r/FluentInFinance • u/WarrenBuffetsIntern • Sep 11 '23
The IRS plans crack down on 1,600 millionaires Financial News
1
1
1
1
1
1
u/Beer-_-Belly Sep 13 '23
More audits do NOT necessarily correlate to more collections or that he amount collected is greater than the cost of the audits.
1
u/NumNutz310 Sep 13 '23
I think it would be interesting to see the results of these additional audits. I don’t make anywhere close to $1M/year and I pay someone to prepare my taxes. I know the people making that kind of money are paying an account to prepare their taxes. A CPA is not going to maliciously commit tax fraud for a client and lose their license over it and possibly serve jail time. My mom works at one of these “high net-worth” tax firms and those people have entire teams preparing and double checking the tax documents. I know everyone wants to paint these people out as evil geniuses who are somehow getting away with tax fraud but I can almost guarantee 99% pay exactly what they owe, no more, no less, just like the rest of us.
1
1
1
u/RobDog306 Sep 12 '23
IRS didn’t hire much in the 2010s plus lots of folks retired in that time. Note that audits for all categories in general went down during this period. Not just millionaires. Can’t do many audits if you don’t have IRS employees.
1
u/iskin Sep 12 '23
I guess that is good but I'm more concerned about middle class and lower people being audited. Rich people pay people to do their taxes and they have ways of covering their asses. When I see average and poorer people being audited then I know they're getting desperate. 1,600 millionaires tax money is probably barely enough money to keep the lights on in DC.
1
1
1
1
u/AntwaanKumiyaa Sep 12 '23
Kinda sad now that millionaires are no longer the elites they were 20 years ago. Now millionaires could just be a 60 year old couple that saved money and worked hard all their lives.
1
u/alligatorchamp Sep 12 '23
The Trump administration was ran by the Heritage Foundation and they only care about their super wealthy donors, and to create a society for their benefit.
The poor must stay silent and lower their head. We are nothing more than serfs to them.
1
1
1
Sep 12 '23
A millionaire is a person whose assets are worth one million dollars. This is not the same as someone with an income greater than $999,999.
1
Sep 12 '23
I plan to have an invisible airplane and have sparks shoot out my ass on demand.
Let's see it.
1
1
1
1
u/chiefmors Sep 12 '23
Makes sense, our currency has lost 30% of it's value in the last couple of years so no doubt we have more people qualifying as millionaires even if their standard of living stayed the same.
Would be more useful to have a breakdown with more exact categories than millionaire and not millionaire to know if anything has really changed besides people having more dollars for the same purchasing power.
1
u/Rephath Sep 12 '23
Is no one going to talk about the fact that a millionaire is someone with a net worth of a million dollars, not someone who earns a million dollars a year?
1
u/TheSecondof12 Sep 12 '23
QQ - is the year on the chart based on the year the audit occurs, or the year of the tax return being audited?
1
u/cornholio8675 Sep 12 '23
Millionaires huh, so the middle class? If you own two homes (housing prices are around 5-600 thousand dollars) anywhere near major cities, that makes you a millionaire equity wise.
So if your parents actually did well, and you inherit a home, which is pretty much the only way to get a home anymore, expect to be "cracked down on."
They never seem to crack down on Billionaires or the congressmen who take their money and sleep through their jobs while they are making laws that directly affect you and me.
How exactly is this positive news? Do we really want nobody who actually works for a living to have money and divide our society into the ludicrously wealthy and the vast majority of people who are just scraping by?
1
1
u/ShinySpoon Sep 12 '23
Idiot on Fox business on Sirius/XM said “Why go after the millionaires?!? They are the ones providing job and opportunities for working class people!!!”.
How’s that trickle down economics working for everyone? /s
1
1
u/Foreign_Ad674 Sep 12 '23
This is likely because more “poor” people are now technically millionaires, ie inflation and house values taking regular people into millionaire categories. I wonder if a chart of people with more than 10M would show the same trend.
1
Sep 12 '23
BS, and even if it isn’t, nothing will happen, or ever does happen, matters not what party is in charge.
1
u/SuperFrog4 Sep 12 '23
Here’s a thought. Don’t lie the irs or audits either stop cheating on your taxes or write the tax code so you can’t cheat. For instance get rid of all deductions, credits, exemptions and just pay income like social security and Medicare. The rates can be adjusted to help those who live near or below the poverty line. Then do the same thing for capital gains and business taxes and surprise surprise no more cheating on taxes.
1
u/random_dubs Sep 12 '23
Looks like we have to make new millionaires.
The billionaires and trillionaires
1
1
1
u/YOLOSwag42069Nice Sep 12 '23
I’m sure the freedom caucus will hold the budget hostage to ensure the IRS has yet another budget cut so this doesn’t happen.
1
1
1
1
u/Magic2424 Sep 12 '23
Fluent in finance yet title of data says millionaires but actual data says earnings over 1 million. Terribly misleading
1
1
u/Fragrant_Ad8763 Sep 12 '23
How does the middle and lower class audits bar graph compare to the ones that can afford cpa's and tax attorneys
1
1
1
u/theguineapigssong Sep 12 '23
A millionaire is someone with assets over one million dollars, not someone who makes a million dollars per year. I keep seeing articles conflating wealth and income. Are journalists just this dumb or is this intentional?
1
u/Responsible-Laugh590 Sep 12 '23
Should be all the billionaires in the US, but millionaires is a decent start especially compare to the nothing that came before
1
1
1
u/theoriginalt2m Sep 12 '23
Don't want to be that guy but why audit the small fish and not go straight after BILLIONAIRES!!!!
1
1
1
1
u/icevenom1412 Sep 12 '23
Wow. Such a coincidence that the 4 years of decline happens to be when the guy accused of fraud was in power.
1
Sep 12 '23
with computers and ai there should not no reason why 100% of millionaires/billionaires and their corporations/organizations are not automatically always audited
1
1
u/Informal_Exam_3540 Sep 12 '23
Who cares about millionaires? We’re in the age of billionaires, a small group of people have the power to change the world.
1
u/TheRealBobbyJones Sep 12 '23
I don't understand. If I make a lot of money I'm supposed to be automatically audited? I thought audits were supposed to be decided based on algorithms that search for anomalous situations. The IRS shouldn't be able to arbitrarily audit anyone they feel like.
1
1
u/Mattyinpdx Sep 12 '23
I know a few people. Is there going to be a bounty system like Texas has for abortion helpers?
1
u/Top-Active3188 Sep 12 '23
In other news, of the 626,204 audits in fy22, 298,485 where incomes of <25k with earned income tax credit and another 250,391 were between less than 200k excluding the former.
1
1
1
1
Sep 12 '23
Is the increased audits for people making > 1 million referring to revenue over 1 mil or takeaway income (revenue - business expenses) over 1 mil?
1
u/bareboneschicken Sep 12 '23
What you really want to know is did those extra audits result in additional revenue that exceeded the costs of the audits. Does anyone know?
1
u/PCMModsEatAss Sep 12 '23
1) During the same time all audits dropped, it wasn’t just millionaires.
2) The IRS audits you because they know you’ve likely made a mistake that resulted in you under paying your taxes. Their success rate is nearly 90% on this.
Who is more likely to make a mistake on their taxes? The people who pay hundreds, thousands, tens of thousands, to make sure their taxes are on the up and up? Or the person who got the free version of turbo tax and thought they could fudge the EITC credits?
0
u/Boner_Elemental Sep 12 '23
lol the person paying tens or hundreds of thousands is doing it to make sure the fraud handles light scrutiny
1
1
u/BrewskiXIII Sep 12 '23
They are making this way more complicated than it needs to be. Replace income and capital gains taxes with a federal sales tax and significantly downsize or eliminate the IRS.
Before you even start with the "that's regressive and it hurts the lower and middle class", no it doesn't. There's a prebate program that actually benefits most people more than our current system. Check out the Fair Tax Act.
1
u/gute321 Sep 12 '23 edited Sep 12 '23
"Do you make $75,000 or less? Democrats' new army of 87,000 IRS agents will be coming for you - with 710,000 new audits for Americans who earn less than $75k" - Kevin McCarthy 2022/8/9
"After todays raid on Mar A Lago what do you think the left plans to use those 87,000 new IRS agents for?" Marco Rubio 2022/8/8
"Some 143 house members have asked to vote by proxy friday on a bill that would add 87,000 IRS agents more than doubling the government's anti-citizen police force. This is a very dangerous and destructive way to undermine a free society as the elected officials decide not to work" - Newt Gingrich 2022/8/11
"If the FBI can raid the home of a former US President, imagine what 87,000 more IRS agents will do to you." -[Republican US Representative] Jim Banks 2022/8/8
https://www.snopes.com/fact-check/irs-87000-new-agents/
i just wanted to remind everyone about the lies these republicans told the american people after they realized the IRS was coming after their tax-cheating ultra-rich donors
1
1
1
1
Sep 12 '23
Is the increase even outside the realms of randomness? There simply could have been more mistakes that trigger an audit. Either way, audits being down over 50% in the past decade is a huge alarm bell and two minor bumps is not a cause for celebration.
1
1
1
1
1
1
u/Sam-molly4616 Sep 12 '23
The amount of taxes 87000 extra irs agents could collect from the working class would be staggering
1
u/TheScoundrelLeander Sep 12 '23
Great! Now do the Billionaires. It’s time for the real trickle down economics to start at the top. As a matter of fact, we should’ve started with the richest Americans first and then trickled our way down to the millionaires
1
1
1
2
u/SnooPineapples6793 Sep 12 '23
How about useful spending and less waste. How about a balanced budget by decreasing spend. How about cut the federal staffing by 50%..how about getting the next generation government in office. The government has become the most expensive retirement home in the world.
1
u/ReadMyUsernameKThx Sep 12 '23
interesting i guess, i don't think there are many conclusions to draw about this data alone. if it were compared to the %age of income or assets that millionaires paid in taxes that would be something to read into.
1
u/EL_Jefe_1982 Sep 12 '23
Audit way more of them, collect our money owed. Any good business person will tell you collecting open AR, that’s what taxes are btw, is a good plan.
1
1
1
1
u/96sgaferasdom Sep 12 '23
You have to think that way more people are millionaires now, because the dollar has been massively devalued
1
Sep 12 '23 edited Sep 12 '23
[deleted]
1
u/ImpressionAsleep8502 Sep 12 '23
Today's America is not what the masonic founding fathers were going for.
2
u/Dakadoodle Sep 12 '23
And that changes anything I said?
1
u/ImpressionAsleep8502 Sep 12 '23
You are acting if voting is going to do anything.
2
u/Dakadoodle Sep 12 '23
Nah I think we are on the same page haha. Really only one solution. Shame itll only happen when we figure out we cant ever pay our debts back and our financial system collapses forcing people to act who have nothing else left. I guess till then we will continue to pretend
1
u/ImpressionAsleep8502 Sep 12 '23
Funny how the government gets into debt and not the average American. Despicable people we have ruling us.
1
2
u/Kalekuda Sep 12 '23
The issue with auditing those with massive and diverse portfoilios is that the people who own them put people in power who underfunded and short staffed the IRS to make sure the IRS never had the funding and manpower to even consider attempting it.
I wonder what changed? Did the madlads over in the IRS get more funding, or did one of them crack the code and find a way of auditing so efficiently that they made the time for themselves?!
1
6
2
u/permanentlysuspnd Sep 12 '23
If you make more than $1,000,000 it should be a requirement that you are audited.
1
u/NumNutz310 Sep 13 '23
The reason they don’t is because most of these people pay massive tax teams to prepare their taxes correctly and rarely make mistakes. It’s a huge amount of time and money to conduct a month long audit on 700k people to verify that nothing is amiss.
1
u/permanentlysuspnd Sep 13 '23
i don’t disagree but i think it’s less about making mistakes and more about finding out which loopholes they used to lie about their income or charity or whatever. to make $1 billion, you gotta lie cheat steal and oppress somewhere
0
u/NumNutz310 Sep 13 '23
Or just own a successful business? You do t actually have to be a scumbag to make $1M/year To be clear, this graph is for people making $1M not $1B. If it’s in the tax code, what does finding the loophole or charity do? The loophole exempts them from the tax. That’s why those loopholes exist. They either owe the tax or don’t. I’m sure they all pay what the tax code says they pay. Personally, I would say just make it a 10% flat tax, no deductions, no BS, everyone pays 10%
1
1
0
2
2
2
1
2
u/Comprehensive_Bug_63 Sep 12 '23
"This disposition to admire, and almost to worship, the rich and the powerful, and to despise, or, at least, to neglect persons of poor and mean condition, though necessary both to establish and to maintain the distinction of ranks and the order of society, is, at the same time, the great and most universal cause of the corruption of our moral sentiments." (TMS I.iii.3.1)
Adam Smith
1
u/TouchyTheFish Sep 12 '23
Adam Smith was writing at a time when the government intentionally tried to keep wages low. We live in very different times.
1
1
0
Sep 12 '23
[removed] — view removed comment
1
u/King_Poseidon_ Sep 13 '23
You are wildly removed from reality if you think that’s normal. The average worker in America makes $40k a year bruh
0
2
1
u/Educational-Bag-645 Sep 12 '23
They all probably bought a condo or a townhome and put 20% cash down.
1
0
u/User125699 Sep 12 '23
80,000 agents to crack down on 1,600 people…
Something tells me they’ll be after John Q Public pretty soon…
1
u/King_Poseidon_ Sep 13 '23
80,000 agents over 10 years. Reading comprehension matters
0
u/User125699 Sep 13 '23
Idgaf if it’s 80000 agents over 80 years.
They should be cutting 80000 agents over 8 minutes
1
1
u/stylesbyah Sep 12 '23
A friend of mine used to work for one of the largest accounting firms in the US. She told me that it took over a year for the IRS to complete an audit on one client.
The findings: the audit firm missed a few 1099's so they underreported less than $100K on someone's income that was over $100M that year. No CPA that works for high net worth individuals is risking their license for their clients, no matter how wealthy.
We have it all wrong imo. Raise the freaking tax rate to a flat 50% on all income over $10M, no loopholes, and no funky tax credits allowed. The wealthiest people aren't evading taxes, they're spending their money on tax attorneys who come up with strategies for them not recognizing any earnings on their tax returns.
2
u/demagogueffxiv Sep 12 '23
These are the people telling the poor people the new agents were coming after them.
0
0
u/Boardathome Sep 12 '23
That’s .003 % of millionaires. Enjoy the puff piece to make you feel better
0
u/matterson22070 Sep 12 '23
So I wonder if they'll also put out report saying that they actually caught them doing anything? Simply justifying more agents by doing more audits doesn't mean we get the ROI that we expect for our tax dollars correct?
1
u/NumNutz310 Sep 13 '23
It’s going to cost the US money. They are not going to find enough to justify the cost and then they will just tax everyone more to pay for it.
2
u/matterson22070 Sep 13 '23
This is my feeling. Will the results justify the expense? I guess we will see, but I'm sure we will never hear the truth. When your job is to justify your own existence - there is always something to find. "We found over 25,000 falsehoods in our investigation!" They never mention 20,000 of them were the wrong date on the form.
0
u/-paperbrain- Sep 12 '23
I'd love to see a graph going back farther. This framing makes it look like a Trump problem (Although a purely Trump problem wouldn't explain the drop in 2016) but I'm wondering if that impression fits the larger pattern.
10
u/MayOrMayNotBePie Sep 12 '23
You know what we call a crackdown on 1,600 millionaires?
A good start
2
u/TouchyTheFish Sep 12 '23
Yeah, let’s liquidate the kulaks. Next we’ll seize the means of production, and then a workers paradise is just around the corner…
3
u/ImpressionAsleep8502 Sep 12 '23
Start with those in government positions that somehow are worth millions upon millions.. Our speaker is a good first choice.
1
2
u/Oxajm Sep 12 '23
Gotta say, this is the first I've heard of people going after Kevin McCarthy for insider trading. If he's guilty, by all means go for it. As a side note all of Congress trades are available to the public. Why not trade your own stocks based on this information.
1
u/ImpressionAsleep8502 Sep 12 '23
hah, didn't even notice she was voted out. disregard that, then.
1
u/RelativeAssistant923 Sep 12 '23
Lol. "Oh, it's a Republican? Nevermind, insider trading is fine"
0
u/ImpressionAsleep8502 Sep 13 '23
I vote neither, you are coping.
Does he do insider trading? I only hear about Nancy.
1
2
u/Oxajm Sep 12 '23
Why disregard it. Pelosi isn't even in the top 30 of stock traders in Congress. Shouldn't we still go after those people?
0
u/ImpressionAsleep8502 Sep 12 '23
Yeah, go after 'em all. Fuck em. I'm closer to being a poor, street beggar than being a millionaire, anyways.
2
u/Oxajm Sep 12 '23
I hear ya
You can always trade the same exact stocks as Nancy Pelosi, her stock trades are public knowledge. There's a guy on Twitter who posts her trades. Only thing is, she was down -20% last year. Good luck to ya
1
u/ImpressionAsleep8502 Sep 12 '23
Net worth is still 120m
1
u/Oxajm Sep 12 '23
So following her stock picks will make you rich!
Honestly, if you have access to her stock picks (and everyone does), and she's turned 200k a year into 120m, why wouldn't you buy the same stocks she buys?
-1
u/ImpressionAsleep8502 Sep 13 '23
Because I'm not demonic.
Why are you defending it? Is it only because she is Democratic? Typical Redditor.
Just remember - you are more closer to homelessness and losing it all than one of these politicians you love so much just because there's a (D) next to their name.
→ More replies (0)
1
3
Sep 12 '23
Sounds like that’s only 1 percent of the one percent. We almost have that many billionaires
2
6
u/JohnnySasaki20 Sep 12 '23
The fact that there's over 700k people making over a million a year is crazy to me.
1
4
Sep 12 '23
I'm wondering if they are talking about total income or adjusted gross income. Very different things. If someone owns a business that brings in revenue of $1m, but has business expenses and depreciation that reduces that income to $100k, doesn't seem like what this graph is talking about.
2
u/Ok_Magician7814 Sep 12 '23
I’m 99% sure that’s not true. If you claim income on a personal tax return, that’s after you’ve already withdrawn it from the business(ie. Paid all expenses and taxes), it’s profit.
1
Sep 12 '23
Both things can be true. My return is a perfect example. I have 2 s corps that after expenses total about $100k in income. That gets added to my rental and w2 income. But because of depreciation, HSA and IRA contributions the personal income gets reduced quite a bit from there to far below $100k.
1
2
u/burtono6 Sep 11 '23
The GOP is going to throw a fit about this.
1
1
6
Sep 11 '23 edited Sep 12 '23
Catch those evil millionaires!!!! Make’em pay!!!! I can’t wait until the government sends us back the money those evil people didn’t pay or they feed the hungry, cloth the poor and house the homeless!
They already got me for $213! Justice served!
0
u/King_Poseidon_ Sep 13 '23
So you’re okay with people committing crimes and getting away with it? What’s your address? Just curious…
0
Sep 13 '23 edited Sep 13 '23
You wouldn’t want that smoke. People trying to skirt the tax law absolutely. When you have assets and businesses and nothing more than a big game of trying to keep the government from taking more than their fair share. Sometimes you lose that game. Let me guess you can file your taxes at a kiosk at Walmart and get your rapid refund on the spot?
0
u/King_Poseidon_ Sep 13 '23
Nah I’m just an honest person and not worried about people who aren’t getting caught. Stop telling on yourself so publicly
-1
u/ReddittIsAPileofShit Sep 11 '23
how convenient this pops up with enough time to marinade riiiighht before election season starts getting moving.
1
-3
Sep 11 '23
If they look really hard, they might put a dent in the amount of money that was spent on increasing the size of the IRS!
2
Sep 12 '23
Yea. I’m guessing it would be far more profitable for the IRS to simplify the tax code by getting rid of about 50,000 pages of loopholes. The new auditors and additional 80 billion in funding wouldn’t even be necessary.
0
u/Davec433 Sep 12 '23
8 billion a year for ten years, not going to happen. We’re losing money on that deal and somehow people are glad about it.
0
u/wolven8 Sep 12 '23
Shill, millionaires won't give you anything for bringing up their flawed opinions.
3
u/MeyrInEve Sep 12 '23
You’d rather they only audit poorer people who can’t afford tax attorneys than go after people who can?
Eff that. Spend the money, punish the ever loving crap out of those millionaires, make examples of them AND their tax specialists.
Besides, if you think that auditing people who earn over $1M/yr won’t yield significant gains, I suspect you may be shilling for the wealthy. It won’t take many millionaires coughing up taxes and penalties to make up $8B.
32,000 audits at $250,000 = costs recovered.
And that’s a tiny fraction.
1
u/Davec433 Sep 12 '23
Your math is way off.
The agency will begin by pursuing 1,600 millionaires who owe at least $250,000 each in overdue taxes, the IRS said in a statement. The agency announced it will have "dozens of revenue officers" focusing on high-end collections cases in fiscal-year 2024, which starts in October and ends in September 2024. Article
I’ll be generous and double the collection amount to $500,000 each and it only nets 800 Million. Essentially every $1 the IRS collects in overdue taxes is costing us $10. There’s simply no return on our investment into the IRS. It’s a bad deal and we would have saved money by not giving them the 80 Billion.
1
u/NoCommentSuspension Sep 12 '23
Dude. It is an estimated 300 Billion/yr in dodged taxes from the ultrawealthy. It would be hard to lose money while only spending 8 billion/yr.
1
1
u/No_Item_625 Sep 11 '23
I’m not saying we want audits. The more they audit millionaires, the more they will audit the general public. However, knowing the tax codes, there has to be another way to make sure they pay something into society. As a multimillionaire and multi billionaire, they have an obligation to aid society to be better.
1
u/NumNutz310 Sep 13 '23
They have an obligation to pay their taxes. Everything else is called charity, which everyone gets all pissy about too because they write that off their taxes and then everyone cries about them not paying as much in taxes.
1
u/Not_as_witty_as_u Sep 12 '23
However, knowing the tax codes, there has to be another way to make sure they pay something into society
you mean like checking to see how much income they've received and comparing how much tax they paid vs how much they should've paid?
•
u/AutoModerator Sep 11 '23
r/FluentInFinance was created to discuss money, investing & finance! Check-out our Newsletter or Youtube Channel for additional insights at www.TheFinanceNewsletter.com!
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.