In a Reddit post that’s going viral, a former IRS agent is spilling his guts, answering anything, and describing why he thinks the IRS is broken — and what he’s telling the government to do about it. He’s summarized his letter in 16 points. The highlights are below.
Mike Gregory says that the title of his full letter to the IRS is “The Wheels are Falling Off the Bus,” and that Congress is putting more demands on the agency while pulling funding, leaving the IRS subject to attacks by cheats and dodgers, which will leave the rest of the American public held responsible to pay. His full 16-point summary of his IRS letter is here, but here are the highlights.
- The IRS is responsible for bringing in 90 percent of the Federal government’s revenue.
- The IRS budget is steadily being cut — from $12.3 billion in 2012, to $11.8 billion in 2013, and projected $10.2 billion in 2015.
- Every dollar the IRS spends in enforcing tax codes returns between $4 and $7 in revenue for the government.
- “Voluntary compliance,” or taxpayers who pay up without being pursued, make up 97.5 percent of the revenue the IRS brings in. IRS audits and enforcements supply the other 2.5 percent.
- Voluntary compliance is falling, and delinquency is on the rise.
- The last study, in 2006, saw that only 83 percent of people were paying taxes without IRS enforcement; the IRS has not received funding for research since.
- If compliance drops by 1 percent, the Federal government loses $30 billion in tax revenue.
- The IRS’s Crime Investigation Department recently closed two cases that netted a total of $9 billion dollars. In 2016, Congress aims to cut this department by half, risking further such revenue.
The former IRS Specialist previously posted an AMA (an invitation to “ask me anything”), in which he offered three items he’d do to “fix” the IRS.
1) Simplify the internal revenue code – if you took 60 lines per page with no margins (that’s a lot of lines) the code is 34.5 inches high. The regulations are 3.5 times larger. That’s almost 13 feet high. Nobody can understand all of that. Congress has passed more than 4,000 code sections in the last 10 years – that’s more than 1 code section per day. When I started, I could hold the internal revenue code and the regulations in my hand! – I’ve actually got them at home.
2) Address issues related to inversions and international tax
3) Fund the IRS properly – increase funding consistent with the recommendations of the non-partisan IRS oversight board (2.3 Billion!)
Gregory did provide proof of identity for his AMA, in the form of a photo of himself with plaques and documents identifying him as an IRS employee.
— Michael A. Gregory (@MikeGregConsult) October 17, 2014
It seems almost everyone has a complaint about the IRS, ranging from simple grumbling about taxes, to allegations of persecution, but for the first time, there’s a public statement about what a former IRS agent, an insider himself, thinks is wrong with the agency: and most of it comes down to funding.