Exclusive: Obama Admin Kills Program That Helped Poor File Taxes, Sends Funding To Li

The President. Jobs for liberals through government grants program.

Exclusive: Obama Admin Kills Program That Helped Poor File Taxes, Sends Funding To Liberal Groups

10:01 PM 03/15/2015
RICHARD POLLOCK
Reporter


The Obama administration has quietly killed an IRS tax preparation program designed to help low-income and disadvantaged citizens, choosing instead to give millions of dollars to liberal groups for the same purpose.

Without fanfare, the administration has closed down the free walk-in services at hundreds of taxpayer assistance centers around the country.

Administration officials are now trying to steer the “face-to-face” help to volunteer community groups, some with political ties. But one undercover inspection of those groups in 2013 revealed a 49 percent error rate.

Enjoying bipartisan support, the tax centers had provided service to low-income and disabled citizens, rural dwellers and citizens not proficient in English. Workers earning $49,000 or less got free face-to-face help from IRS employees.

Funding was not an issue for the program. Unlike other parts of the IRS that faced cutbacks, the taxpayer assistance program was left untouched by Congress.

“In enacting the IRS’s budget for FY 2015, Congress spared the Taxpayer Services account from the reductions it made to other IRS accounts,” according to a 2014 annual report by the Taxpayer Advocate Service, a federal agency that represents taxpayers.

The report to Congress was titled, “Taxpayer Service Has Reached Unacceptably Low Levels and Is Getting Worse.”
Even so, according to the IRS, the administration abruptly ended the service in January 2014 without hearings, legislation or a public comment period.

Discontinuing the program has generated a storm of protest from taxpayer advocates who say the poor and disadvantaged are facing increasingly complicated tax burdens, but are getting less help from the Obama administration.

Many tax advocates say ending the service for the poor is the height of hypocrisy for an administration that claims to support the little guy.

“The thing is that this is an administration that pledges itself as trying to help out ordinary Americans, to help out the little guy,” observed Ryan Ellis, the tax policy director at the conservative Americans for Tax Reform.

“I wouldn’t think they would be shutting down an office whose very focus is to help those very people,” he said.

Daniel J. Pilla, a tax litigation consultant, says he considers the elimination of the program “outrageous.”

“We’ve got these people who make every effort to comply with the code. They look to the IRS for help and they’re not getting it,” he argued in an interview with TheDC.

“The decision to not provide the service was a deliberate decision that to me is outrageous,” he told TheDC.

Notably, the taxpayer advocate service of the IRS has condemned the elimination of the tax assistance program.

“[T]he government is largely turning its back on a significant number of taxpayers who require face-to-face assistance to comply with their tax obligations,” the advocate service stated in its 2014 annual report.

The agency added in the annual report that the Obama administration cancelled the program without a proper evaluation of its impact on low-income and disadvantaged people.

“The IRS discontinued tax preparation services at TACs without properly evaluating the limitations of the most vulnerable taxpayer populations – the elderly, low income, rural and those not proficient in English.”

Although they earn low wages, today’s low-income earners face a barrage of complex tax filings because they receive entitlement programs like the earned income tax credit that must be reported to the IRS.

And for the first time, low-income earners now face extra tax filing requirements if they received health-care subsidies under Obamacare. About 7 million tax filers are affected.

“Taxes are intimidating for everyone. I suspect they are especially intimidating for people with lower education levels or lower-income families,” said Elaine Maag, a senior research associate at the liberal Urban Institute, in an interview with TheDC.

The complexity demanded by Obamacare this year was so overwhelming, it caused IRS Commissioner John Koskinen to briefly consider the idea of delaying the tax season.

He lamented last October that this tax year was “the most complicated filing season before us in a long time, if ever.”
As a replacement for the taxpayer assistance centers, the Obama administration has funded community service groups with $12 million in matching grants.

The administration has asked the volunteer groups to perform the same service as those offered by the Tax Assistance Centers. But the staffers are volunteers, not tax professionals.

As it happens, some of the largest grants issued under this program — called the IRS Volunteer Income Tax Assistance program — have been awarded to groups that have political ties to the administration.

Since early in the administration’s first term, Obama officials sought to degrade the capabilities of the taxpayer assistance centers.

The U.S. Government Accountability Officer reported in December 2014 that between 2010 and 2013, the IRS continually reduced its field assistance staff to tax centers from 2,222 to 1,938.

“At the same time IRS eliminated return preparation at TACs, taxpayers increased their use of volunteer sites,” the GAO reported in the same report.

The IRS has attempted to makeup for the reduced service with an online program called “Free File.” But advocates retort that many low-income earners don’t even have access to the Internet.

http://dailycaller.com/2015/03/15/ex...iberal-groups/

FairTax now. Oh please, wake up. The income tax is a worthless tax that kills jobs, steals incomes and earnings, runs our companies out of the country to offshore locations, terrorizes Americans with filing responsibilities with the associated paperwork, documentation and records, hurts our environment with all the ink and paper needed to support this almost $14 billion a year agency function, to do what? Run an $18 trillion and growing national debt because there's no way Americans can or will pay enough income tax to support this government? Not for 102 years has the income tax generated enough revenue to pay the bills or maintain our economy. The income tax is today what it was when it was instituted by Democrats in 1913, a very bad game to line the pockets of a few at the expense of everyone else and a sick joke on the American People.

Stop this madness and pass the FairTax. How any member of Congress with all that it now knows about this tax system can refuse to terminate it and replace it with a consumption tax on new retail goods and services is just beyond me. You're supposed to be serious people, and serious people can't look at the income tax system with a straight face and keep from either laughing their asses off at the stupidity of Americans for putting up with it all these years or crying their hearts out over the damage it has caused to our nation and people much of it irreparable for those already adversely impacted by it. The FairTax stops the damage but of course can't correct the harm already caused, these generations of Americans will have to live with it, but future generations can be freed from it, and that's our responsibility to ourselves and our posterity to end the madness, stop the wrongs, and reset the course of this country on roads that lead to restored liberty and privacy and the increased incomes, earnings and prosperity that brings to all our people, businesses and nation as a whole.

HR 25 in the US House of Representatives and S 155 in the US Senate. If you're a member of Congress, actually do something today for your country and fill out the form to be a co-sponsor and walk it over to the Clerk's office. Yes, being an official sponsor makes a difference. It shows the record of who is committed to saving our nation and who isn't, probably the best test of our times.

Quote:

---

Originally Posted by Judy

FairTax now. Oh please, wake up. The income tax is a worthless tax that kills jobs, steals incomes and earnings, runs our companies out of the country to offshore locations, terrorizes Americans with filing responsibilities with the associated paperwork, documentation and records, hurts our environment with all the ink and paper needed to support this almost $14 billion a year agency function, to do what? Run an $18 trillion and growing national debt because there's no way Americans can or will pay enough income tax to support this government? Not for 102 years has the income tax generated enough revenue to pay the bills or maintain our economy. The income tax is today what it was when it was instituted by Democrats in 1913, a very bad game to line the pockets of a few at the expense of everyone else and a sick joke on the American People.

Stop this madness and pass the FairTax. How any member of Congress with all that it now knows about this tax system can refuse to terminate it and replace it with a consumption tax on new retail goods and services is just beyond me. You're supposed to be serious people, and serious people can't look at the income tax system with a straight face and keep from either laughing their asses off at the stupidity of Americans for putting up with it all these years or crying their hearts out over the damage it has caused to our nation and people much of it irreparable for those already adversely impacted by it. The FairTax stops the damage but of course can't correct the harm already caused, these generations of Americans will have to live with it, but future generations can be freed from it, and that's our responsibility to ourselves and our posterity to end the madness, stop the wrongs, and reset the course of this country on roads that lead to restored liberty and privacy and the increased incomes, earnings and prosperity that brings to all our people, businesses and nation as a whole.

HR 25 in the US House of Representatives and S 155 in the US Senate. If you're a member of Congress, actually do something today for your country and fill out the form to be a co-sponsor and walk it over to the Clerk's office. Yes, being an official sponsor makes a difference. It shows the record of who is committed to saving our nation and who isn't, probably the best test of our times.

---

Please spare us the constant advertisement for a plan that won't work as described no matter how you spin it!

Quote:

---

Originally Posted by Newmexican

As it happens, some of the largest grants issued under this program — called the IRS Volunteer Income Tax Assistance program — have been awarded to groups that have political ties to the administration.

---

And the 49% error rate mentioned earlier in the article is not a problem for someone who is essentially all about electioneering.
***********************************
Americans first in this magnificent country

American jobs for American workers

Fair trade, not free trade

Quote:

---

Originally Posted by MW

Please spare us the constant advertisement for a plan that won't work as described no matter how you spin it!

---

The FairTax works much like sales taxes work in 45 states. The FairTax works even better because it has a Rebate and allows people who want it to sign up for it to offset FairTaxes on the equivalent of spending on new goods and services up to the Household Consumption Allowance. It prohibits illegal aliens from the Rebate, so illegal aliens will be required to pay the tax but receive no rebate. This puts them at a rather significant economic disadvantage, and rightly so, and gets tax revenue out of them whereas the income tax rewards them for being here getting tax credits and refunds for tax they never paid.

Look at all this nonsense associated with the income tax. All this cost, all this work, all this manipulation, all this intrusion. Right now on the news are "tax pros" on the phone at a phone bank to help answer questions for tax filers. I'd say taxpayers, but we know most of them won't be, they'll be people filing tax returns who are on welfare and owe no tax. This is not liberty, this is not justice, this is a big income tax game on the American People, a tax game invented by Democrats to lower tariffs on imports and provide the mandated income to support the Federal Reserve, a socialist ploy to eventually turn our nation into a big joke with $18 trillion and growing in national debt, threats by Congress to cut Social Security and Medicare to balance the budget off the backs of retired senior citizens, 20 million manufacturing and related jobs lost that will never return until we eliminate the tax that drove them away, 20 million unemployed Americans, 70 million people on Medicaid, and a nation over-run with illegal aliens living better than at least 70 million Americans.

You want to hate on the FairTax, that's fine. That's your choice, MW. Mine is to love the FairTax and point out its merits especially those that relate to stopping illegal immigration and unfair trade and saving SS and Medicare for future generations.

Quote:

---

Originally Posted by MW

Please spare us the constant advertisement for a plan that won't work as described no matter how you spin it!

---

MW: Did you know that the "FAIR TAX" plan now in congress actually cuts the tax on rich people with children and raises the tax on poor people with children? Time for some spin?

Quote:

---

The "Economic Growth and Family Fair Tax" plan from Senators Rubio and Lee is ambitious and expensive, but it may hurt many low-income families with children, according to new estimates.

---

http://www.alipac.us/f19/family-fair...milies-318323/

Quote:

---

Originally Posted by JohnDoe2

MW: Did you know that the "FAIR TAX" plan now in congress actually cuts the tax on rich people with children and raises the tax on poor people with children? Time for some spin?


http://www.alipac.us/f19/family-fair...milies-318323/

---

JohnDoe2, that is not an article about the FairTax. The FairTax is a national retail sales tax whose legislation repeals the income tax. That article you commented on is about a bill introduced by Lee and Rubio to change the existing earned income tax credit under the existing income tax system.

The FairTax is HR 25 in the US House of Representatives and S 155 in the US Senate, and the name of the bill is "Fair Tax Act of 2015".

But hey, your lack of knowledge about the FairTax such that you don't even know when an article is about it or not is pretty consistent with so far everyone I've run into who opposes it.

:p

'Family Fairness Tax Reform' is hard on poor families


The "Economic Growth and Family Fair Tax" plan from Senators Rubio and Lee is ambitious and expensive, but it may hurt many low-income families with children, according to new estimates...

Rubio-Lee: Promise and Problems

MARCH 9, 2015 2:52 PM March 9, 2015 2:52 pm 35

Last week, Senators Marco Rubio and Mike Lee released the outline of a comprehensive tax reform, which adds changes to corporate and investment taxes to their earlier proposal for a more pro-family revision of the individual code.

The plan earned generally favorable comments from Yuval Levin, Ramesh Ponnuru and James Pethokoukis, all writers associated with the tendency we’re calling reform conservatism, but the addition of tax cuts on the business side drew praise from a wider range of conservative and libertarian policy writers and economists as well.

The reformist interest in reorienting Republican tax policy toward middle-class families has created tensions with the party’s supply-side wing, but because it reforms the corporate/business code the Rubio-Lee plan clearly has the potential to be a politically-unifying vision, marrying pro-family and pro-growth policy while putting the era of “9-9-9″ and Fair Tax-style unicorns in the rearview mirror.

But of course it’s relatively easy to be a unifying vision when you don’t get within even distant hailing distance of being revenue neutral, which the new outline unfortunately does not. When the initial Lee tax plan earned a disappointing score from the Tax Policy Center, I wrote hopefully that the next iteration might close that fiscal gap … and indeed, the individual portion does take a step in that direction, by phasing in its top income tax bracket at $75,000 ($150,000 for joint filers) rather than the $87,850/$175,700 envisioned in the previous version. But that revenue-recouping move is simply swamped by the lost revenue from the business and investment reforms, which in a static score would probably leave Lee-Rubio costing the federal government anywhere from $3.5 to $4 trillion in lost revenue over the next ten years.

Which is, you know, a big number. It would likely be smaller in reality, because the reforms would have dynamic effects on economic growth. (The reform to the way we tax business expenses, in particular, incurs a major initial cost but delivers a system that would clearly favor growth and investment down the road.) But as Danny Vinik argues in a fair critique of the plan from the center-left, you have to be very, very optimistic about those effects if you want to argue that this vision wouldn’t create still-substantial deficits down the road. There are people on the right willing to be that optimistic, but I am not in their number, and I don’t think that panglossian attitude is an appropriately conservative response to the fiscal situation facing the United States over the next few decades. Vinik notes that a plausible-but-cautious attempt at modeling the dynamic effects of Dave Camp’s earlier tax reform blueprint came up with an estimate of $500-$700 billion in extra revenue from increased economic activity.

Give Lee-Rubio credit for being more pro-growth than Camp, and you’re still in territory where you’re recouping say, a third to maybe a half of the lost revenue … which still leaves you with a multi-trillion dollar deficit problem with the outline as it currently exists.

Now it’s pretty normal for big-ticket legislation to be scaled back and discover some of its pay-fors during the legislative process. But it’s also been pretty normal, these last few decades, for Republican presidents to scale back their tax cuts only modestly (George W. Bush’s went from $1.6 trillion in outline to $1.35 trillion in execution), and put their hopes in dynamic effects and future unspecified spending cuts to cover the rest. That habit, never ideal, at least had plausible arguments in its favor when the cost of Medicare and Social Security was a long way from coming due; now, though, we’re probably going to be dealing with structural deficits in some form no matter what for most of my lifetime, and unless conservatives are ready to embrace a Medici bank theory of the American future there is no good argument for piling more trillions on top.

So while I can sit here as a pundit and tell you various ways that the fiscal gap created by Lee-Rubio could be made up (short list: a more aggressive mortgage-deduction limit, set the corporate rate at 28 percent rather than 25 percent, put a 25 percent income tax bracket back in and set the top rate at 38 percent instead of 35 percent, phase out the child tax credit and the charitable-giving deduction for high earners, don’t take the capital gains tax rate to zero, keep the estate tax, etc.), given recent political and fiscal history the burden is on the Republican politicians proposing these reforms to actually include enough of those pay-fors to make it clear that this proposal isn’t just going to end up as yet another round of deficit-financed tax cutting.

And their absence from this plan is a problem no matter how many virtues one identifies in its overall design.

In that sense I partially agree with the new outline’s most predictable, strident, but-not-altogether-incorrect critic, New York Magazine’s Jonathan Chait. Not, mind you, with his major thesis, which casts the new blueprint’s business and investment tax cuts, and the praise for them from writers like Levin and Pethokoukis, as a blatant surrender by reform conservatives to the essential nature of Republican politics. This frame misunderstands the kind of reform that these writers have been seeking, which has always encompassed some supply-side ideas: Indeed, one of the original versions of pro-family tax reform, presented by Robert Stein in the pages of National Affairs, included a capital gains tax cut, corporate tax reform, more favorable treatment for business expenses, and other ideas that ended up in Rubio-Lee. Most reform conservatives of my acquaintance accept the common right-of-center argument (which is hardly confined to the right-of-center) that you can get more economic growth with a tax code that’s more favorable than ours to savings and investment, and most of them don’t regard tax policy as a tool to whack at the incomes of the 1 percent or just tax reforms by their immediate impact on the Gini coefficient.

Rather — speaking for myself, but also I think for others — the reformist idea has been that Republicans should balance the pursuit of long-term growth with more immediate attention to the take-home pay of working families, and that this combination should be paid for by a ruthless attack on the tax code’s pro-rentier bias … which in distributional terms (as Stein says in his original essay) would end up raising taxes on some of Thomas Piketty’s petits rentiers (the upper middle class, that is) while probably cutting them somewhat for the super rich. As a would-be conservative class warrior I’m fine with that outcome, so long as we’re also reduces the tax burden on people struggling to stay in the middle (rather than raising it, as some of the more dubious Obama-era Republican proposals would have done). There’s no necessary contradiction between a tax code that favors investment, by individuals but especially by businesses, on pro-growth grounds, and a tax code (and welfare system) that favors work and childrearing for people who aren’t likely to become part of the investor class. And the pursuit of both goals can redound to the common good, since those middle-class employees and parents stand to benefit from larger paychecks now and from higher growth rates in the future.

But the balance has to be right — the balance between the pursuit of growth and the focus on middle-class opportunity, and then the balance between those goals and fiscal sustainability.

And in its effort to woo and reassure supply-siders, and unite their goals with reform conservatives, the current Rubio-Lee plan seems to have ended up unbalanced on both fronts.

Even if you set aside deficit concerns, it is too solicitous of the strict supply-side vision: Everything on the business and investment side happens on a scale that’s double or even quadruple what went into the original Stein proposal, and as my old friend Reihan Salam writes, if you’re going to put together a package of tax cuts of this size, with dollar figures in the trillions and trillions, the reform camp should be able to up its “ask” on middle/working class tax relief as well, and demand (say) even more payroll tax cuts than what the child credit offers. And then, as I’ve said, those deficit concerns are perfectly valid as well: $4 trillion in deficit-financed tax cuts is simply not reasonable given America’s current fiscal situation, and the record of the modern Republican Party offers no reason to trust that pay-fors will emerge organically once a Republican president has been elected.

They need to be provided upfront, in some form, for a plan like this to deserve support.

So, in sum: The Lee-Rubio blueprint is broadly consonant with the goal of conservative reform, its tax structure would be much better for families and businesses than what exists today, and something like its synthesis of family-friendly and pro-growth policy is both sensible on the merits and necessary to unite the G.O.P. But its details (or the lack thereof) also offer more grist for skeptics of Republican seriousness than earlier iterations did: It has real problems, deserves real criticism, and needs further work.

http://douthat.blogs.nytimes.com/201...-and-problems/