Abuse of Power

The odds are pretty good that with a median income of $13,330k per year, they don't own a house or have stocks and dividends. Any interest on on the nonexistent savings account is probably less than 10 dollars a year. They get their W-2s at the end of the year (one for each job) and file the short form because they don't have any deductions and the earned income credit is on the 1040. You plug in the numbers in the spaces provided, find your income bracket in the first few pages of the charts, transfer that number to the space provided and then you subtract. If you end up with a negative number (not likely unless you have claimed too many dependents) you send them a check for that amount. If it is a positive amount (which it should be) you sign the form and send it in ASAP so you can receive the refund of the money you earned but never saw in your checking account.

IRS Froze Refunds, Study Says: "The advocate's office, which is part of the IRS, looked at a sample of taxpayers who complained that they never received their refunds. In two-thirds of those cases, there was no evidence of fraud. Many of the returns were filed by low-income workers, including some who claimed the earned-income tax credit, which sometimes entitles filers to a cash payment on top of their refunds.

The median adjusted gross income of taxpayers who were found to have committed 'no fraud' was $13,330, and the median income of those who claimed the earned-income tax credit was $11,956. The median refund received was $3,685, which represented significant income for the taxpayers involved, said Taxpayer Advocate Nina E. Olson in her annual report to lawmakers on problem areas in tax administration.

Based on data from fiscal 2004, the Taxpayer Advocate Service estimated that as many as 1.6 million refunds have been frozen by the IRS's Criminal Investigation (CI) division over five years."

Once again the people who have the least, are the most affected by sweeping arbitrary decisions, and will suffer the most since they are usually working during the day and don't have the opportunity to go tracking down money that is rightfully theirs, earned by hard unappreciated work. Not that they are going to find out anything.

Taxpayers mystified at the disappearance of their refunds have flooded the Taxpayer Advocate Service with requests for assistance. Last year, the TAS handled more than 28,000 such requests, up from about 16,400 a year earlier, and such complaints now represent the largest number that the advocate service receives about any IRS program.

However, IRS employees, including those of the TAS, generally are forbidden to give a taxpayer any information about a missing refund until six months after the taxpayer contacts the agency, Olson's report said.

Try that tactic on your end and find out what happens. The funds in your checking account will disappear overnight with no warning. Six months, how special.

Indeed, the TAS said, "they may be left in permanent freeze status," adding that it "identified numerous cases that remained [frozen] for over three years."

Olson recommends that taxpayers be notified promptly if refunds are held up, and in cases where fraud is identified, that returns be referred immediately to auditors. She also suggests taxpayers be notified of their right to sue in U.S. district courts or the U.S. Court of Federal Claims to get their refunds.

And her report, which lists the most significant problems with the tax system, finds that the refund freezes are only the second-most serious. No. 1 on Olson's list is the IRS plan to allocate more resources to enforcement and less to taxpayer service while moving "to 'migrate' taxpayers toward electronic services and away from face-to-face contact," which affects the greatest number of taxpayers.

Now it's the War on Taxpayers! Of low financial standing only. This means anyone under $200k per year had best be prepared to defend themselves and realize that you are a criminal until proven otherwise.

Tags: IRS, Tax refunds,