Enforcers At The IRS Harass $10 An Hour Worker

A hair stylist in Seattle who makes fewer than $20,000 a year was recently investigated by the IRS because the government organization claims that she does not make enough money to live where she does. According to the IRS, Rachel Porcaro, cannot possibly be living on her low wages and they have determined that she is not making enough to provide for her children so she is losing her earned income credit.

I am no fan of the EIC but it is legal and if she is entitled to it, she should get it. But the IRS is convinced that she makes too little and they believe she must have unclaimed income.

Porcaro lives with her parents and does not live a lavish lifestyle. The IRS spent tens of thousands of taxpayer dollars in order to get a little more than a thousand dollars from Porcaro. That is efficiency at its finest. To top it off, Porcaro and her family are out thousands of dollars because they racked up bills defending against the harassment.

Why is it that a guy like Tim Geithner can deliberately not pay his taxes and he does not get fined or put in jail but a $10 an hour worker is harassed by the IRS? The same is true for Charlie Rangel who is a tax cheat. Why does not the IRS spend more time going after real tax cheats (just look at the Obama administration or Congress for that matter) and leave hard working people alone.

Obviously if this woman or any other taxpayer is breaking the law then the IRS has a duty to check it out but people in this income pay NO taxes. Why harass them when there are people skirting the tax laws everyday?

We need to abolish the IRS and simplify the tax code so that everyone pays a piece of the bill and we need to eliminate things like the EIC that allows people who pay NO taxes to get money back. This is backdoor welfare.

But until we do just that, this woman and many more like her are living on what they make and filing taxes in accordance with the law.

H&R Block did her taxes so it is not like she cheated them. Besides, she pays no taxes so how could she cheat anyone?

As for her kids, neither she nor her parents can claim any EIC. She cannot claim her kids because the IRS says she can’t possibly be taking care of them.

And yet she is.

Government idiocy at its best.

Hey IRS, go pick on the tax cheats in government and leave the hard working folks who try to obey the laws alone.

Big Dog

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22 Responses to “Enforcers At The IRS Harass $10 An Hour Worker”

  1. Adam says:

    “Why harass them when there are people skirting the tax laws everyday?”

    The IRS thought she was skirting the law by under reporting on her tax returns. The fault here is not the audit but that the IRS did not drop the investigation after looking into it further and seeing the premise was faulty.

    But there’s a part of this story you left out. The part where the Republicans in a recent session of Congress ordered the IRS to ramp up the audit of those who claim EIC. This is how they look out for the hard working folks.

    • Blake says:

      Adam, the fault is the bureaucrats zealously pursuing someone on false evidence.
      Going after tax cheats is laudable, but don’t you think that Geithner or Rangel (especially) would have been a better use of their time and resources? They are PROVEN cheats, and they earn far more than that poor woman.
      The problem with the IRS, as with all other bureaucracies, is their stubborn refusal to back down in the face of adverse facts- they all feel that they must pursue a case IN SPITE of facts to the contrary.
      They remind me of the Catholic Church in Galileo’s time.

      • Adam says:

        I’m not understanding the references to Geithner or Rangel since they payed for their tax problems. They didn’t get away with anything.

        • Big Dog says:

          They paid no penalties or interest. Free ride

        • Adam says:

          Geithner paid plenty in interest but no penalty fee. I was wrong about Rangel though. I was mistaking him for somebody much less corrupt with his taxes. I just don’t understand Blake’s apparent call to investigate them again instead of other tax cheats.

          • Big Dog says:

            Even if Geithner paid interest but no penalty why is that? And how is he now qualified to run the Treasury? Rangel is another issue all together. Once the IRS realized the $10 hairdresser was not doing anything wrong why did they continue to pursue her? It is one thing to look at returns more closely but without evidence of cheating why spend thousands on someone who pays no taxes?

            • Adam says:

              Geithner wouldn’t be the first politician to get preferential treatment from the government because of his position but it’s also not unheard of for the IRS to forgo penalties. They’ve done it for me several times.

              “It is one thing to look at returns…”

              I’m with you on this one. I don’t think there’s many people out there who think the IRS is perfect and this is definitely stupid.

            • Big Dog says:

              It was foolish of the IRS.

              I understand that they would not be the first to receive preferential treatment but that does not make it right. If a cop got caught driving while drunk and the judge said he was free to go because he is a cop we would be outraged, and rightly so.

              Cops should be held to a higher standard because of what we entrust to them.

              The same is true for politicians, all of them from all parties.

              But I agree, the IRS has bigger fish to fry (I know that will mess with your vegan mind).

            • Adam says:

              As long as the IRS catches the fish instead of buying them at the store…

        • Blake says:

          Adam, a ten dollar an hour worker will never net the IRS anything more than distain, while going after Rangel and many others who actually owe millions could get the IRS millions- I doubt the $10 an hour worker could equal THAT- but then she is not “connected” like Rangel, so she cannot cheat with impunity, as many of the others seem to.
          Free rides seem to be the domain of the Liberal Progressives- like Kenneth Creamer, who served a stint in prison for defrauding Banks out of millions, and yet, because he is married to a Congresswoman, can get into State dinners, and hobnob with other progressive criminals, all without the onus of being thought of as a criminal and convicted felon. Don’t you just smell the hypocrisy?

  2. Adam says:

    “We need to abolish the IRS and simplify the tax code so that everyone pays a piece of the bill…”

    We already all pay a piece of the bill. What you mean to say is that we should all pay the same percent of the bill in some flat tax or a ridiculous “Fair Tax” scam that will just hurt the very people you pretend to care about in this post.

    • Blake says:

      Actually, in a fair tax situation, there would, of necessity, be a cut- off, where people who earn true poverty- level money would be helped, not penalized.
      But a flat tax would bring in more money, be more fair, and eliminate a great deal of the inequitable tax code we now have- all laudable accomplishments, and done at a fraction of the price we now pay for the burdensome system we now have.

      • Adam says:

        There is nothing fair about a flat tax. We have a progressive tax scale for a reason.

        • Big Dog says:

          There is nothing fair about a progressive tax. We all derive the same benefit from the government so why do those who use fewer government items get charged more?

          10% of your income is the same for everyone. I don’t necessarily favor a flat tax (I go back and forth on it) but the progressive tax is in no way fair.

        • Adam says:

          The impact of 10% (it would be more like 20% or 25% in reality) is not the same for everyone. It never has been and never will be.

          • Big Dog says:

            The impact of who uses the tax dollars will not be the same for everyone but we all get the same benefit (in theory) from government. Why shouldn’t everyone pay for what we get?

            • Adam says:

              If you make $20,000 a year like Porcaro you would owe about $4000 to $5000 in taxes. If you made $200,000 like Joe the plumber hopes to make someday then you’d be keeping $160,000 to $150,000 after taxes. I think it’s pretty obvious that a flat tax is going to burden the lowest bracket of income earners and it’s going to benefit the highest bracket, the exact opposite of our current system.

            • Big Dog says:

              20,000 is before deductions but even at that it is 2000 a year and for the 20,000 it is 20,000 a year. 10% for each, the same amount of pain.

            • Adam says:

              Why 10%? The government would never have enough revenue. I’ve seen no flat tax plan go that low and even at the higher rates the flat tax plans create massive deficits. I doubt 10% would even cover defense, one of the few things you tend to support taxes for.

            • Big Dog says:

              Taxing the rich will never pay the bills but here is an idea, cut spending. And yes, I support defense because it is in the Constitution.

            • Adam says:

              We’re talking pretty deep cuts in spending to get to where only 10% taxes wouldn’t drive a deficit. I don’t know which is more of a pipe dream at this point: Radical changes to the tax code or radical changes to spending.

  3. Darrel says:

    Flat tax proposals are always loved and promoted by the very rich (like Steve Forbes) because they make out like bandits. And they already do (remember the Buffet example where most of his wealth is shielded from high taxes so he pays a very low rate on most of it).

    The US already has a very high level of inequality when compared with our peer countries and these anti-civilization types want to turn it up even more. Amazing.

    And this has profound societal results. Consider this excerpt from the book “The Spirit Level: Why More Equal Societies Almost Always Do Better”:

    ***
    The theory of everything

    These two British academics argue that almost every social problem, from crime to obesity, stems from one root cause: inequality.

    …almost every social problem common in developed societies – reduced life expectancy, child mortality, drugs, crime, homicide rates, mental illness and obesity – has a single root cause: inequality.

    “It became clear,” Wilkinson says, “that countries such as the US, the UK and Portugal, where the top 20% earn seven, eight or nine times more than the lowest 20%, scored noticeably higher on all social problems at every level of society than in countries such as Sweden and Japan, where the differential is only two or three times higher at the top.”

    The statistics came from the World Bank’s list of 50 richest countries, but Wilkinson suggests their conclusions apply more broadly. To ensure their findings weren’t explainable by cultural differences, they analysed the data from all 50 US states and found the same pattern. In states where income differentials were greatest, so were the social problems and lack of cohesion.”

    http://www.guardian.co.uk/society/2009/mar/12/equality-british-society

    What kind of mentality does it take for a person to look at the US’s situation and say: “hmmm… you know, I think the problem is the rich just don’t have enough money. Let’s make it so they have more. That would be more fair.”

    Pure lunacy. Thank goodness these nuts are out of power.

    D.