President Joe Biden’s nominee to lead the IRS pledged during his congressional testimony Wednesday to make the agency’s auditing process more “equitable.”
Daniel Werfel responded to a study by Stanford University claiming that Black taxpayers are disproportionately targeted by audits. And while this is true, the facts of the matter bear closer examination.
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The Biden regime? They just gave BlackRock $500 Billion, while sending the IRS after waitresses.
People, Democrats hate you! pic.twitter.com/tcXiKvpTIF
— Alex ❎ (@AlexChecked) February 10, 2023
First and of supreme importance is that the IRS does not have a “race” box and has no way of knowing this detail about any individual taxpayer.
Because of this, the study had to do extensive cross-referencing with the Census Bureau to ascertain who was being audited.
Black filers at a significantly higher rate claim lower-income tax credits, such as the earned income tax credit (EITC) or programs for single parents. Claiming these credits increases the chances of an audit, usually in the form of a letter requesting more information.
That’s because these filings result in significant refunds, though that term is misleading since it refers to money that was never paid to the federal government in the first place.
The frequency of audits is triggered by an IRS algorithm, which is designed to target filings most likely to need further scrutiny.
Of course, it doesn’t help matters that the Biden administration just supercharged the IRS with nearly $100 billion in funding to hire tens of thousands of agents. Now those agents will be charged with enforcing taxpayer “equity.”
This should be cause for concern for every upright taxpaying American.
Senate Finance Committee Chairman Ron Wyden (D-OR) called the Stanford study “troubling” even as he admitted that the IRS does not collect information or race. He still concluded that the findings raise “serious questions about discrimination.”
Werfel, who is a former acting IRS commissioner under the Obama administration, said the results were “concerning.” He further asserted that “fairness is an essential element of tax administration.”
He called it “particularly alarming” that IRS audits result in a “disparate impact on racial minorities.”
Wyden asked for affirmation that Werfel, upon confirmation, would report back within 60 days on “why there is this discrimination” and what corrective measures he would take. Werfel, of course, responded that he would.
It will be interesting to follow just how the massive IRS bureaucracy will reshuffle the deck to target different taxpayers. That will require some concerted effort without having a race box added to income tax returns.
