Low to Moderate Income Hispanics Squeezed

irsBy Raoul Lowery Contreras

Americans – 59% of them — tell Fox News pollsters that the Internal Revenue Service’s (IRS) behavior which President Obama labeled as potentially “outrageous” is a “serious” problem.

This, after the Treasury Department Inspector General (IG) reported that the IRS had committed serious breaches of policy when dealing with conservative groups seeking tax-exempt status.

Congressional committees have now tracked the unethical if not illegal behavior from what originally was described as a couple of “rogue agents” in Cincinnati to the Presidentially-appointed office of the Treasury General Counsel.

Rather than cooperate, at least one senior IRS lawyer, the one in charge of tax-exempt certification, has taken the 5th Amendment protection to not testify to potentially criminal behavior in her official capacity.

The House committees have uncovered more problems and potentially criminal behavior at the IRS that will be sorted out in time but there more to worry about in what the IRS is trying to do, specifically affecting Hispanics.

It is no secret that Hispanics have proportionately more low and moderate income earners than Non-Hispanic whites and Blacks do. So it stands to reason that Hispanics must be wary of new proposals at the IRS they call “Simple Return” or “Return Free” or a “Real Time Tax System.”

That would be a throwback to what used to happen in the military when it has “Summary Courts Martial” in which one officer would hear the case as prosecutor, judge and jury. In this case a computer would fill out income tax forms for low  to moderate income earners for “free” and determine how much the “client” would pay in taxes. By the way, the United States Supreme Court ruled “Summary Courts Martial” unconstitutional and erased them from the records of thousands of men and women who had suffered through this highly suspect system Congress allowed for decades.  So why would we want a computer to do what the courts have already ruled is unconstitutional when humans do it?

Some Senators of the “tax, tax, tax” persuasion believe this “free” system is a way of increasing revenue without having to vote for tax increases.  Others suggest that this would amount to “tax simplification,” really these two schools of thought have wormed their way into the Senate and House Finance Committees.

Hispanics, as we have seen would be affected negatively to the extent of potentially billions of “new” dollars in taxes calculated by the IRS ruthlessly efficient computers.

Outrageous! How can any thinking Senator or Representative think that this proposed IRS program has any merit whatsoever? Certainly there can be no “demand” from the community for this “free service.”

Any low-to-moderate income American Hispanic can file his/her federal tax return online for free.

Sixteen major corporations currently offer absolutely cost free tax filing services and free forms anyone can fill out online to all (100%) of taxpayers.  Many community based organizations including local La Raza affiliates hold tax workshops to get help and advice on how to prepare and file their income taxes.

It should be remembered that few Hispanics pay income tax on low-to-moderate incomes to begin with. That is especially true if there are dependents. Of particular interest to these people is the Earned Income Credit championed by Ronald Reagan. Will IRS agents treat that benefit with objectivity as it would cost the government money?

Moreover, the General Accounting Office (GAO) studies expose multi-million – billion – dollar mistakes made by IRS employees. They do not and cannot give out accurate information on their 800-information lines, or online.

Refunds are denied by mistake, delayed by mistake and the IRS does not respond well to taxpayer complaints about their refunds. Criminal fraud permeates the entire IRS revenue gathering. The IRS hammers innocent people every day causing millions of man hours and dollars to be wasted while IRS officials take the 5th Amendment.

Congressionally approved tax preparation and collection would be a conflict of interest that the “client” would be potentially damaged by; it might even be a crime.

Hiring of up to 2,000 IRS agents to implement this program would cost billions in payroll and future retirement. On top of that, the IRS must hire up to 16,000 new agents to implement the Affordable Health Care program (Obamacare).

How many more billions of dollars will the government have to borrow from foreigners to finance this gigantic increase in IRS agents? It might be that the Obamacare hiring is baked into the future but there is no need for tax preparer/collectors to troll through the Hispanic community in search of more revenue.

Why? Because there are plenty of free tax preparation and filing programs available online from community-minded private corporations and through community organizations.

Leave a Reply

Your email address will not be published. Required fields are marked *