The official blog of the Libertarian Party
January 12, 2006
IRS Froze Tax Refunds Intended For the Poor
The Taxpayer Advocate Service, an agency the Internal Revenue Service established to handle taxpayer complaints, issued a report on Tuesday stating that the IRS had improperly frozen thousands of tax refunds. The majority of the frozen refunds were intended for the working poor, according to Nina E. Olson, head of the Taxpayer Advocate Service.
In its report, the agency admonished the IRS's practice of freezing taxpayer refunds and having the returns deemed fraudulent, as it stated, the IRS "cannot and should not treat every taxpayer as a tax cheat." The agency examined a sample of such cases brought to its attention last year and found 80 percent of the cases had the IRS paying full or partial refunds, the Los Angeles Times reported.
After the IRS freezes a refund, the affected taxpayer often experiences a typical delay of more than eight months. In many instances, the affected taxpayers do not know that their refunds have been frozen.
The Taxpayer Advocate Service's report noted the lack of notification by the IRS's Criminal Investigation (CI) division when they have frozen taxpayer refunds. The report stated, "Even in cases where CI has made 'conclusive' determinations of fraud and characterized the taxpayers as 'criminals,' it has not provided the affected taxpayers with any notice or opportunity to present documentation to rebut CI's suspicion before a final 'determination' is made."
The report raised some serious concerns among a few congressmen. Senate Finance Committee Chairman Charles E. Grassley (R - Iowa) commented on the findings of the report, by stating, "Refunds have been a source of abuse recently, but we need to make sure taxpayers have proper due process when the IRS decides to freeze a refund."
Critics have questioned the IRS's use of "data-mining" computer software that is designed to look for tax returns that show possible signs of fraud. Leslie M. Book, a professor at Villanova University who runs a tax clinic for the poor, says the computer program is a blunt and unfair tool in fighting fraud.
Posted by at January 12, 2006 02:16 PM
Reader Comments:
When you allow yourself to be robbed and to be treated as cattle by the government to begin with, this will happen sooner or later. The idea of a "Criminal" Investigation Division within the biggest criminal organization in the history of the U.S. is as ludicrous as having the KKK police itself for racism. Within the next 10-20 years, the Middle Class will be all but gone. We only have ourselves to thank and to blame.
The "tax refund" checks that one normally receives after he files his income tax return -- that is, one who reports his income being less than $20,000 a year on his tax return -- are a fraud in themselves.
The reason I say this is that a "tax refund" is simply a cash handout to individuals who make a certain less amount of money, thanks to the provisions of the Earned Income Tax Credit. It's the equivalent of a mugger who just stole $100 from your wallet, and then ends up having a guilt trip over taking the money. He then turns to you and says, "Gee, I'm sorry, but I stole way too much money from you, so I'm going to give you back $40 of the $100 I stole from you, but I get to pocket the rest."
That's exactly what the "tax refund" is, in simpler language.
Yours in Liberty,
Todd Andrew Barnett
Please keep links and comments relevant to the topic at hand. If you question if it is or is not relevant, then it probably isn't. Thank you.
I do not see anything here that is not related to the tax topic, everyone of the above post is related, to bad you didn't say anything about fowl language used in past post.
The whole situation is digusting. I myself keep my withholding as low as possible so that I end up owing at the end of the year. That way I can hold on to my money for as long as possible, and second of all, they can't freeze a refund if they don't owe me one in the first place. :)
In fact, I expect to mail the check to the IRS a few seconds before midnight on April 15th and not one moment earlier.
For those who are interested.
freerepublic.com/focus/f-news/1044024/posts
read the part that is a very good post
by chance33_98
FReepers discovered LP.org. Lovely.
Run along back and bump a grift-a-thon thread or something.
It sucks. But what sucks worse is that many of the people who need those refunds the most are targeted. And I'd be willing to bet it's over minor things.
Solution: abolish the income tax entirely. It's economic terrorism.
One question no one has brought up: do you really trust an advocacy agency created by the same people who take your money?
Isn't this something like the fox opening a hen abuse house?
Remember, only an uber Al Capone could have brought down Al Capone. This is what we all have to deal with each and every April 15.
"The power to tax, is the power to destroy".
there is gross tax fraud in dallas alone. the irs should take the obligation to investigate all taxes prepared other than that of HR block.
HEY CHRIS HERE SOMETHING WAY OFF TOPIC,
someone posted three different post on the
HISTORY REPEATING itself in Iran Blog section at the bottom.
Smoking, US SEARCH, and the etc. actually I do not care for all the list along with the US Search very easy to find someone as well. HOW COME your picky about what you consider is off topic. I think some things that get posted are very important issues that get missed. While other are just that.
The other posting that has nothing to do with freedom that on that blog is advertisement for Satellite TV.
I WOULD LIKE TO suggest a BLOG TOPIC, what are we going to do to promote 2006 and 2008 ELECTION TO GET THE WORD OUT BETTER?
Please send any blog suggestions to info@lp.org. Thank you.
This is just one example of many, why the IRS needs to be abolished and the stupid Income Tax to be simply replaced with the FairTax.
MAJOR OK lets start the Petition. how about the petition to be posted here in place of or added to get rid of the death tax and a forward to friends as well when you come to the lp site.
YES, time to change the tax system.
It certainly does look like the middle class is being eroded. Glad I'm not poor.
I am in agreement with Majorfallout. The 16th Amendment establishing the income tax should be repealed along with the IRS. The FairTax should replace it all. This story proves to me that that should be done and carried out.
If anyone truly cares about the poor and working class, the income tax (along with capital gains and estate taxes) should be repealed along with the job-destroying minimum wage.
The income tax unfortunately will never be repealed. The reason is that more and more folks are getting off from paying any income taxes at all and many get refunds in spite of paying in nothing (see welfare). Presently 50% of the folks pay 97% of all income taxes. The trend is moving towards that less than 50% will be paying 100% of all the income taxes. When the majority pay no income taxes, there will be little chance for change.
JD...
Perhaps, but when the "untouched" 50% learn that the 7.8% payroll tax they pay, when added to the 23% EMBEDDED COST of the income tax system, actually puts them in a 30%+ effective tax bracket, we may see some movement.
www.fairtax.org
My recollection of Medieval History tells me that the serfs only had to pay the Baron's no more than 20 to 25 per cent total of their individual crops with no hidden back charges.
If that is correct, then what are we and how much more is it going to take before we reclaim our lives and liberty?
http://www.walken2008.com/
Any opinion on this? This guy seems to come across as a Libertarian?
You think this could be a good candidate?
Thats a gag site. The best clue should be thats its hosted on a gamers hosting solution. He's not running for anything, or it would be not the media somewhere. It's not.
It sucks that the government has an 80% failure rate on detecting fraud in these cases (they should look into it) but saying that they're robbing from the poor?
If a country is going to collect taxes and have a government; it makes sense to me that an individual should pay more taxes if that individual recieves more government services.
I have been on both ends of the bracket and you know I never felt like I got more services for my extra money.
I want to know why many people pay more in federal taxes than these folks entire yearly income? I'm all for reducing federal services and making a lot of these decisions local decisions.
"I want to know why many people pay more in federal taxes than these folks entire yearly income?"
Because they have the most tangeble property that can be attached, siezed, frozen and garnished. Thus they are the easiest to steal from, they have the most to lose if they don't "voluntarily" co-operate.
Pardon me for posting a test message... the LP Blog keeps auto-rejecting my comments. I am not sure why.
I think that the IRS was origanally a good idea until we decided to let facsist start controlling our contry. Taxation is not suppose to be as much as it is to be anyway. We get taxed for income, luxury, sales, state, city, etc. I think the Only thing we should be giving tax to is the social security program and state tax. C entral government has taken to much power in how much money they are going to take out of the paychecks that we earn.
Timothy, you need to study history and economics. The IRS was never a good idea, it steals the work product from every working individual in this country. It is the same as "protection money" to the mob. It made the Government the master and the people the servants, it is pure evil.
The only source of federal revenue should come from import tariffs.
I'm not sure what should local and state government revenue come from. Can somebody help me out and tell me what would be a good source of local and state revenue?
"...what would be a good source of local and state revenue?..." Use taxes. Same as private industry, use their goods and services, you pay for it and encourage plenty of competition. I love REAL Capitalism.
Just testing to check a problem with posting.
When NASA first started sending up astronauts, they quickly discovered that ball-point pens would not work in zero gravity. To combat this problem, NASA scientists spent a decade and $12 billion developing a pen that writes in zero gravity, upside-down, on almost any surface including glass and at temperatures ranging from below freezing to over 300 C.
The Russians used a pencil.
Your taxes are due again--enjoy paying them slaves.
These are not refunds. They're welfare. Refund means that you're getting back all or part of money that you paid in. Most people I know who are "poor" get back MORE than they pay in, but they still call it a "refund".
They should call it what it is: welfare. This is why people think the fedral gummint is Santa Claus.
I think quite a few people that get refunds are getting exactly that...refunds. That is they are getting back the excess witholding they paid in during the proceeding year. Yes, some people are getting money back as a result of the EIC and that is of course welfare. There are other people whose refund checks are a combination of excess witholding and EIC.
So it is not a just statement that ALL people receiving refund checks are on welfare. ONLY those people whose checks include an EIC payment are on welfare. The rest of the people are just getting back the excess money the government stole, er withheld from them.
All in all, I think every individual should endeavour to set their witholding as low as possible to ensure that they end up owing at the end of the year and then withhold that money from the government until the last possible second. If you are getting a refund at the end of the year, you have actually given the government the tax free loan of your money and in addition deprived yourself of the use or interest of that money. I mean, don't set your witholding so low as to risk penalties for underpayment, but go as low as possible.
Ack, in my last comment, I meant ... given the government the INTEREST free loan of your money..... :)
How about LIVING like Libertarians and paying NO TRIBUTE OR "PROTECTION" MONEY. Is it too hard to live by our convictions?
It isn't our inability to "convince" the masses to our way of thinking that has't got us elected to major office. It is our unwillingness to live by our convictions and lay it on the line.
Thank god or whatever you do or don't believe in our founders were not as spineless as we seem to be.
I would direct your attention to:
http://www.givemeliberty.org
I have signed on. Do what you will.
Chuck:
It would be nice. However, my sitting in jail for tax evasion is not going to help the libertarian cause. I will continue to pay my taxes, grudgingly to be sure. And I will fight like hell to get them reduced or preferably eliminated. To those of you who are evading your taxes, I wish you all the luck in the world, at the same time, I am not going to be too sympathetic when you get caught and sent up the river for 10 to 20.
How does one evade something he doesn't owe? If you owned a small business and refused to knuckle under to the mob, would you castigate yourself to evading Uncle Luigi? Until you have the balls to live by your principles you will never be anything but one of the sheeple. That is the hard lesson of life. How far would the civil rights movement have gone in this country if Dr. King had the courage of his convictions that you have? You are ABSOLUTELY CORRECT he had NO impact on that movement WHAT SO EVER.
It is reasoning like yours that has cost us this Republic. People like YOU are why we cannot win, you don't want your cushy life disrupted. So go home, behave yourself, be a good little boy and pay up. Rejoin the Republicrats. With all due respect, stuff your wishes of good luck, slave.
Don't drive a car, pay no license tax. Use a bike instead.
Use candles instead of electric, live out in the boonies,
Don't own credit cards. grow your own foods.
Pay everything cash
We should as Libertarians buy a state and seperate it from the USA
I'm checking under the cushions of my couch, how much can you scrounge up?
| 
When you allow yourself to be robbed and to be treated as cattle by the government to begin with, this will happen sooner or later. The idea of a "Criminal" Investigation Division within the biggest criminal organization in the history of the U.S. is as ludicrous as having the KKK police itself for racism. Within the next 10-20 years, the Middle Class will be all but gone. We only have ourselves to thank and to blame.
Posted by: Chuck at January 12, 2006 04:00 PM