The IRS plans to end a major tax loophole for wealthy taxpayers that could raise more than $50 billion in revenue over the next decade, the U.S. Treasury Department says.
The guidance and ruling being announced Monday includes plans to essentially stop “partnership basis shifting” — a process by which a business or person can move assets among a series of related parties to avoid paying taxes.
Biden administration officials said after evaluating the practice that there are no economic grounds for these transactions, with Deputy Treasury Secretary Wally Adeyemo calling it “really just a shell game.” The officials said the additional IRS funding provided through the 2022 Inflation Reduction Act had enabled increased oversight and greater awareness of the practice.
“These tax shelters allow wealthy taxpayers to avoid paying what they owe,” IRS commissioner Danny Werfel said.
The officials said the additional IRS funding provided through the 2022 Inflation Reduction Act had enabled increased oversight and greater awareness of the practice.
Thank goodness for that!
And, yes, do it!
This is the way.
Indeed. Also, Republicans have already proposed dramatic cuts to the IRS, so we should be under no illusions about what will happen to this loophole and Direct File if Trump & Co. take control in November.
Every dollar invested in the IRS give more than that in taxes from cheaters. Worth it
Yeah, it’s a whopping 600% in general and DOUBLE that for auditing the top 10%!
If you’re for the government being fiscally responsible (rather than pretending that macroeconomic systems are identical to household budgets) you want rule changes like the one mentioned in the headline as well as more funding for auditing and other enforcement of existing IRS rules.
… for rich people.
Because historically it’s been the middle class and poor that get audited, never the rich.
In fact the IRS could just drop every investigation into those and focus on the rich every time.
I’m down for also investigating the upper middle class. Some small business owners are scummy tax cheats whose entire success rests on stealing wages from their workers and taxes from the government. They need to be put out of business to open up market share for honest companies.
I once worked for a multimillionaire who got audited. He did have to sell a bunch of properties, cars and other toys, to pay taxes, interest, and fines, and got ten years in the pen. This was in the nineties, and he was well-liked, but I never* heard, nor heard of, anyone claim it was unfair, including those who benefited from his corruption, except one guy who bought and sold particular high-end products for him who was also audited, and avoided prison, but idk whether he had to pay delinquent taxes, penalties and interest or not.
The IRS processed 162 million tax returns in FY 2023. If they raise $50 billion, then that means $308 for every taxpayer in America, courtesy of the IRS.
Honest taxpayers rejoice. Tax cheats, go cry about it.
Really it has no impact on most of us. I have never used a partnership tax basis shift and almost certainly never would have. It is going to cost a bunch of obscenely wealthy jerks some money and cost the rest of us nothing. Win-win.
That’s SOCIALISM!
-Fiscally Responsible Republicans who rely on Food Stamps.
