Owe The IRS? No Problem!

Contributor Lloyd Garver Says the Tax Agency Seems To Be Rewarding Its Worst Customers

(CBS)  "If you owe the IRS lots of money, forget about it. We'll take care of it. We'll get them off your back. You won't have to pay all of what you owe. So, why should you pay what you really owe when our expert former IRS agents can negotiate a low settlement for you?"

The above is a paraphrase of the many commercials that I've been seeing on television lately. The premise is that through no fault of your own, you have failed to pay the taxes that you owe, and the mean and nasty IRS wants its money. There is no reason for you to despair, because there are companies who can help you negotiate a settlement with the government.

Online, you can see even more explicit ads:
"Ex-IRS Agents Solve IRS Problems Up To 99 percent Off Tax Debt."
"How To Settle With The IRS For Pennies On The Dollar."
"Average Savings of 90% On Taxes"
The people behind that last ad don't stand a chance. Why would I want to save only 90 percent on my taxes, if somebody else can save me 99 percent? They're actually advertising that some people can pay only 1 percent of what they owe. Do you think the place where you bought your car would make that kind of deal? Or how about the bank that holds the mortgage on your house? Somehow, I don't think if you gave them a check for 1 percent of what you owe, they'd say, "Congratulations! The house is yours now." So why is our government doing it?

I understand that people can get in financial trouble and have difficulty paying the taxes that they owe. I also understand the IRS working out a payment plan with these people so they can pay their taxes without ruining their lives. What I don't understand is why the government negotiates "settlements." Shouldn't people have to pay 100 percent of what they owe eventually?

Why should those of us - often with some difficulty and usually with some anger or, alas, sadness - have to pay 100 percent of what we owe, but those who have failed to meet their tax obligations get to pay less than what they owe? Again, I'm not talking about the family whose house burns down or whose breadwinner suddenly and tragically dies, leaving the family in financial chaos. I'm talking about people who just don't budget well, spend more than they earn, or simply have the attitude of, "Why should I pay taxes? What's the government done for me lately?" Why is the IRS rewarding people who are financially irresponsible?

The "forgiveness" that the government offers to some people is not necessarily a terrible concept. It's just applied to the wrong people. If you're going to give it, give it to those who went through Katrina or are victims of the current fires in California, or to those who have been fighting in Iraq, not to those who just feel that paying taxes isn't a high priority for them.

Or if the government is really intent on having a "sale" in which they mark down what they're charging people, shouldn't they be offering this discount to its good and loyal customers? Give a little break to those of us who pay our taxes every year. Why not? Some stores offer discounts and special sales to their good customers. And who's the owner of the corner drugstore more likely to take a few cents off an item for: the customer who always pays on time, or someone who hasn't paid for those glow-in-the-dark condoms for six months?

Just to be clear, it's the IRS that I'm blaming. I don't blame the people who want to pay as little as possible. We all would like to pay as little as possible. And I don't blame the companies who offer this service. I'm sure they are legitimate businesses.

However, I did see something surprising when I went online to check out one of these companies' Web sites. I'm no expert in advertising or marketing, but I just don't think I would've chosen the celebrity spokesperson that they picked. It's former baseball great Pete Rose. I'm not kidding. In case you're not familiar with Pete's tragic story, he spent five months in jail in 1990 for tax evasion.

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Lloyd Garver has written for many television shows, ranging from "Sesame Street" to "Family Ties" to "Frasier." He has also read many books, some of them rather taxing.

[jon_mccain]

The reason the IRS is willing to settle is their priority has been changed from upper income to mid and low level taxpayers who don''t have large amounts of cash and assets lying around.

In 2006 Bush and the Republican Congress, unable to eliminate the estate tax, cut funding to the IRS. The IRS said they would in turn have to lay off almost half of their estate attorneys that generate about $2200 each for every hour worked.

Conversely, taxpayers reporting less than $25,000 in income were six times more likely to undergo IRS audits in 2005 than those reporting earnings of $200,000 or more, according to the public-interest group Transactional Records Access Clearinghouse, affiliated with Syracuse University

[eggy1620]

jon_mccain. . . the reason why $25K earners are six times as likely to be audited than $200K earners is because there are at least six times as many $25K earners as there are $200K earners. Simple statistics determines your likelihood of being audited. Not some vast right wing conspiracy

[bthrasher102]

I think the author should have done more research than just watching the commercials. Most of these are scams in which people pay a fee to the company and then find out that they don''t qualify for the IRS program. I guess it''s just typical journalism, see something that looks like abuse, do no research, and present it in a way that makes it look as bad as possible. Also, where the hell did jon_mccain find that under 25K taxpayers were 6 times more likely to be audited. I looked at the website and the following is all I could find: http://trac.syr.edu/tracirs/highlights/current/ratesTab3.html

[davidlar2]

To Joshdestardi:
Let''s face up to the point that the votes and popular support are just not there for the progressive agenda. Perhaps people listen to right wing talk radio because they agree with it rather than the other way around. Otherwise, progressive radio might have been just as successful. I''m tired of the progressive insistence that anyone who thinks would be a progressive and anyone who is not a progressive is just not thinking and being led.

And for the record, I''m a libertarian who is equally frustrated with the christian right and progressive agendas. And I haven''t been led to this position by the great libertarian conspiracy that is keeping me from adopting progressive opinions.

[gunownerdan]

It would be nice if the IRS would show us the law to prove that they have a right to tax our income in the first place...

[thgdriver]

Strange, you never hear any one running for office that states that he/she is going to bust the IRS, put them out of business or is going to investigate the IRS when elected. Hummmmmmmmmmmm I wonder why? LOL!

[bthrasher102]

AMENDMENT XVI

Passed by Congress July 2, 1909. Ratified February 3, 1913.

Note: Article I, section 9, of the Constitution was modified by amendment 16.

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

[drivelphobe]

The IRS needs to audit every foreigner in this country. The middle-easterners are crooks and lie about everything. They seem to be obsessed with money and will steal from their mothers if it means getting ahead.

Hire more investigators. They are the backbone of America and we need much more enforcement. No negotiations. Collect it all with penalties, or send the violators to jail.

[eggy1620]

National Sales tax would stop most of the complaining about the poor versus rich tax burden. Eliminate the income tax and tax consumption. You earn $500K per year? Fine it%u2019s all yours. But if you want to spend it and flaunt it, you%u2019re gonna pay thru the nose. A sales tax could be progressive as well. For every thousand dollars above the regional median you pay for your house, you%u2019ll pay a higher tax. Same could apply to cars, clothes, energy, etc.

[bthrasher102]

That sounds great, but what do you do with tax credits such as the EIC which sometimes pay back a taxpayer up to 5K? Under your system they would pay tax and not get any back. Also, most of the time anyone who is poor has to spend everything they make. Under a sales tax, they would be taxed on all income. The rich, on the other hand, would only be taxed on what they spend, which is a smaller percentage of their total earnings. What do you do about kids? Charge them national sales (income) tax every time they purchase a pack of gum? don''t get me wrong, I live well within my means and would love a sales tax since I''m not rich. I just don''t see how you get a sales tax to really work well.

[phil-in-fin]

Disturbingly, drivelphobe said,

"The IRS needs to audit every foreigner in this country. The middle-easterners are crooks and lie about everything. They seem to be obsessed with money and will steal from their mothers if it means getting ahead.

Hire more investigators. They are the backbone of America and we need much more enforcement. No negotiations. Collect it all with penalties, or send the violators to jail."

To this next question, drivelphobe, please say "No."

Do you own a gun?

[guysdigdirt]

I know a one man, makes around $1,200,000 a year, take home. Has a business and writes everything off, claims around $20,000 a year in income. Do you think they should audit him?

YOu say you are 6 times more likely to be audited if you make $25,000 a year than $200,000 a year? Could that be because there are 12 times more people making $25,000 a year than $200,000 a year? Seems your odds are better if you only make $25,000 a year.

It is all the spin that is put on the stats, you can make anything look the way you want it to.

Get an eduaction, then pop off.

[guysdigdirt]

drivelphobe,

I love the fact you throw political correctness out the window.

I do not like your way of thinking with the blanket statement, but never let PC get in your way.

[incog-nito]

Replace the income tax with a sales tax. No more IRS, no more accountants, no more tax returns, no more audits, no more waste.

[incog-nito]

Replace the income tax with a sales tax. No more loopholes, no more tax shelters, no more special interest tax credits, no more social engineering, no more class warfare.

[juwboy]

incog-nito said:

Replace the income tax with a sales tax. No more loopholes, no more tax shelters, no more special interest tax credits, no more social engineering, no more class warfare.

IT''LL NEVER HAPPEN.

Why?

Because thousands of IRS employees will lose their jobs. In order to protect themselves they always take action to ensure that taxes remain complicated.

Any Congressman who makes tax simplification proposals is immediately threatened with an IRS audit. They''re all tax-evading crooks with something to hide so the propsals are always "inexplicably" withdrawn.

For the IRS and all of us, it becomes a question of whether we want to destroy lives by aggressive collection which often drives people into not reporting income and going under the radar or by allowing them to pay what they can rather than pay nothing at all. There are ramifications on all sides of this question and I''ve never heard that the IRS makes it easy on people as these ads suggest...their hype is dishonest and misleading.

[gunownerdan]

Vote for Dr. Ron Paul and he will work to ABOLISH the IRS ONCE AND FOR ALL!
ronpaul2008.com

[horse3farm]

The IRS doesn''t audit based on income. It has a series of "flags" that trigger an audit. But it''s still illegal because there is no law saying we have to pay income taxes.

National sales tax is the way to go. But yes, all the IRS employees would lose their jobs. The same reason there will never by a cure for cancer....hundreds of thousands of dollars would be lost and all those people wouldn''t have jobs.

Stupid world

[eggy1620]

bthrasher102. . . We could still have returns to file so that low earners could still get refunds, etc. under much more simple rules. A national sales tax would ensure that people automatically pay up front the taxes they owe so the IRS does not have to waste resources going after them. You pay as you spend.

[bthrasher102]

Once again for anyone who thinks Congress lacks the power to tax us:

AMENDMENT XVI

Passed by Congress July 2, 1909. Ratified February 3, 1913.

Note: Article I, section 9, of the Constitution was modified by amendment 16.

The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

[frb01]

Flat tax or sales tax should have been done a long time ago. We would eliminate a whole bunch of jobs in the bureaucracy and a whole bunch of jobs for tax accountants and tax attorneys. And a bunch of court costs for enforcement. Makes sense to me.

[bthrasher102]

Eliminate jobs, now that''s something politicians will be lining up to get behind.

[cornflower3]

you can''t believe those claims. i paid $1,500 to an attorney to send in papers to negotiate with irs. irs said no. i''m out the money i paid to attorney. the only good thing is irs leaves me alone now because they know i''m too poor to pay them. it just means they won''t leave me alone until i die. i wanted to move into a trailer and pay $135 mortgage. i was turned down because of lien by irs. now i''m living in $850 month apt and can''t move because i have no escrow or moving money and am handicapped and can''t even pack myself. if they had let me buy the trailer when i wanted, the trailer and my debt would have been paid off.