IRS Collects $1B in Back Taxes from Millionaires

https://www.forbes.com/sites/andrewleahey/2024/07/11/irs-collects-1-billion-in-back-taxes-from-millionaires/

by tldrthelaw • 2 years ago

60 92 2 years ago

forbes.com

ddoolin2• 2 years ago

This is why Republicans are trying to defund the IRS.

exabrial• 2 years ago

The problem isn't tax revenue.

The problem is the federal government spends $1billion dollars every 1.46 hours.

We collect an _absurd_ amount of taxes. Far Far Far Far too much. The vast majority of it is wasted.

Collecting more isn't going to solve the problem and it never has.

halfmatthalfcat• 2 years ago

I personally don’t feel like my tax dollars are wasted, by and large. I also live in a large metro where I see my tax dollars being spent all over the place on worthwhile projects. Is every dollar spent as efficient as possible? No, but humans don’t operate at peak efficiently and never will.

mythrwy4• 2 years ago

The projects you see in the metro would probably be mostly from local (county/ city) taxes as opposed to federal taxes no? (I do realize the feds sometimes contribute partially).

Someone could probably make the same arguments for/against local taxes, but OP appeared to be referring to federal taxes as wasteful.

lotsoweiners2• 2 years ago

My guess is that you haven’t worked for the government. I’ve spent 20 years working for multiple government agencies and the one commonality is that they are all very wasteful. I’ve spent countless hours working on pet projects for some middle manager or executive who leaves three months later and the project gets scrapped. I’ve seen plenty of passionate developers, both employees and contractors, come in and leave after a year once they’ve understood that no one cares and that they will always be wading through bureaucratic sludge in order to get anything done.

yunohn• 2 years ago

The unspoken point being made here is about corruption, not efficiency per se. I want all my tax money going towards the public good, not just fractions/percentages of it.

selfmodruntime8• 2 years ago

820 billion dollars (and counting) are spent on war by the US government every year.

rangestransform2• 2 years ago

Even though I use publicly funded infrastructure every day (and I like it, too!), government spending inefficiency in the US is a problem, even compared to “western liberal democracies” as we would say in competitive debate

https://www.nytimes.com/2017/12/28/nyregion/new-york-subway-....

guywithahat• 2 years ago

It depends a lot on where you live. In CA they’re spending 100 billion dollars on 500 miles of high speed rail, while in Florida a private high speed rail project spanning 230 miles of rail cost 5 billion. It’s hard to imagine that extra ~85 billion is being well spent, especially given it will almost certainly go further over budget

Klonoar• 2 years ago

After paying taxes in other countries, and then seeing their standard of living, I think there’s probably more room between US tax spend and “peak efficiently” than your comment would lead someone to believe.

Qiu_Zhanxuan• 2 years ago

European talking but do you feel the proportion of tax being wasted has increased or decreased since the last 2 decades ? Did public service got better or worse ? Social program ? Education ? Foreign Policy ?

I always felt that America had low taxes and most of it was used to deliver the bare minimum services (police, defense, public servant, social program) or even below (public schools, teacher, justice, IRS...) what is necessary for a society to sustain itself.

blackeyeblitzar3• 2 years ago

I see tax wasting increasing. For example my local and state government spend lots of taxes on funding activist / social justice programs that are simply not wanted by most citizens but are still pushed through by dedicated extremist activists. These programs always have generic names and goals like “community building” and they achieve nothing, except handing out our hard earned money to politician’s friends (who they can count on for election support) and their political causes. Meanwhile basic government functions like policing and prosecution and education are failing.

Here’s one example among a LONG list of grifts that illustrates how reckless politically biased elected officials can be with everyone else’s money - spending millions so some activist group can run a minor survey: https://www.seattletimes.com/seattle-news/politics/seattle-s...

Another example: here, funding for public schools has increased a huge amount - it is more than double what it was a decade ago. Our schools spend something like 20-25K USD per student per year now. But the schools are in poor physical condition, the quality of education is low, programs like music are on the chopping block, many schools are being closed to save money, the teachers and their unions are unaccountable for performance, and the school/district leaders are focused on political battles like injecting ethnic studies into math (https://www.seattletimes.com/education-lab/new-course-outlin...).

The thing is government programs are generally not held to any standard of performance and accountability, and citizens don’t have much time to watch over them. Spending and budgets always go up not down, because there is always some dedicated group fighting to extract something for themselves. The leaders who are enabling all this act in ways that ensure election and re election, not good results for their citizens. And they act in favor of their personal political and ideological goals instead of being neutral. This type of “corruption” then causes many people to want to just reduce taxes because they’re not even getting the basics they thought they already pay for. I don’t have a solution, I just think it is some kind of spiral that leads to people believing taxes are wasted more as time goes on.

rangestransform2• 2 years ago

Increased for sure

https://www.nytimes.com/2017/12/28/nyregion/new-york-subway-....

Larrikin• 2 years ago

What is it wasted on specifically and what do you think taxes should be spent on specifically?

lotsoweiners2• 2 years ago

In my 20 years govt experience, it is wasted on pet projects and failed projects created by contractors.

mpalmer• 2 years ago

There is no "the" problem. You identify one problem to exclusion of the very real, salient problem that the average taxpayer sees the wealthy as not paying their fair share.

s1artibartfast11• 2 years ago

I wonder how that perception problem can be tackled?

The top 1% of people pay 45% of federal income taxes. The top 10% of people pay 75%.

Rates are already highly progressive.

https://taxfoundation.org/data/all/federal/latest-federal-in....

mythrwy4• 2 years ago

Here is the problem.

Even if you taxed "rich people" harder, say tax all billionaires at 90%, there isn't enough to cover what is being spent and it's not even close.

For instance, there is approximately 5 trillion currently held by billionaires in the US. That, coincidentally, is approximately 1 year of current federal spending.

Then the following year you have no more billionaires to harvest as it took them many decades to get the money.

On the other hand you have people who say "well, the federal government needs to stop spending so much" (and this does make sense at the same level "tax the rich more does "). But the problem with removing, or even substantially reducing, federal deficit spending is the resulting giant black hole would economically collapse many things in the short term at least.

I don't know that there are easy answers for the problems the US finds itself in at the moment. Probably some sort of financial reset at some point, which is unlikely to be either clean or painless.

nitwit005• 2 years ago

You don't actually believe revenue doesn't matter.

selfmodruntime8• 2 years ago

Revenue does matter only if spending has real consequences and if the income stream depends on how your business fares in the market. In this case, revenue is nearly unlimited, earned from an unwilling party without any requirements and there is zero oversight on how it's spent.

I think economics is a lot like physics, in a sense. Part of it breaks down when the powers that be become incredibly dense, heavy, and large.

janalsncm6• 2 years ago

This isn’t about increasing revenue. It’s about making people pay their fair share. Hard working people like us have to pay more in taxes to make up for tax cheats.

Tax cheats are basically stealing money from our pockets. So when the IRS comes for them I’m not going to be upset.

And I am sure these are people who would say they love America if you asked them. I bet. If you love America so much then pay your taxes.

oliwarner• 2 years ago

Why is that too much to spend? What's the right number? How would you achieve that?

I hold the opposite opinion. You don't have universal healthcare and who your parents were has a greater determination over your life than you will ever have. Those without rarely get the opportunities you and I ignore every day. You don't pay nearly enough tax for a first world country.

trealira• 2 years ago

If the revenue and spending of the US doesn't change, it will default on its debt within the next 20 years.

Under current policy, the United States has about 20 years for corrective action after which no amount of future tax increases or spending cuts could avoid the government defaulting on its debt whether explicitly or implicitly (i.e., debt monetization producing significant inflation). Unlike technical defaults where payments are merely delayed, this default would be much larger and would reverberate across the U.S. and world economies.

https://budgetmodel.wharton.upenn.edu/issues/2023/10/6/when-...

We need to reduce spending and increase taxes, but that's politically unpopular.

Ideally, when the economy is good, one should try to pay off the national debt, so that you can run a deficit when the economy is in recession. But the US just spent the last eight years running up incredible deficits; now, the debt needs to be reduced ASAP.

tonetegeatinst• 2 years ago

One interesting thing is that the us government can.leverage its national debt....or so it claims.....as this is why we are apparently not freaking out over the debt crisis. The government has learned to use debt as a measure of "progress" like sure technically every us citizen is responsible for that debt but when every vote gets to decide on a handful of people.... Millions could disagree with the representative and yet they still are responsible.

Like imagine if the average person could just decide they arnt going to be able to cover interest on the debt they have, yet they still could print tons of money. Money that's only backed by their word, and the debt gets used in your local town negotiations as a weapon.

mythrwy4• 2 years ago

The federal treasury also spent 140 billion paying just interest on the national debt in June alone (nearly 900 billion year to date).

So, this isn't even a drop in the bucket.

anon373839• 2 years ago

The cuts were couched as preventions against the IRS “targeting hardworking Americans”—but enforcement actions in general have focused on individuals making $400,000 or more

Is the assumption here that if one’s skills are worth $400k, one isn’t hardworking?

mylastattempt3• 2 years ago

It's all political rhetoric. Whenever you see wording like this ("hard working Americans", "blue collar" vs "white collar") your bs detector should start beeping. These are not factual and substantive discussion points, but political rhetoric to incite the masses. Divide, distract, and thanks for all the money while we keep doing the same as in the past few decades.

mylastattempt3• 2 years ago

This only affects the IRS's cashflow, it's a matter of collecting as the title states. No new policies or tax laws are responsible for this $1B. Just working harder or more focussed at collecting. A good thing, for sure, but not something new or newsworthy for HN if you ask me.

snotrockets2• 2 years ago

There is a new policy: the IRS was funded to allow investigating and collecting that. For years it was starved, just so it wouldn't be able to. The ROI in investing in the IRS is amazing.

mylastattempt3• 2 years ago

While I was aware that the IRS is begin systematically underfunded, you just helped me learn that this $1B was a direct result of a change in that funding/policy. Thanks for sharing!

IRS Collects $1B in Back Taxes from Millionaires

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