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As if the Internal Revenue Service wasn’t in a boatload of trouble already, a congressional committee charged with rooting out corruption in government is investigating the tax agency for blowing tens of millions of dollars on employee conferences.

The probe comes on the heels of the scandal for the ages, in which the IRS targeted conservative groups applying for tax-exempt status. Organizations with conservative-sounding phrases such as patriot and Tea Party in their titles were singled out by the agency, according to a Treasury Inspector General report that ignited outrage among both Democrats and Republicans alike. Though illegal, this witch hunt against conservatives was rampant at the highest levels of the agency, according to the Treasury watchdog.

This week’s IRS scandal du jour involves $50 million that the beleaguered agency spent on hundreds of conferences for its employees between 2010 and 2012. Media reports began to leak over the weekend attributing the outrageous figure to a Treasury IG report due out this week. The House Oversight and Government Reform Committee, the congressional watchdog that holds government accountable to taxpayers, immediately jumped on it and will hold a hearing on the matter this week.

The conference spending includes $4 million for a 2010 gathering in southern California in which IRS employees stayed in lavish presidential suites that cost American taxpayers $1,500 to $3,500 per night. Attendees also got free alcohol and tickets to see the area’s professional baseball team. To inspire IRS staff, more than a dozen speakers were paid $135,000 in fees, including one who got a whopping $17,000 to talk about “leadership through art.”

Additionally, multiple videos were produced for the conference. One of the videos, posted on the House Government Reform Committee’s website, features IRS employees learning a popular dance called the “cupid shuffle” as they prepared for the California management conference. It’s quite entertaining though enraging that our tax dollars have been wasted on such a venture.

“The IRS is an agency in crisis,” said Committee Chairman Darrell Issa, a Republican congressman from California. “The American people expect that their tax-dollars will be used responsibly and not for financing lavish hotel suites and entertainment for government employees. The Oversight Committee will examine these egregious abuses of the public trust and an IRS culture that shuns accountability.”

Over the years the IRS has been in hot water over a series of transgressions. One of the things the agency is well known for is giving incarcerated criminals who prepare fraudulent returns tens of millions of dollars in refunds they’re not entitled to. The figure increases annually and at last count the IRS doled out north of $35 million to criminals, according to a federal audit.

A few years ago the IRS came under fire for allowing 1 million foreigners—many in the U.S. illegally— to improperly claim close to $9 billion in tax credits even though they did not provide valid Social Security numbers on their return.  Not long after that, the tax agency got in trouble for handing out $33 million in bogus electric car credits.

Just this year, on the heels of “Tax Day,” two dozen IRS employees got charged with stealing hundreds of thousands of dollars in government benefits, including food stamps, welfare and housing vouchers. The scheme fleeced U.S. taxpayers out of at least a quarter of a million dollars, according to federal prosecutors.

 

 

 

 

 

 

 

 

 

 

 

While the Internal Revenue Service (IRS) wastes resources going after conservative groups that have committed no wrongdoing, a wealthy Indian tribe in south Florida cheats the government out of hundreds of millions of dollars in taxes from its lucrative gambling businesses.

Perhaps this is because it’s not politically correct to go after minorities like the Miccosukee Indians, but it is quite ok to pursue groups linked to conservative movements like the Tea Party and other social causes viewed negatively by the left. What other explanation could there be for the huge discrepancy in the way the tax agency treats conservatives and liberals, who may have evaded taxes for years.

The scandal involving the witch hunt of conservatives broke earlier this month after an investigation by the Treasury Inspector General revealed what many conservative groups have known and alleged for years; that the IRS is used by the administration as a political tool to go after its enemies. Though illegal this appears to be rampant at the highest levels of the agency, as the inspector general’s scorching report indicates.

The IRS singles out groups with conservative-sounding phrases such as patriot and Tea Party in their titles when applying for tax-exempt status, the IG says. The probe determined that for more than 18 months the IRS “used inappropriate criteria” that singled out conservative organizations applying for tax-exempt status. This has ignited outrage among lawmakers—both Democrat and Republican—as well as President Obama who called it “intolerable and inexcusable.”

In the meantime, a south Florida Indian tribe has for years failed to pay taxes from distribution of gambling profits to tribal members, according to court records cited in a local news report. The IRS finally slapped the Miccosukee Indians with a bill of $170 million and hundreds of tribe members with separate bills totaling $58 million, the story says. The tribe’s tax evasion dates back more than a dozen years.

This is appalling considering the tribe is very rich thanks to its highly profitable casino enterprise, which nets a chunk of change each year. The wealth is spread among its 600 members, which get a sweet annual payout of up to $160,000 each. Miccosukee officials argue that they’re not obligated to withhold taxes on gaming distributions and that individual members don’t have to pay taxes on income derived from the tribe’s slot machines and poker.

Miccosukee’s Chairman says members won’t be intimidated or coerced into surrendering “tribal sovereignty or principles for which so many of our ancestors have paid a very high price in blood, lives, and tears.’’ Federal law says that the tribe’s status as a sovereign nation means the entity itself is not subject to taxes, however, once casino profits are distributed to members, Uncle Sam must get a cut. In fact, the tribe must withhold taxes on the income and turn the records over to the IRS, according to the 1988 Indian Gambling Regulatory Act.

A prominent defense attorney and accountant quoted in the story finds it “perplexing” that the tribe refuses to pay taxes. Clearly, the feds have allowed it. The Miccosukees are renowned for keeping their lucrative gambling revenues secret and refusing to reveal how money is distributed. In fact, the tribe is the only in the United States that fails to follow federal law when it hands out gambling profits.

So, why didn’t the IRS go after this wealthy tax-evading Indian tribe sooner? The beleaguered tax agency was probably too busy hounding conservatives.

US-POLITICS-TAX-CONGRESS

The Internal Revenue Service’s (IRS) witch hunt of conservative groups similar to Judicial Watch is indeed atrocious, but it’s hardly the first scandal to rock the beleaguered tax agency in the last few years.

This particular crisis exploded after an investigation by the Treasury Inspector General revealed what many conservative groups have known and alleged for years; that the IRS is used by the administration as a political tool to go after its enemies. Though illegal this was rampant at the highest levels of the agency, as the inspector general’s scorching report indicates.

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The IRS singles out groups with conservative-sounding phrases such as patriot and Tea Party in their titles when applying for tax-exempt status, the IG says. The probe determined that for more than 18 months the IRS “used inappropriate criteria” that singled out conservative organizations applying for tax-exempt status. This has ignited outrage among lawmakers—both Democrat and Republican—as well as President Obama who called it “intolerable and inexcusable.”

At a congressional hearing this week, IRS chief Steven Miller apologized for the way his agency has treated conservative groups but he had the audacity to say that partisanship did not serve as a motivation. Rather he attributed his agency’s actions to “foolish mistakes” made by employees attempting to be “more efficient in their workload selection.” He must think Americans are really dumb.

“Partisanship or the perception of politics has no place in the IRS,” Miller assured members of the House Ways and Means Committee, which is investigating the scandal. If that’s true, then it’s just a big coincidence that liberal groups aren’t targeted by the agency. In fact, liberal groups are spared scrutiny and one news report reveals that a foundation operated by President Obama’s half-brother got fast-tracked to become tax-exempt.

This appears to be the icing on the cake for an agency that’s made plenty of headlines over the years for its transgressions. One of the things the IRS is well known for is giving incarcerated criminals who prepare fraudulent returns tens of millions of dollars in refunds they’re not entitled to. The figure increases annually and at last count the IRS doled out north of $35 million to criminals, according to a federal audit.

A few years ago the IRS came under fire for allowing 1 million foreigners—many in the U.S. illegally— to improperly claim close to $9 billion in tax credits even though they did not provide valid Social Security numbers on their return.  Not long after that, the tax agency got in trouble for handing out $33 million in bogus electric car credits.

Just last month, on the heels of “Tax Day,” two dozen IRS employees got charged with stealing hundreds of thousands of dollars in government benefits, including food stamps, welfare and housing vouchers. The scheme fleeced U.S. taxpayers out of at least a quarter of a million dollars, according to federal prosecutors.

On the heels of “Tax Day,” 24 Internal Revenue Service (IRS) employees have been charged with stealing hundreds of thousands of dollars in government benefits, including food stamps, welfare and housing vouchers.

The story comes out of Tennessee, where federal prosecutors announced this month that the scheme fleeced U.S. taxpayers out of at least a quarter of a million dollars in government benefits. The corrupt IRS employees did it by making false statements to fraudulently obtain the benefits, which also included unemployment insurance.

In short, the IRS workers were “brazenly stealing from law-abiding American taxpayers,” according to the federal prosecutor handling the case. Better yet, Americans are not only paying their salary and generous government benefits while also getting fleeced for the other welfare the corrupt federal workers stole.

This case simply marks the latest of many shameful transgressions for the IRS in the past few years alone. The agency has repeatedly come under fire for failing to crack down on a number of fraudulent schemes, including prison inmates that illegally receive tens of millions of dollars in tax refunds, federal employees at various agencies that have escaped paying billions in back taxes and letting illegal immigrants get billions in tax refunds.

The jailbird tax scam has become a big joke because the IRS has for years failed to stop the fleecing by incarcerated criminals. In fact, the number of fraudulent tax returns filed by prisoners—and the money doled out by the government—increases every year, several federal audits have found. Earlier this year one such audit revealed that from 2004 to 2010 the number of inmates that swindled the government increased from 18,000 to over 91,000 and the refunds claimed skyrocketed from $68 million to $757 million.

A few years earlier a separate federal probe determined that more than a quarter of a million inmates filed tax returns with the IRS and nearly 50,000 claimed more than $130 million in refunds without bothering to report wage information. That particular investigation also disclosed that the IRS has never bothered to create a system to catch the offenders, despite an ongoing epidemic of inmates—in both federal and state prisons—illegally receiving millions of dollars in tax refunds each year.

As if that weren’t bad enough, the IRS has also permitted more than 1 million foreigners—many in the country illegally—to claim tax credits they didn’t qualify for, which ended up costing the government an astounding $9 billion. The agency knew the tax credits were not legal because filers didn’t possess a valid Social Security number, but rather an alternative Tax Identification Number (TIN) popular among illegal aliens but not valid to work in the U.S.

There have been a number of other scandals at the IRS over the years, including a $33 million giveaway for bogus electric car credits and a high-level agency director who admitted defrauding the U.S. government out of $1.3 million using fake deductions to reduce the taxes of unsuspecting Americans. Last spring Judicial Watch obtained records showing how the IRS uses taxpayer confidentiality laws to withhold records of employee fraud.

While law-abiding citizens get slammed with higher taxes, incarcerated criminals who prepare fraudulent returns are getting tens of millions of dollars from the Internal Revenue Service (IRS) and the agency is doing little to stop the hemorrhaging.

It gets better; the number of fraudulent tax returns filed by prisoners—and the money doled out by the government—goes up every year because the IRS can’t seem to find an effective way to crack down on the scheme! From 2004 to 2010 the number of inmates that swindled the government increased from 18,000 to over 91,000 and the refunds claimed skyrocketed from $68 million to $757 million. The IRS pats itself on the back for blocking $722 million in tax refunds to inmates during 2010, but it still handed out more than $35 million.

While this may seem unfathomable to many, it’s all documented in a scathing federal audit released recently by the Treasury Inspector General for Tax Administration. Here is an understatement, as per the agency watchdog: “Refund fraud committed by prisoners remains a significant problem for tax administration.” Here is another one, included in the report; “controls used to ensure the IRS identifies fraudulent refunds on tax returns prepared by prisoners are not fully effective.”  

No kidding! Now that we got those enlightening assessments out of the way, let’s look at some of the reasons why this is happening. Parts of the report—including entire pages—were redacted to comply with “federal confidentiality laws,” but the bottom line seems to be finger pointing between the IRS and the Federal Bureau of Prisons and the State Departments of Corrections.

The IRS defends its incompetency by claiming that it does not have the authority to contact jail officials about prisoner-filed fraudulent tax returns because the information is confidential. When the IRS identifies records that don’t match those provided by the Social Security Administration its hands are tied. That’s because it doesn’t have the authority to resolve the discrepancies since it would violate an IRS code that specifically states tax returns and all associated information shall be confidential.

Furthermore, the IRS asserts that prisons don’t always provide it with accurate information or complete records and that not all facilities report inmates. This makes it impossible to adequately control the corruption because the agency must rely on information provided by prisons to identify inmate-filed tax returns. Nonetheless, the inspector general says, the IRS can do a better job of ensuring the files are accurate and complete by taking further steps to improve the validation and verification processes.

This is not the first time that the IRS gets slammed for doling out money to incarcerated criminals who are not entitled to it. For more than a decade, government investigators have exposed an epidemic of prison inmates illegally receiving tens of millions of dollars in tax refunds. Just a few years ago a federal audit revealed that more than a quarter of a million inmates filed tax returns with the IRS and nearly 50,000 claimed more than $130 million in refunds without bothering to report wage information  

Weeks after a government audit revealed that the Internal Revenue Service doled out $33 million in fraudulent electric-car tax credits, a separate probe says the agency paid out over half a billion dollars to “homebuyers” who didn’t qualify.It’s simply the latest of many blunders for the perpetually troubled government agency that’s awarded prison inmates tens of millions of dollars in bogus tax refunds in the past decade. Last year alone, more than a quarter of a million prisoners filed tax returns with the IRS and nearly 50,000 claimed more than $130 million in refunds without bothering to report wage information, according to the Treasury Inspector General.Last month the Treasury IG, the IRS’s watchdog, found that the Obama Administration’s aggressive push to reward consumers who buy costly “advanced-technology” vehicles resulted in rampant corruption because claims were automatically granted without scrutiny. In many cases the lucrative tax credit—worth up to $7,500—was awarded to gas-guzzling sports utility vehicles and even a bicycle. Some people got multiple tax cuts for the same vehicle and dozens of prisoners received nearly $50,000 in alternative vehicle credits even though they were behind bars.This month’s audit du jour says the IRS has dished out more than $513 million in credits to unscrupulous filers who claimed first-time homebuyer exemptions of up to $8,000 as part of Obama’s disastrous stimulus plan. A chunk of the money—about $326 million—went to nearly 50,000 people who already owned a home, the Treasury IG found. Nearly $8 million in credits went to more than 1,000 prison inmates and about $98 million to 13,400 taxpayers who never even bought homes.Even some IRS employees who didn’t qualify for the first-time homebuyer refund received it. In its report, the Treasury IG makes a rather simple suggestion that’s perhaps too common sense for the IRS; require taxpayers to provide documentation to support eligibility for all refundable tax credits. Here’s another good recommendation from the agency’s watchdog; that the IRS deny refundable credits when supporting documentation is not provided.

Nearly a year after Congress passed a law to stop incarcerated criminals from fraudulently receiving millions of dollars in tax returns, the Internal Revenue Service (IRS) hasn’t bothered creating a system to catch the offenders.For more than a decade, government investigators have exposed an epidemic of prison inmates illegally receiving tens of millions of dollars in tax refunds. Last year alone, more than a quarter of a million prisoners filed tax returns with the IRS and nearly 50,000 claimed more than $130 million in refunds without bothering to report wage information, according to the Treasury Inspector General.To tackle the problem, last summer Congress expanded a 2008 law (Inmate Tax Fraud Prevention Act) aimed at federal prisoners to include those in state facilities, where the swindling is also pervasive. The measure gives the IRS authority to disclose information on inmates who file a false tax return to the federal and state agencies that run prisons.More than eight months later the IRS has yet to reach an information-sharing agreement that will help state prison officials identify those who file fake tax returns, according to a U.S. Senator from Florida, the state with the highest number of incarcerated tax scofflaws.Nearly 20% of the all the fraudulent tax refunds received by prisoners nationwide go to Florida, according to the Treasury Inspector General. In 2009 around 9,000 incarcerated criminals in the Sunshine State filed fraudulent tax returns by using basic forms to claim phony credits, usually with no supporting documents. Many Americans may wonder why the feds aren’t being more aggressive in combating the crisis which annually cheats the government out of millions.Florida Senator Bill Nelson is wondering the same thing. In a letter to IRS Commissioner Douglas Shulman, the veteran Democratic lawmaker urges the agency to quickly reach an agreement with the state’s department of corrections to facilitate the sharing of inmate tax information. That way they can begin identifying and take action against those who file fraudulent returns.The request seems simple enough. After all, government audits have long exposed the perpetual problem over the years and the IRS has failed to act. As far back as 2005 the Treasury watchdog ordered the IRS to stop the millions of dollars in fraudulent refunds paid to prisoners. That year a probe determined that refund fraud committed by prisoners increased at an alarming rate of 318% from the previous year and that the crisis had been well-documented for a decade.

As if government wasn’t bloated enough, the Internal Revenue Service (IRS) will hire more than 1,000 new employees to monitor the implementation of Obamacare and the agency will spend an extra $93 million just to promote compliance in the first year.That’s because Obama’s hostile takeover of the nation’s healthcare system has created a “major challenge” for the IRS and the “largest set of tax law changes in more than 20 years.” At least that’s how the agency is justifying the costly additions in its 2012 budget request to Congress.The healthcare law will require additional resources to, among other things, build new information technology systems, modify existing tax processing systems and provide taxpayer outreach and assistance, according to the IRS budget request. There will also be other expenses for things such as resolving taxpayer “issues” in a timely and accurate manner and conducting “focused examinations to encourage compliance.”If this seems a bit murky, the detailed budget request provides some examples of what some of these things mean. For instance, the agency needs $34.4 million to hire 100 full-time staffers that will perform “new health coverage information reporting” and $22.2 million so that 150 employees can assist taxpayers in understanding the new provisions. It seems that these new divisions fall under taxpayer outreach or perhaps the innovative issue resolution department.A staff of around 84 will be hired at a cost of $9.9 million to “strengthen oversight of exempt hospitals” and $11.5 million will help create a tanning salon taskforce with 81 employees. Under Obamacare indoor tanning businesses must pay a 10% excise tax and the new division will assure that 25,000 facilities around the nation are complying. These appear to fall under “focused examinations to encourage compliance,” though it’s hard to say.The IRS also needs to hire more than 200 new agents to handle other tax law changes related to Obama’s catastrophic $787 billion stimulus, according to its budget request. As for Obamacare compliance requests, they can expect to grow since the law won’t even be fully implemented for several more years.

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