The Chairman’s Report April 15, 2022

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  • Source: FAIRtax
  • 04/15/2022

The Creation of the IRS

This Should Be The last April 15th Tax filing Day We Have To Endure!

 

Governments have always needed funds.  To collect these funds, they have sometimes employed tax collectors who were paid by being allowed to retain a portion of what they collected.  Of course, these tax collectors often used very brutal methods and there were many protests and even revolts.
 
In more “civilized times”, governments set up departments operated by the government to collect the imposed taxes.  
 
In 1862, President Lincoln signed into law a bill that levied a three percent tax on incomes between $600 and $10,000 and a five percent tax on incomes of more than $10,000. To collect this new income tax, the law created a Commissioner of Internal Revenue.
 
After the passage of the 16th Amendment in 1913, Congress adopted a one percent tax on net personal income of more than $3,000 with a surtax of 6 percent on incomes of more than $500,000.  The first Form 1040 was created for citizens to complete and determine their income tax.

Of course, the low rates didn’t last long, and the Revenue Act of 1918 imposed a progressive income-tax rate structure of up to 77 percent.

In 1953, the Bureau of Internal Revenue was renamed the Internal Revenue Service (IRS).
 

The IRS Has Become Like The Old Cell Phone

 
Many of us remember the old cell phones pictured above. They were heavy and had terrible battery life.  But we marveled at them because they were able to make and receive telephone calls while we drove or walked in the park.
 
Contrast these early “dumb” phones with the “smart” phones that we now have. The “smart” phones are much more powerful than the computers that were used by NASA to take Neil Armstrong and Buzz Aldrin to the moon in 1969.
 
They are lighter and have great battery life.  You can make phone calls, but you can also send and receive text messages and surf the internet.  You can pay bills and make purchases.  If someone has a question about anything it is common to see someone type in the question on their “smart” phone and provide the answer.
 
Some people find that their “smart” phone replaces any need for a computer.
 
Like the early “dumb” cell phones, the IRS functioned adequately for a number of years because their job was straightforward—to collect the taxes owed from taxpayers because most people voluntarily paid their income taxes.   There was evasion but it was much less than today.
 
One reason that the IRS has become increasingly ineffective, evasion of taxes lawfully owed is over $1 trillion per year and growing, is they are still trying to use technology that is the equivalent of a “dumb” phone.  They can accept returns and process them.  However, income tax evaders don’t identify themselves on their tax returns.  In order to help find them, it is necessary for the IRS to properly analyze the increasing amount of 1099’s and other reports along with other income tax returns of similar people.
 
A second reason is that the Internal Revenue Code has become much more complex and the job of the IRS is no longer just charged with collecting income taxes.  As the article below points out, they are increasingly responsible for administering social programs.  
 
Chaotic IRS Filing Season Shows the Perils of Running Social Policy Through the Tax Code is the title of an article published by the Tax Foundation. The article points out:
 
  • As of January 28th, the Internal Revenue Service (IRS) had 23.7 million returns awaiting action, compared to a typical backlog at that point of roughly 1 million returns.
  • By creating new tax credits in lieu of traditional welfare programs, expansions of the social safety net could be framed as tax cuts.
  • The Taxpayer Relief Act of 1997 included several reforms to the tax code, the most prominent being the creation of the Child Tax Credit (or CTC).
  • The CTC is only one of many tax credits added to the IRS’s responsibility including health care (e.g., the Affordable Care Act’s Premium Tax Credit), education, housing, energy, and the environment.
  • As the responsibilities of the IRS grew, the political will to raise its budget weakened.
  • The IRS received 195 million calls in the 2021 filing season, relative to just 36 million in the 2019 filing season.
  • The IRS is authorized to hire 10,000 more agents but has not been successful filling these positions.
 
One of the ways that the IRS has responded to its increased duties is to not audit the wealthy but the nation’s lowest income earners.
 
Nearly Half Of IRS Audits Target Poorest Taxpayers, Report Finds is the title of an article that appeared at the DailyWire.com.  Here are some points made in the article:
  • Nearly half of all IRS audits in 2021 targeted the nation’s poorest taxpayers, according to a new study.
  • A report released by the Transactional Records Access Clearinghouse (TRAC) on Tuesday said that about 307,000 of the nearly 660,000 audits conducted by the IRS in 2021 were among taxpayers who claimed the Earned Income Tax Credit intended for those making the lowest incomes in the nation, those earning less than $25,000 in total gross receipts.
  • The poorest families in the study were audited at five times the rate of other Americans.
  • In 2021, Americans with total positive income $200k to $1M were audited at the rate of 4.5 out of every 1,000.
  • Americans with less than $25,000 in total gross receipts were audited at a rate of 13.0 out of every 1,000.
  • Of the 617,505 millionaire returns filed in 2021, only 13,725 millionaire audits were conducted.
  • Wealthy taxpayers can get good counsel and fight IRS assessments, but low-income taxpayers are far more likely to pay a fine and do as they are told.
 
The IRS has told Congress exactly what is needed for it to operate more efficiently and reduce evasion.  The IRS wants Congress to appropriate sufficient funds to allow it to:
 
  • Modernize its computer system, make their “dumb” phones into “smart” phones. 
  • Have Congress allow the upgraded computers access to all of our bank accounts and other financial information.
  • Hire tens of thousands of new employees to aggressively audit more and more taxpayers.
  • Not listen to the screams from outraged taxpayers.

Conclusion

No one likes tax collectors.  However, we all know that they are merely the tools selected by governments to enforce levies made by governments.  They can only do what the politicians allow.
 
The D.C. elite and their minions in Congress have created:
 
  • An incomprehensible tax system that is unfair to everyone except the people who pay the politicians for special treatment.
  • A demand that the IRS collect more taxes but look the other way if the methods are abusive to taxpayers.
  • A tax system that requires much more extensive intrusion into our financial affairs including total access to our bank accounts and how much is paid and received and to whom.
  • A tax system that costs Americans jobs and sends those jobs overseas.
When the income tax is criticized, the D.C. elite and their minions in Congress have acted like the little boy who is punished by his mother for taking a cookie from a jar who says, “My hand made me do it.”  
 
They tell us that none of the pain and economic woes that are visited on us are their fault.  They blame the IRS.
 
Of course, this is not true, but it doesn’t stop the D.C. elite and their minions in Congress from spreading their lies and seeking to deflect any responsibility for their actions to the people who work at the IRS, trying to enforce their laws and follow their instructions.

The income/payroll tax system is broken and no longer working—we can’t repair it but we can replace it with the FAIRTAX!
 

Join us and TAKE BACK CONTROL OF OUR COUNTRY—NOT WITH BULLETS BUT WITH THE ELIMINATION OF ONE OF THE BIGGEST THREATS TO OUR LIBERTY AND ECONOMIC PROSPERITY—THE INCOME/PAYROLL TAX.

We all should remember Edmund Burke’s warning that applies to our efforts to TAKE BACK CONTROL,
 
“Nobody made a greater mistake than he who did nothing because he could do only a little.”

We should also remember this quote from George Orwell's 1984, which, if we do nothing, may foretell your and your children's future:

“If you want a picture of the future, imagine a boot stamping on a human face—forever.”


WHAT CAN EACH OF US DO? 

We can write letters and make calls to our elected representatives and attend Zoom town hall meetings demanding that if they really want to allow Americans to “TAKE BACK CONTROL”, the first step is to eliminate the income/payroll tax system and enact the FAIRTAX!

If you want to prevent the IRS from being further weaponized to punish those of us who may object to the D.C. opinions and dictates of what is good for us, then help us PASS THE FAIRTAX!

The IRS will be gone and we will pay our taxes when we make purchases.  WE and not D.C. Elites will decide how much federal tax we pay!

If you have friends who don’t know about the FAIRtax, send them to FAIRtax.org.  Have them watch the white boards under “How It Works” and, if they agree, ask them to please join us.

Then contact your Members of Congress and the President and demand that Congress pass -the FAIRtax—the only fair tax

Remember, if we don't continue to tell the truth and demand a change, then this quote from George Orwell's 1984 may foretell our children's future:

“If you want a picture of the future, imagine a boot stamping on a human face—forever.”

Is it hopeless?  When confronted with a seemingly impossible problem, remember the statement attributed to the author George Bernard Shaw who wrote, You see things; and you say “Why?”  But I dream things that never were; and I say “Why not?”

Isn’t it time for us to ask, “Why not?”

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cell phone by Photology75 is licensed under Envato Elements Envato Elements

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