IRS Defends Its Policy Of Not Penalizing Small Errors
The big argument between TIGTA and IRS is on the negligence penalty. TIGTA being a bunch of hard-assed internal auditors figures that if somebody omits income they were negligent – end of story. (Remember the negligence penalty is for the misstatements that misstate the tax by less than 10%). The programmatic approach of AUP is to let people off with a warning the first time. Thus the for the lower understatements a negligence penalty is only proposed for “repeaters” i.e. somebody who has previously been dinged in the last four years. TIGTA does not think there is any support for this easy going approach.
President Obama Challenges IRS Scandal Narrative
There is one thing that I noticed that is subtle, but I think a big deal. Stewart did not ask the President about the IRS (His main focus was the Veterans Administration). The President picked the IRS to use as an example. In less than two minutes he denied the primary scandal narrative, called for more resources for the IRS and called for corporate tax reform.
Supporters of the scandal narrative can, of course, point out many particulars that are not addressed in the President’s statement – hard drives, the TIGTA report that indicated inappropriate criteria were used. On the other hand they have yet to come up with that really great smoking gun piece of evidence that links the President to all the tsoris that Lois Lerner and the Cincinnati gang that couldn’t sort straight dished out to Tea Party applicants for exempt status. Too bad that the President watched the Watergate hearings when he was a kid and knows better than to have damning tapes like the one I imagined back in January.
Follow Me
Over and over again courts have said that there is nothing sinister in so arranging one’s affairs as to keep taxes as low as possible. Everybody does so, rich or poor; and all do right, for nobody owes any public duty to pay more than the law demands: taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant.