true, however that's clearly not what's happening here. The budget is 11B, down 19%/2.5B from peak. This yielded a reduction in collections of $34.4B. That's a 10X ROI. We're not talking about negative or marginal returns here, which is what an AR department would write off.

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6 comments · 2 top-level

nostromo6y ago· 3 in thread

> if you point the police at anyone they'll find crimes.

The same is true for our tax laws. I can almost guarantee every adult over 30 has made an error in their tax return.

sokoloff6y ago

Gifts between individuals under $15K/yr have no tax consequences.

arcticbullOP6y ago

And if I'm not mistaken the amount over $15K counts solely to reduce your $11,400,000 lifetime exclusion, and only once you exceed that number do you actually have to pay taxes. [1]

[1] https://www.nerdwallet.com/blog/taxes/gift-tax-rate/

1 more reply

arcticbullOP6y ago

toast06y ago· 1 in thread

> You are in fact arguing that the state shouldn't necessarily collect all it's owed. I doubt that attitude would get you far in the Accounts Receivable department at any business.

Most AR departments will, in fact, be willing to write off some of what they're owed. There's a cost to pursuing the debts, both in employee time and in goodwill.

arcticbullOP6y ago

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