High Income Taxpayers Hammered From All Sides
It’s bad enough that folks with the highest income pay most of the freight, but now comes word from IRS that they’ve increased their surveillance of these folks’ affairs.
Last week, the Revenooers released their “2012 IRS Data Book,” in which IRS notes, “Overall, in FY 2012, individual income tax returns in higher AGI classes were more likely to be examined than returns in lower AGI classes.”
IRS examined about 12.1 percent of the 337,477 tax returns reporting income of $1 million or more, compared to 2.8 percent of those reporting between $200,000 and $1 million, and 0.4 percent of most of those reporting income under $200,000.
But we guess the taxing authorities just aren’t finding enough dough, because the politicians keep coming up with more things to tax. Take, f’rinstance, Berkeley City Councilman Gordon Wozniak who has cooked up the idea of taxing emails!
“There should be something like a bit tax,” quoth Wozniak during a recent council meeting. “I mean, a bit tax could be a cent per gigabit and they would make, probably, billions of dollars a year.”
Recall that Congress, in 1998, passed a law called the Internet Tax Freedom Act, which bans Internet taxation. But that law is scheduled to expire before the end of this year.
We hear the notion of a “bit tax” was cooked up by a guy named Arthur Cordell, a former information technology adviser to the Canadian government. “While there are few kudos for proposing a new tax, the time is ripe to suggest positive and constructive ways of dealing with serious fiscal realities,” quoth Cordell in 1997. “The move to a new economy should be matched by consideration of a new tax base. A tax base that is growing. A tax base that is at the heart of a new economy. A tax base that can be easily identified, one where collection is in few hands. A tax that is difficult to avoid.”
CONSULT YOUR TAX ADVISOR – This article contains general information about various tax matters. You should consult your CPA regarding the implications to your own particular situation.
Jeff Quinn, the author of this article, is a shareholder in Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He may be reached at 831-7288, welcomes comments at firstname.lastname@example.org, and invites readers to consider his other commentary at http://blog.nolo.com/taxes.