“Some taxpayers shortchange the American people by nearly $300 billion, which is roughly $950 for every man, woman, and child in America,” said Senator Tom Carper (D-Del.) at a roundtable discussion to find ways to cut the tax gap. With the financial crisis continuing to drive stocks down and the impending bailout bail threatening America’s national debt levels, he said, it has become more important than ever to ensure taxes are being paid and to collect additional revenue without having to raise taxes in the next administration. The tax gap has not been examined since 2001, when more than $290 billion was not collected.

The discussion panel included the Inspector General, members of the U.S. Government Accountability Office, the National Taxpayer Advocate from the Internal Revenue Service, and members of the U.S. Treasury Department. Each panelist discussed seven ideal proposals to close the tax gap. These included the encouragement of more frequent, voluntary estimated tax payments by small businesses, the withholding of payments to noncompliant federal contractors, requiring information reporting by financial institutions about non-interest bearing accounts, reversing matching against state and local tax data, allowing voluntary withholding agreements among independent contractors and service recipients, eliminating the exception to 1099 information reporting for closely held corporations, and improvement of the IRS’s data collection infrastructure. Carper has not specifically advocated any one of these proposals and believes that “no single approach, alone, will work.” Carper encouraged the participants of the discussion to “think outside the box for new solutions.”

Senator Carl Levin (D-Mich.) says that the willful failure to remit payroll taxes is a felony and a disgrace, at a hearing on payroll tax abuse before the Permanent Subcommittee on Investigations of the Committee on Homeland Security and Governmental Affairs. Levin notes that in 1998, unpaid payroll taxes came up to $49 billion but now it has significantly increased to $58 billion. (0:37)

 

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Over 1.6 million businesses owe more than $58 billion to Uncle Sam, according to Senator Carl Levin (D-Mich.) at a hearing before the Committee on Homeland Security and Governmental Affairs on unpaid payroll tax abuse. A study by the Government Accountability Office (GAO) concluded that more than half this debt is now uncollectible. (more…)

The House Committee on Ways and Means subcommittees on oversight and social security held a joint hearing focused on investigating the status of economic stimulus check distribution to needy Americans.

Members of Congress questioned Nina Olson, national taxpayer advocate at the Internal Revenue Service (IRS), about the progress her department as made in helping to ensure stimulus checks are distributed more quickly to citizens hurting financially. The panel of Representatives paid particular attention to asking Olson about the IRS’ efforts to help senior citizens fill out information to get stimulus checks, and were assured by Olson that such efforts were being made.

Congressman debated the efficiency the IRS has had in informing the public about filling out and receiving checks, and the amount of time it takes to distribute them. Rep. Kevin Brady (R-TX) argued that the Americans actually need to worry more about the appallingly high price of oil before focusing their attention on stimulus checks.

This morning the House Appropriations Committee held a hearing on the Internal Revenue Service through the Financial Services and General Government Subcommittee. Newly appointed Commissioner, Douglass Shulman and Deputy IRS Commissioner for Services and Enforcement Linda Stiff were on hand. Due to only being on the job for about three weeks, Shulman wasn’t able to answer a number of questions but was committed to get back to the committee members. He was questioned on the rebate program and the services the IRS provides to make filing tax returns simple for Americans.

At the CWA Conference, Senator Hillary Clinton (D-NY) says when she says solutions, she says, she will rebuild the middle class, and will end 55 billion dollars in tax breaks for oil companies, drug companies, insurance companies, and Wall Street, and will give that money back to hard working middle class families instead. You will get more help with student loans, health care for all, and millions of jobs that cannot be sent overseas because they will be created right here. I will cut middle class taxes, she says, by at least 100 billion dollars a year, and I will let taxes increase on people earning more than $250,000 a year. They have had their run, it’s time we shifted our priorities in the tax code. (:50)

 

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After the State of the Union, Senator Claire McCaskill (D-MO) expresses surpise at the President’s making light of economic issues. (0:39)

 

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