DEAR ANN LANDERS:
You certainly went easy on the Internal Revenue Service in your recent reply to "Los Angeles Taxpayer." Maybe you were just being prudent. Because frankly, Ann, if your gentle words about the IRS were sincere, you need a reality check on just how incompetent and abusive Uncle Sam's tax agency really is.
"Los Angeles Taxpayer" wrote to you with a tale of red-tape madness. It began in March 1995, when he mailed his tax return with a check to the IRS. Soon afterward, he was told the check had not been received and was advised to put a stop-payment on it. After he did so, the IRS found the check, tried to deposit it, and then sent it back—stamped "payment stopped." When he sent a replacement check, the IRS applied it to the wrong tax year.
Meanwhile, the IRS mailed him a refund check, then mailed him a letter asking for the refund check back, then mailed him a Form 3911 to report the refund, and then mailed him a letter announcing that his "claim for a refund" would take nine more months to process. All the while, L.A. Taxpayer kept trying to tell the IRS that he wasn't owed a refund in the first place.
"Frankly," he wrote to you, "I'm afraid to send in my next tax check. They should change their initials from IRS to MESS."
In your column, you replied: "Considering the number of returns it processes and the mistakes people make when filing their returns, it's a miracle the IRS doesn't screw up more often."
Wake up and smell the java, Ann! The IRS does screw up more often. It screws up constantly. You should have told L.A. Taxpayer to be grateful that all he has to worry about is a nonexistent refund check. Screwups? How about the 3,000 people notified by the IRS in 1993 that they each owed $4 billion in back taxes? How about the Philadelphia chemical firm that was penalized nearly $47,000 because the IRS determined that its tax payment of $4,448,112.88 was a dime short? How about the 50,000 improper levies annually imposed on individuals and businesses?
The IRS recently spent $8 billion to overhaul its computer programs. What it got for all that money, a top official recently admitted, are systems that "do not work in the real world."
Ann, you have no idea how arbitrary and heavy-handed the IRS can be. The federal tax agency sends out some 30 million tax penalty notices every year. Nearly half are erroneous. As James Bovard observes in his chilling book Lost Rights: The Destruction of American Liberty, "The proliferation of tax penalties enables the IRS to threaten the average taxpayer with 'massive retaliation' for the slightest error -- yet IRS agents themselves are almost never punished for their errors . . . . If a private bill-collection agency sent out millions of unjustified demands for payment, it would almost certainly be prosecuted for attempted extortion."
As the tax deadline approaches each year, the IRS invites taxpayers to call its toll-free number with their questions. When they do, millions are given the wrong answer. Then when they rely on those wrong answers, they are slapped with interest, penalties, and liens on their property! If you had a track record like that, Ann, would anybody still trust your column?
The Heritage Foundation recently compiled nine pages of numbers underscoring IRS ineptitude. A few examples:
- Number of times the IRS gave the wrong answer in 1993 to taxpayers seeking assistance with their tax forms: 8.5 million.
- Percentage of its own budget for which the IRS could not account in an audit by the General Accounting Office: 64.
- Number of correction notices sent out by the IRS each year that turn out to be wrong: 5 million.
- Percentage of revenue returned when taxpayers challenge IRS penalties in court: 40.
- Number of women wrongly fined each year because they got divorced or remarried: 3 million.
- Number of taxpayers whose old age benefits will be cut because the IRS doesn't properly record their tax payments: 10 million.
As the Internal Revenue Code grows ever more dense and complex, it becomes easier for the IRS to find something wrong with any tax return. Every year, Money magazine asks 50 tax experts to calculate a hypothetical family's IRS bill. Every year, nearly every answer comes in wrong. If it's so simple to flummox the pros, imagine how easily Internal Revenue agents can ambush any taxpayer they decide to go after.
So take a few lashes with the wet noodle. Then add your voice to the cry for a simpler, slimmer, saner tax code. As the Midland, Michigan-based Mackinac Center for Public Policy says, "Since the federal income tax threatens to flatten us, it's time to think about how to flatten it."
Do it for your readers. Believe me, Ann, they need your help.
(Jeff Jacoby is a columnist for The Boston Globe).
June 22, 1997 update:
Ann Landers reprinted most of this column in her own syndicated column, and then replied: "Dear Jeff Jacoby: You've made a pretty solid case against the Internal Revenue Service and knocked some credible holes in what now appears to be my rather lame defense. I'm getting out the wet noodle in anticipation of 40 lashes."
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