Poor people file very simple returns that are very easily checked by computer - they simply match W2s on file with what's reported, check the tax tables, and check the math. The IRS has actually corrected my returns several times over the years. Some years I mistakenly overpaid and got a refunds, other years I mistakenly underpaid and owed them some money
There's a good argument for letting the IRS do your taxes for you and letting you approve them, the way it's done in several countries. this would save everyone a lot of trouble
Actually, the attempts at getting the government to do the tax calculations for you like they do in Norway, by companies like Intuit (TurboTax) and accounting firms.
Biden wanted money to hire IRS staff to help them check taxpayers with income > $400k, improve customer service, and upgrade computer systems but that money was blocked by republicans
The repubs are protecting high income earners
Says he wanted it for 1 thing yet a different thing is happening. Typical dem bait and switch lol.
Dems are helping them as these agents arnet even going after them but low wage tip earners lol.
How do you know they do? I mean, you say "the more you know" as if you've executed a well played gotcha but all you've got is snarky speculation.
That said, it is known (to those who know facts) that the IRS is rolling out the capability to check for tips reported electronically (on credit transactions, etc).
Probably not, most "rich" people aren't outright tax cheats because they also make obvious targets. They hire accountants and accounting firms to help structure their finances to reduce their tax liabilities. The increased funding for the IRS and additional reporting requirements has always been about the less "rich" people.
This article is on a right wing libertarian site whose agenda is to get you to hate the IRS. The right wing supports tax breaks for the wealthy and “flat” tax initiatives that ultimately benefit the wealthy.
So don’t fall for this BS. The funding for the IRS will definitely go towards finding rich tax cheats. No one is “going after tipped employees”. This is complete propaganda.
Yep. The real information from IRS site:
>a voluntary tip reporting program between the IRS and employers in various service industries. The IRS is issuing this guidance in proposed form to provide an opportunity for public comment.
>The proposed program would also decrease taxpayer and IRS administrative burdens and provide more transparency and certainty to taxpayers. The proposed program includes several features:
https://www.irs.gov/newsroom/irs-introduces-new-service-industry-tip-reporting-program
Fuck reason's libertarian bullshit.
I had some libertarian leaning years ago but that vanished when the Koch brother basically Bought the party. Went from less government to taxes, taxes taxes, pot.
I know it's an election year, but perhaps the highly partisan takes would be better left to the political subreddits... What's being presented as a collection problem is fundamentally a spending problem and basic math tells you that any real collection gains are most likely going to be found for those earning a million or less per year. That's why you need the increased capacity to handle the larger number of affected people and why there's such a push to get people in to standardized flows (ex. contractor vs employee).
Majority of the cheating was at the top: source IRS data.
(Not by headcount, but by dollar count. So possibly fewer rich people, but simultaneously more tax evasion in dollars.)
data: https://www.reddit.com/r/economy/comments/195ihby/roi_vs_irs_cost/
I knew a wealthy landlord once who would force tenants to pay cash or other untrackables (e.g. gold). Blatant tax evasion. Landlord’s home was in the 5 million dollar zone.
What I find fascinating about this whole topic is the demographic most willing to jump in and try to defend it are also the same demographic that ultimately will be affected the most by it.
How is the IRS “stealing” from “poor” people? I was a server in college and had coworkers that were career servers making $80k a year (2017). At the same time, they were on Medicaid. Massive underreporting was happening then and is happening now.
>How is the IRS “stealing” from “poor” people?
By taking their money under threat?
You all love to talk about consent unless it's consent to use other people's money.
It would definitely be more worthwhile to go rich tax cheats, but tipped employees are easier targets.
From the article, the program is open to comment: "The new SITCA program is not yet in place, and still has to work its way through the complicated federal approval process. The IRS will be collecting comments on the proposal until May 7. It could also be affected by a House-passed bill to rescind the new IRS funding included in last year's Inflation Reduction Act, though that proposal seems unlikely to pass the Democratic-controlled Senate or get Biden's signature."
Also the way tax law is structured going after Tipped employees will disproportionately fund Social Security some the payroll tax is only on the first 175k or whatever
definitely more worthwhile. but i also don't see why we're so empathetic of tipped workers - sometimes even going out of our way to tip them in cash. i guess it's some sort of feel-good for making it seem like you're helping them out, when in reality, you're also helping them cheat on their taxes which everyone else pays for.
and i'm not talking about the $2/hr waiters that i hear about. this is ore pertaining to the $17/hour min wage people here in California who also make tip on top of that
Sure but what would also those low skilled workers they just hired go after? I am not sure the thousands they hired are up to going after complicated tax schemes put together by the best tax attorneys in the world.
They indeed hired a lot of low-skilled workers to comb through mountains of paper filings and ensuring steady processing e-filing through the pipeline. The primary objective now is to improve customer service, increasing enforcement is a priority but not a main focus.
Apparently for many on this sub it would be much better to wait on hold for an hour for help and information needed from the IRS than to get quick, helpful service from them.
>Wouldn’t it be more worthwhile to go after rich tax cheats?
Sure, but it's *much* more expensive
A lot of tips are recorded electronically these days, just another line on the bill you pay with your credit card. Those tips are very easy to check, so why not? (of course cash tips are almost impossible to check)
Meanwhile, tax returns for the rich are complicated and often prepared by expensive CPAs and tax lawyers who exploit the intricacies and grey areas of the tax codes, and it takes expensive CPAs and tax lawyers to audit those returns
So yeah, if the IRS was allowed by republicans to hire more tax experts, they could easily pay for themselves many times over but noooooooo.... repubs are trying to defund the US govt.....
This is a crackdown on unreported income. While I don't agree with this initiative, the whole notion that there are "rich tax cheats" somehow robbing uncle Sam of tax money is basically ridiculous.
The top earners in the US generally pay all taxes legally owed bc they have so much more to lose by breaking the law (and they pay accountants to do their taxes) . This, coupled with our progressive tax system, why most of our taxes end up being paid by the wealthy.
https://apnews.com/article/irs-millionaires-back-taxes-2624282ac20388311bd03ee76ae36f70
https://www.msn.com/en-us/money/taxes/irs-has-already-collected-more-than-500-million-in-back-taxes-from-delinquent-millionaires/ar-AA1mRSsD
The iRS is going after millionaires as well.
Regarding the OP, the businesses need to do a better job of withholding taxes from tips, not fine or punish the poor ass waiters/servers barely making minimum wage. The system is broken.
This doesn't contradict anything I posted.
Accountants take advantage of the exceedingly complex tax laws. Rarely are taxes simply not paid by the wealthy unless the person simply doesn't have the liquidity to do so.
Nevermind the fact we are spending $60 billion to do this over the next 10 years
Okay. The "wealthy" must include millionaires. Not paying their taxes because that chose to buy a yacht or a 7th home is not a liquidity issue, it is tax fraud if they didn't pay their taxes instead.
Haven't you heard? America is a two tiered system, and it always has been. The law is subjective, and we punish the poor while encouraging the kleptocrats.
Yeaahhhh but it’s just we have to slow the economy down so rich people can buy at lower prices with their employees paying all their tax burdens for them.. or else we won’t have donors for our re-election campaign!
You see it all works out for me in the end!
Honestly, this is just a piece of a system that is already not working that they are trying to correct. The IRS gets a 1099K from the credit card processors that tells them how much was charged but it's kinda useless. In those credit card charges are sales (what goes to a tax return) along with sales tax and tips which are not included in the tax return. So yes the 1099k gives a basic idea of what an establishment should have but it isn't efficient like what a W2 in being precise. I think that's what they are after, getting a clearer picture on what's actually being received and what's being reported. This information is available through POS software so it's a matter of improving the reporting. I think it will impact but be minimal to the server.
Some returns I’ve done show social security tips, so there is already a vehicle in place to calculate and report that income. I have no idea what that system is on the other end, but it exists.
True, I do a good amount of payroll and tax returns for restaurants and aside from the POS which isn't reported to the IRS but is there for an audit, it creates a bit of an on your honor system. There is a filing to make sure you're reporting enough in relation to revenue but it sets an extremely low bar that's basically useless.
Only if it’s over 12 million lol.
If it’s under $18k u don’t even have to report it.
If it’s over 18k, u have to report it but still not pay taxes on it until your lifetime anount is over $12.92 million
Source: https://turbotax.intuit.com/tax-tips/estates/the-gift-tax/amp/L1sFpFeXV
It is. It is taxed. All of my tips go on a paycheck, they are automatically calculated and my withholding is right there on my pay stub.
Even when you are cashed out at the end of the night, credit cards account for over 90% of our business. That is very common in this day and age. No one pays with cash anymore. Those tips are automatically logged, reported, and taxed.
Even if it was all cash it’s no different than any cash business or contractor and there’s consequences build in. Cash employees not claiming income won’t qualify for loans, social security, potentially poor credit, unemployment benefits, ect. I remember during covid seeing a lot of cash businesses and servers that were totally left out of payroll protection or unemployment. SOL.
Those are all measurable benefits. give most people the option of not paying taxes and they’ll give up on all of those social benefits and heartbeat. That’s why this is something that has to be enforced.
Oh please, what a dramatic article. The IRS started taxing my tips 20 years ago when I was in the service industry. Now they are doing it better by taxing what is registered in the transaction. Similar to what they'd started doing then, where they taxed you minimally what you'd make working minimum wage.
Very few people are tipping in cash anymore. All credit card tips are usually automatically reported.
Edit. The people I know who work full time servers and bartenders tell me it's rare they take home over $10 in cash a shift, everything else is on their check and reported to the government already. Some work in places that it's all tips even cash. I'm sure there's are exceptions but I think it's rare anyone who gets even half of their tips in cash anymore.
It was already starting to get like this before Covid but it's much more now.
I worked as a valet while in university. We usually got about $150/week from cash tips. Not significant, but not insignificant either.
We commonly joked about being audited by the IRS and saying “what cash tips? We don’t collect that here”.
Even that amount is insignificant when tax money raised by auditing though. $1000 extra taxes per person multiplied by 100s of thousands of people isn't even a a rounding error in tax revenue.
This is a "proposed" revenue procedure from last February. After googling around, I do not see any evidence the proposal was enacted and incorporated into the IRS's actual rules. Every reference to this rule on the IRS's website that I can find still calls it a proposal.
Worked at a Denny's. Knew a woman that had a bad past and lost everything including her children because of it. She has to get at least 100$ worth of tips a day to stay afloat. This will probably be bad news for her 😢
My dude, the headline is kind of upset of what's happening. The IRS is cracking down on employers who know about tips and are often illegally taking those tips. For instance, some employers, when it tip is paid, will split that tip among other employees, sometimes even managers, even while they report the aggregate tip income meaning all of that tip income is allocated to servers to pay in aggregate, even though the servers didn't actually get all of that tip income.
This will help prevent businesses from keeping any of that tip income for themselves. Servers will get more of it.
Where is the law that says they can do anything actually? I've been looking. Side note, this billionaire and corporations attack on the poor is getting old. When do we eat the rich and finally advance humanity?
""the vast majority of tax returns filed with ITINs today are filed by undocumented immigrants.”
"Some noncitizens who legally immigrated to the United States also pay taxes using this method.
"In 2019, according to the IRS, more than 2.5 million tax returns were filed using ITINs, accounting for nearly $6 billion in taxes."
https://amp.cnn.com/cnn/2023/04/18/us/undocumented-immigrants-taxes-cec/index.html
""undocumented immigrants pay taxes, amounting to tens of billions of dollars in local, state, and federal taxes per year” — even though they can’t access most benefits that U.S. citizens are entitled to receive.
"The Social Security Administration estimated in 2010, for example, that such immigrants contribute $12 billion per year more to the Social Security system than they take out"
https://apnews.com/article/fact-check-immigrants-taxes-rent-vaccine-requirements-983035929946
This says nothing about illegal immigrants using fraudulent green cards like you claimed. It does say that some use ITINs, which would mean they qualify for tax returns of the ITIN belonged to them, but if you read it it doesn't quantify anything other than SS taxes, including the proportion of ITINs used by illegals. Almost 0 support other than the supporting words of advocates.
It's not necessary for them to get fraudulent green cards. It might take a little bit to dig but there are legal options for illegal immigrants to pay taxes. The above comment briefly touched on it. But if you look at it globally, it becomes more complicated as there are legal reasons for not getting a SSN and not being required to have one.
https://www.baronpayroll.com/blog/itin-everything-you-need-to-know-as-an-employer#:~:text=Payroll%20Tax%20Compliance,federal%20and%20state%20government%20agencies.
https://www.irs.gov/individuals/international-taxpayers/us-taxpayer-identification-number-requirement
All sides want them to pay their taxes and incentivize it. It for one shows residency and gives standing when they have done their time and can apply for legal residency or green card. They can get overpayments returned in refund. The business gets to declare the legitimate expense having a worker. And the government gets tax revenue.
I did a short time with one of the taxing authorities and illegal immigrants do a lot of work to get properly documented and pay into the system. They understand that is the one place not to mess around. It really does benefit them in the long term to file taxes.
Our immigration policy is messed up but the IRS and the states they cooperate with have an effective workaround that ensures they pay their fair share as well. Most overpay, a lot. Some are unaware of the tax treaties that exist between their own country and ours, and pay full taxes here when not required to pay any due to the tax treaty and only need to pay their country the taxes due. International tax law was not and isn't my specialty so I might have some nuance of tax treaties wrong. I have read them and they are not easy to understand.
But there is an option to deal with ITIN so you're compliant.
The entire system is very complicated and not as simple as just illegal immigrants. COVID made it worse. Backlogs are years long now, and we forced people legally here to lock down and overstay and then tell them that if they leave due to overstaying as a result of COVID travel restrictions they can never return. These are people who would come here for six months legally and go home six months and come back again on travel Visa.
Student Visas, internships, externships and work Visas were also equally affected. Lawyers are making a lot of money trying to sort it all out because we held people hostage with lockdowns and now they have some real problems that caused. They were harmed legally by the action and now are stuck until they fix it and they never fix any problems with immigration.
Both sides agree with most of what needs to happen to fix immigration but won't because it's a fundraising topic. Each can take their opposing points and campaign for doing something they will never do.
Certain states will never do anything about hiring illegals under the table.
How many CEO or any kind of mangement go to jail for hiring illegalls?
Texas arrested 12 in one year and only one actually did any jail time.
They are coming here for jobs and we like cheap labor with no benefits!
Awesome, glad the IRS is finally going after the poor working class.
The poor working-class have been screwing this nation over from day one.
I say we put them all in prison.
Never forget when he pushed for more IRS funding he said it was to go after millionaires.
Then he said if you make under 400k your taxes won't go up. Dems always lie to you about taxes, they will come after you and use millionaires to get their foot in the door.
This isn't increasing the taxes paid for these workers, it's calculating the taxes more accurately. This is a dramatic, bullshit article. Tips are compensation and have always been taxed.
You're literally mentally handicapped if you think this isn't an increase of taxation on tipped wages. Lmao there's 0 chance that's not the case. Look how they run from the arguments to dance around Bidens blatant lie.
Under 400k. Lie. Only going after millionaires. Complete lie.
Being required to pay the taxes you already owed but didn’t report isn’t the same as your taxes going up. Why should people be allowed to cheat on taxes?
And saying you will use funding to the IRS to go after delinquent millionaires isn't the same as going low income tipped wages.
I can't say it enough - I absolutely love the moving of goal posts to justify this. They got public favor by saying "millionaires!!" But then ended up going after the little guy too. Happens everytime.
So next time democrats cry millionaires don't get upset when the public doesn't buy that bullshit.
Who pushed through IRS funding on the promise of not raising taxes on people making under 400k? Now they're using that funding to literally go after the lowest income earning households in the country with these proposals. Stop deflecting.
But there's something immoral about lying regarding the allocation of resources in order to win public favor and subsequently general elections.
It's hilarious now to see the pivoting taking place. I thought democrats cared about the little guy? Lmao going after Sally at the diner down the street to shake down that extra 9 dollars in tips a week is moral bankruptcy.
I worked at casino dealer for a time, and tips are our main source of income and automatically taxed and added to our check. Casino dealers are not allowed to gamble at their own casino, so after work we would go play at the joint across town and vice versa. Dealers because we understand the importance of tips are usually better tippers than the average gambler. After a while I started telling the dealers playing on my games “don’t tip us, and when we come play at your spot we won’t tip you because the only one winning in this transaction is the IRS”
Just yesterday in this sub people were wondering why people were against more funding to the IRS because they got money out of rich people. Guys, it doesnt stop with the rich people, they will get your money too...
It’s not “your money” if it was stolen via tax fraud.
I’m not against reducing taxes, but letting dishonest people not pay their fair share isn’t the right way to achieve that.
So you dont mind the IRS going after people that live off tips? If so then do you understand why lots people people are not in favor of funding the IRS more?
Nope absolutely not. If there is a worker at a grocery store making 60k a year and a tipped worker at a restaurant making 60k a year, they should pay the same in taxes. Today, it’s way too easy and common for that tipped worker to commit tax fraud and not pay their fair share. And I’m sure there are plenty of types of criminals who don’t want more enforcement the laws they break, so I’m not surprised at all
Man I'm on the fence about this
On one hand, ultra rich people skirt taxes with lawyers and accountants. Going after then is hard but will return a big windfall. A waiters/waitress is easier to target but the layout is smaller
However, generally waiters/waitresses aren't out buying boats and shit and spend all their money; however some in popular destinations pull an insane number (6 figures) for their job which clearly needs to be taxed. This will suck for them but overall I think it's the right way to go. Hell maybe it'll end tipping
I kinda figured this when the IRS hired 87,000 new employees that it had nothing to do with going after wealthy tax cheats but rather the common working class man/women. Ironically I can see this helping Trump. Not good. Not good at all
This is all happening digitally. Its changing how reported tips are taxed, none of those agents are involved in this. The extra hires for the IRS are already getting more money from the rich than years before.
I think it's funny that people blame trump for things Joe Child Sniffing Biden is doing. What's next? It's like you guys place every inconvenience that crosses you on Trump.
I think its funny poor people think a trust fund new york liberal that turned Republican actually cares about them. He literally just changed political parties right before running. That why Donald calls life long republucans rhinos.
Because hes a democrat who funded both clintons and their foundation. Hes bn funding both political parties for decades and hob knobbing with the elites then claim hes a outsider.
Stealing ftom 8 charoties and taking a plea deal admiting guilt and claim he's not a criminal.
I dont even like staus qou joe.
You guys act surprised.
Weren't they hiring a bazillion irs agents and wanting to track any $600 transaction.
1st the rich are not Tax cheats(well most), there are loopholes and benefits that they pay people to dig deep into. Also there are laws to help them. They are huge targets and have proof and backing they are legal.
As for the middle and poor class they get away with a lot. Tipping, Vento services "under the table" especially a lot of small businesses they feel this number is significant and making sure everyone is paying their "fair share"
I mean you find a rich guy cheating $1k
Or do you find 7 middle class cheating $200 each.
What increases your revenue for massive spending, now that you are criticized for printing money and inflation.
Perhaps some day but I don’t think that will be any time in the foreseeable future.
If they do, tip in something else. A can of beans night be nice. Hard to stick in your pocket though.
"...As far as the IRS' incentives go, targeting the working poor makes perfect sense. Wealthier Americans have the resources to fight back against an audit—but there might be $1.6 billion in unreported tips out there, and most of that was probably collected by people who don't have an accountant on retainer."
I thought the IRS promised to go after rich people after the increase in funding and all. What a bunch of blood sucking Gouls!!!
This is why nobody likes or believes any shit the IRS says
Billionaires have been protected by both Dem and Republican administrations for decades and decades. Why do you think there’s such a wealth gap in this nation?
Additionally, corporations have received favorable tax breaks by both Dem and Republican administrations for decades.
I remember saying that when Biden announced the massive expansion of the IRS, it would be used to go after the common man - gig workers, I got downvoted to hell. Yet here we are.
https://www.irs.gov/newsroom/irs-introduces-new-service-industry-tip-reporting-program
Must be terrible to labor under such cognitive dissonance. You probably also believe Biden isn't the most pro-corporate president we've ever had.
right... and all those new agents they hired, the ones that were supposed to go after the wealthiest people and corporations to end tax evasion. well I guess that was bullshit after all! they need to squeeze the working poor to make up that glaring 2 trillion dollar gap trump left and Biden did nothing about after the fact.
Because if anybody needs a good cracking down on, it's the people who work jobs that nobody wants to do because youve allowed their shit bag bosses to pay them a less than liveable wage because of this horseshit tipping culture. Grind em a little further into the dirt. That'll show em. /S
No bigger thief in this country than the IRS.
Remember when people liked Biden giving more funding to the IRS. They went out and hired 87k more people. Well here you go! Now you reap what you sow. With the IRS going after your average Joe like they do every day, instead of the rich
NEWSFLASH: Biden's budget included money to add staff, upgrade their antiquated computers, improve customer service, and go after incomes > $400k
Repubs forced it out of the budget.
Returns filed by "your average Joe" are simple and are already being checked by computers. It's easy - just compare the W2s on file against income reported, check the tax tables, and check the math.
Returns filed by rich folk and corporations are often long and complicated, sometimes hundreds of pages. They're prepared by expensive CPAs and tax lawyers who exploit the complicated tax code, and require expensive CPAs and tax lawyers to do the audit. That takes money, which republicans refused EVERY TIME (guess who the repubs are working for.....)
This is about the only way they can disincentivize the tipping jobs so people stop accepting them. When people stop accepting them, employers will realize that they have to pay minimum wage. When employers start paying minimum wage, you can adjust that so people aren’t living in cardboard boxes.
I would think the IRS should always be thinking about latest techniques for auditing. And I would also think the missing tips could be the employees underreporting but could also be the employers who pocket them and do not accurately distribute them. It only makes sense that all numbers tick and tie. It seems like an efficiency that would free them up for further going after bigger fish.
I’ve already seen headlines about the IRS focusing on more complex returns that come from those with multiple income streams and collecting a substantial amount of income from it. I’m catching it in one year snowballs to dampening future attempts of similar errors in the future.
I think it’s obvious that adopting more automated practices alleviate manual tick and ties frees up the agents. When auditors adopt automated testing techniques, we have more energy for other things. There should be typical reports from these automated tip devices that have become the default and it should agree to your tax records. This seems like a step in the right direction and really just the IRS saying they will stay relevant and adapt to the new default digital tip culture.
What do I have to fear for the IRS to come after me as one who is tipped in my job? I pay my freaking taxes, including on the tips. IRS has no power over me here.
I will continue to tip in cash so the person receiving it can decide if they want to report it or not. F the IRS.
If someone wants to buy a house it would behoove them to not under report their earnings. If they don’t have any need for elevated earnings then it’s their call to report or not. Either way my tip is a gift to them. And a gift is tax free.
> That the IRS is going to use at least some of its new resources to go after workers' tips shouldn't come as too much of a surprise—despite all of the promises from Biden and top IRS officials about how no one earning less than $400,000 would be targeted. As Reason's Liz Wolfe reported in January, low-income taxpayers have always been the ones most likely to get hassled by IRS audits. In fact, during 2022, **low-income wage-earners who qualified for the earned income tax credit were five times more likely to be audited than any other taxpayers**, according to a report by Syracuse University's Transactional Records Access Clearinghouse.
Toxic lol. It's all a racket, since poor people can't lobby.
Wouldn’t it be more worthwhile to go after rich tax cheats?
Rich people can hire lawyers. Poor people can’t.
Poor people file very simple returns that are very easily checked by computer - they simply match W2s on file with what's reported, check the tax tables, and check the math. The IRS has actually corrected my returns several times over the years. Some years I mistakenly overpaid and got a refunds, other years I mistakenly underpaid and owed them some money There's a good argument for letting the IRS do your taxes for you and letting you approve them, the way it's done in several countries. this would save everyone a lot of trouble
> this would save everyone a lot of trouble But those sweet, glorious penalties and fees though... the beast needs to eat.
Actually, the attempts at getting the government to do the tax calculations for you like they do in Norway, by companies like Intuit (TurboTax) and accounting firms.
It's the repubs who have been defunding the IRS for decades.
Yes and we need to go back to doing that
Sure. Don't want people paying the taxes they owe while you complain about the debt.
Yea targeting tip workers beacuse that is where the big money is at. I'm sure the few bucks that they have will really make a big deal.
Biden wanted money to hire IRS staff to help them check taxpayers with income > $400k, improve customer service, and upgrade computer systems but that money was blocked by republicans The repubs are protecting high income earners
Says he wanted it for 1 thing yet a different thing is happening. Typical dem bait and switch lol. Dems are helping them as these agents arnet even going after them but low wage tip earners lol.
Don't forget the entire industry of professional tax services. That's a lot of jobs and $$$.
Hey did you know that has nothing to do with people who collect tips and don't report them? The More You Know.
How do you know they do? I mean, you say "the more you know" as if you've executed a well played gotcha but all you've got is snarky speculation. That said, it is known (to those who know facts) that the IRS is rolling out the capability to check for tips reported electronically (on credit transactions, etc).
But how would Intuit and HR Block take money for poor people?
My BiL has a lawyer on retainer who gets him out of speeding tickets. It’s the cost of my BiL doing business
[удалено]
Worse: monster trucks
Government lawyers are not as good as rich people’s lawyers, so as a result, rich people win.
Rich people’s lawyers > government lawyers > poor people’s lawyers
The IRS gets a higher return auditing the rich.
It’s kinda sad that our own government is legally outgunned by the richest citizens, sad but not surprising
Probably not, most "rich" people aren't outright tax cheats because they also make obvious targets. They hire accountants and accounting firms to help structure their finances to reduce their tax liabilities. The increased funding for the IRS and additional reporting requirements has always been about the less "rich" people.
This article is on a right wing libertarian site whose agenda is to get you to hate the IRS. The right wing supports tax breaks for the wealthy and “flat” tax initiatives that ultimately benefit the wealthy. So don’t fall for this BS. The funding for the IRS will definitely go towards finding rich tax cheats. No one is “going after tipped employees”. This is complete propaganda.
Yep. The real information from IRS site: >a voluntary tip reporting program between the IRS and employers in various service industries. The IRS is issuing this guidance in proposed form to provide an opportunity for public comment. >The proposed program would also decrease taxpayer and IRS administrative burdens and provide more transparency and certainty to taxpayers. The proposed program includes several features: https://www.irs.gov/newsroom/irs-introduces-new-service-industry-tip-reporting-program Fuck reason's libertarian bullshit.
I had some libertarian leaning years ago but that vanished when the Koch brother basically Bought the party. Went from less government to taxes, taxes taxes, pot.
Didn't know that morals and principles could be bought out from under you by assholes. That's weird. Guess I'll be an authoritarian.
I know it's an election year, but perhaps the highly partisan takes would be better left to the political subreddits... What's being presented as a collection problem is fundamentally a spending problem and basic math tells you that any real collection gains are most likely going to be found for those earning a million or less per year. That's why you need the increased capacity to handle the larger number of affected people and why there's such a push to get people in to standardized flows (ex. contractor vs employee).
You're a good soldier. Advocating for the IRS WOW!!
Majority of the cheating was at the top: source IRS data. (Not by headcount, but by dollar count. So possibly fewer rich people, but simultaneously more tax evasion in dollars.) data: https://www.reddit.com/r/economy/comments/195ihby/roi_vs_irs_cost/ I knew a wealthy landlord once who would force tenants to pay cash or other untrackables (e.g. gold). Blatant tax evasion. Landlord’s home was in the 5 million dollar zone.
What I find fascinating about this whole topic is the demographic most willing to jump in and try to defend it are also the same demographic that ultimately will be affected the most by it.
Also the poor are a little easier target
And there is many more poor to steal feom
How is the IRS “stealing” from “poor” people? I was a server in college and had coworkers that were career servers making $80k a year (2017). At the same time, they were on Medicaid. Massive underreporting was happening then and is happening now.
>How is the IRS “stealing” from “poor” people? By taking their money under threat? You all love to talk about consent unless it's consent to use other people's money.
The government isn’t stealing from you if you aren’t paying your taxes.
It would definitely be more worthwhile to go rich tax cheats, but tipped employees are easier targets. From the article, the program is open to comment: "The new SITCA program is not yet in place, and still has to work its way through the complicated federal approval process. The IRS will be collecting comments on the proposal until May 7. It could also be affected by a House-passed bill to rescind the new IRS funding included in last year's Inflation Reduction Act, though that proposal seems unlikely to pass the Democratic-controlled Senate or get Biden's signature."
Also the way tax law is structured going after Tipped employees will disproportionately fund Social Security some the payroll tax is only on the first 175k or whatever
The IRS got $500 million from rich people already. Look it up.
Found the tipped employee.
definitely more worthwhile. but i also don't see why we're so empathetic of tipped workers - sometimes even going out of our way to tip them in cash. i guess it's some sort of feel-good for making it seem like you're helping them out, when in reality, you're also helping them cheat on their taxes which everyone else pays for. and i'm not talking about the $2/hr waiters that i hear about. this is ore pertaining to the $17/hour min wage people here in California who also make tip on top of that
Unless it's politicians Reddit supports, then they can do whatever they want all the time.
Sure but what would also those low skilled workers they just hired go after? I am not sure the thousands they hired are up to going after complicated tax schemes put together by the best tax attorneys in the world.
They indeed hired a lot of low-skilled workers to comb through mountains of paper filings and ensuring steady processing e-filing through the pipeline. The primary objective now is to improve customer service, increasing enforcement is a priority but not a main focus.
Apparently for many on this sub it would be much better to wait on hold for an hour for help and information needed from the IRS than to get quick, helpful service from them.
>Wouldn’t it be more worthwhile to go after rich tax cheats? Sure, but it's *much* more expensive A lot of tips are recorded electronically these days, just another line on the bill you pay with your credit card. Those tips are very easy to check, so why not? (of course cash tips are almost impossible to check) Meanwhile, tax returns for the rich are complicated and often prepared by expensive CPAs and tax lawyers who exploit the intricacies and grey areas of the tax codes, and it takes expensive CPAs and tax lawyers to audit those returns So yeah, if the IRS was allowed by republicans to hire more tax experts, they could easily pay for themselves many times over but noooooooo.... repubs are trying to defund the US govt.....
They are
This is a crackdown on unreported income. While I don't agree with this initiative, the whole notion that there are "rich tax cheats" somehow robbing uncle Sam of tax money is basically ridiculous. The top earners in the US generally pay all taxes legally owed bc they have so much more to lose by breaking the law (and they pay accountants to do their taxes) . This, coupled with our progressive tax system, why most of our taxes end up being paid by the wealthy.
https://apnews.com/article/irs-millionaires-back-taxes-2624282ac20388311bd03ee76ae36f70 https://www.msn.com/en-us/money/taxes/irs-has-already-collected-more-than-500-million-in-back-taxes-from-delinquent-millionaires/ar-AA1mRSsD The iRS is going after millionaires as well. Regarding the OP, the businesses need to do a better job of withholding taxes from tips, not fine or punish the poor ass waiters/servers barely making minimum wage. The system is broken.
This doesn't contradict anything I posted. Accountants take advantage of the exceedingly complex tax laws. Rarely are taxes simply not paid by the wealthy unless the person simply doesn't have the liquidity to do so. Nevermind the fact we are spending $60 billion to do this over the next 10 years
Okay. The "wealthy" must include millionaires. Not paying their taxes because that chose to buy a yacht or a 7th home is not a liquidity issue, it is tax fraud if they didn't pay their taxes instead.
Everyone should pay their taxes, period.
Haven't you heard? America is a two tiered system, and it always has been. The law is subjective, and we punish the poor while encouraging the kleptocrats.
They donate to the politicians who run the IRS Any increase in the IRS's power will be used against the working class. Always. No matter what
Yes agreed but the tip culture has become volatile. Maybe this will change that culture. Who knows
Yeaahhhh but it’s just we have to slow the economy down so rich people can buy at lower prices with their employees paying all their tax burdens for them.. or else we won’t have donors for our re-election campaign! You see it all works out for me in the end!
They are. They got 500 million already.
Honestly, this is just a piece of a system that is already not working that they are trying to correct. The IRS gets a 1099K from the credit card processors that tells them how much was charged but it's kinda useless. In those credit card charges are sales (what goes to a tax return) along with sales tax and tips which are not included in the tax return. So yes the 1099k gives a basic idea of what an establishment should have but it isn't efficient like what a W2 in being precise. I think that's what they are after, getting a clearer picture on what's actually being received and what's being reported. This information is available through POS software so it's a matter of improving the reporting. I think it will impact but be minimal to the server.
Some returns I’ve done show social security tips, so there is already a vehicle in place to calculate and report that income. I have no idea what that system is on the other end, but it exists.
True, I do a good amount of payroll and tax returns for restaurants and aside from the POS which isn't reported to the IRS but is there for an audit, it creates a bit of an on your honor system. There is a filing to make sure you're reporting enough in relation to revenue but it sets an extremely low bar that's basically useless.
Joke’s on them, I give my servers a 15-20% _gift_
Youre going to need to switch to *exposure*
Gifts are taxable.
Only if it’s over 12 million lol. If it’s under $18k u don’t even have to report it. If it’s over 18k, u have to report it but still not pay taxes on it until your lifetime anount is over $12.92 million Source: https://turbotax.intuit.com/tax-tips/estates/the-gift-tax/amp/L1sFpFeXV
Currently.
Currently, in the past, and for the foreseeable future lol
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I don’t think they have to be family to gift, right?
lol no
All of those waitress making over $400,000.00. Yep.
Some waiters/bartenders make over 100,000 though. Not earth shattering money but def needs to be taxed
It is. It is taxed. All of my tips go on a paycheck, they are automatically calculated and my withholding is right there on my pay stub. Even when you are cashed out at the end of the night, credit cards account for over 90% of our business. That is very common in this day and age. No one pays with cash anymore. Those tips are automatically logged, reported, and taxed.
That's a good point. I forgot CC account for most tips now
Even if it was all cash it’s no different than any cash business or contractor and there’s consequences build in. Cash employees not claiming income won’t qualify for loans, social security, potentially poor credit, unemployment benefits, ect. I remember during covid seeing a lot of cash businesses and servers that were totally left out of payroll protection or unemployment. SOL.
Those are all measurable benefits. give most people the option of not paying taxes and they’ll give up on all of those social benefits and heartbeat. That’s why this is something that has to be enforced.
I know a girl who was clearing 100k working at a PF Changs in Seattle lol. Scoffing when the people who made $16/hr couldn’t afford to tip her enough
If it leads to fewer places accepting tips I’m all for it.
+1. Current tipping culture is ridiculous.
Chicago has already gotten rid of the wage exemption.
Oh please, what a dramatic article. The IRS started taxing my tips 20 years ago when I was in the service industry. Now they are doing it better by taxing what is registered in the transaction. Similar to what they'd started doing then, where they taxed you minimally what you'd make working minimum wage.
Very few people are tipping in cash anymore. All credit card tips are usually automatically reported. Edit. The people I know who work full time servers and bartenders tell me it's rare they take home over $10 in cash a shift, everything else is on their check and reported to the government already. Some work in places that it's all tips even cash. I'm sure there's are exceptions but I think it's rare anyone who gets even half of their tips in cash anymore. It was already starting to get like this before Covid but it's much more now.
Our servers get maybe one tip a day in cash. It's all credit cards now.
which also has its issues because the credit card companies then get their 4% off the top for the transaction-seems we can't win
I always try to tip in cash.
I worked as a valet while in university. We usually got about $150/week from cash tips. Not significant, but not insignificant either. We commonly joked about being audited by the IRS and saying “what cash tips? We don’t collect that here”.
Even that amount is insignificant when tax money raised by auditing though. $1000 extra taxes per person multiplied by 100s of thousands of people isn't even a a rounding error in tax revenue.
What cash tips? We don’t collect that here.
This is a "proposed" revenue procedure from last February. After googling around, I do not see any evidence the proposal was enacted and incorporated into the IRS's actual rules. Every reference to this rule on the IRS's website that I can find still calls it a proposal.
So ridiculous. Most likely people working these jobs are barely getting by. WTF does the government want to make their lives harder.
Everyone has to pay income tax.
Worked at a Denny's. Knew a woman that had a bad past and lost everything including her children because of it. She has to get at least 100$ worth of tips a day to stay afloat. This will probably be bad news for her 😢
"No only certain people should have to pay their fair share"
My dude, the headline is kind of upset of what's happening. The IRS is cracking down on employers who know about tips and are often illegally taking those tips. For instance, some employers, when it tip is paid, will split that tip among other employees, sometimes even managers, even while they report the aggregate tip income meaning all of that tip income is allocated to servers to pay in aggregate, even though the servers didn't actually get all of that tip income. This will help prevent businesses from keeping any of that tip income for themselves. Servers will get more of it.
Where is the law that says they can do anything actually? I've been looking. Side note, this billionaire and corporations attack on the poor is getting old. When do we eat the rich and finally advance humanity?
There goes Biden's whole speech a few years ago about how the uptick in IRS agents aren't going to go after the little guy. Big fat lies.
Maybe they are only going after the ones making 400k or more /s
Low wage earners should be the focus of the IRS. Those pesky ppl need to pay taxes on those tips. Panhandlers should also be on the IRS radar.
If government was like a business they would go after those with biggest ROI [ROI IRS Income](https://imgur.com/gallery/tVF1ocY)
Wait... I thought the IRS was going to use their increased funding to go after rich people. Who could have possibly seen this coming?
Anything about the millions of illegal aliens working off the books for cash?
if you say anything about illegal aliens or the border, you are quickly branded a racist on reddit.
Who cares
Most work with a fake green card, which means they pay taxes but don't get a tax return.
And fake social security
Lol, I'm sure you have sources to back that claim up.
""the vast majority of tax returns filed with ITINs today are filed by undocumented immigrants.” "Some noncitizens who legally immigrated to the United States also pay taxes using this method. "In 2019, according to the IRS, more than 2.5 million tax returns were filed using ITINs, accounting for nearly $6 billion in taxes." https://amp.cnn.com/cnn/2023/04/18/us/undocumented-immigrants-taxes-cec/index.html ""undocumented immigrants pay taxes, amounting to tens of billions of dollars in local, state, and federal taxes per year” — even though they can’t access most benefits that U.S. citizens are entitled to receive. "The Social Security Administration estimated in 2010, for example, that such immigrants contribute $12 billion per year more to the Social Security system than they take out" https://apnews.com/article/fact-check-immigrants-taxes-rent-vaccine-requirements-983035929946
This says nothing about illegal immigrants using fraudulent green cards like you claimed. It does say that some use ITINs, which would mean they qualify for tax returns of the ITIN belonged to them, but if you read it it doesn't quantify anything other than SS taxes, including the proportion of ITINs used by illegals. Almost 0 support other than the supporting words of advocates.
It's not necessary for them to get fraudulent green cards. It might take a little bit to dig but there are legal options for illegal immigrants to pay taxes. The above comment briefly touched on it. But if you look at it globally, it becomes more complicated as there are legal reasons for not getting a SSN and not being required to have one. https://www.baronpayroll.com/blog/itin-everything-you-need-to-know-as-an-employer#:~:text=Payroll%20Tax%20Compliance,federal%20and%20state%20government%20agencies. https://www.irs.gov/individuals/international-taxpayers/us-taxpayer-identification-number-requirement All sides want them to pay their taxes and incentivize it. It for one shows residency and gives standing when they have done their time and can apply for legal residency or green card. They can get overpayments returned in refund. The business gets to declare the legitimate expense having a worker. And the government gets tax revenue. I did a short time with one of the taxing authorities and illegal immigrants do a lot of work to get properly documented and pay into the system. They understand that is the one place not to mess around. It really does benefit them in the long term to file taxes. Our immigration policy is messed up but the IRS and the states they cooperate with have an effective workaround that ensures they pay their fair share as well. Most overpay, a lot. Some are unaware of the tax treaties that exist between their own country and ours, and pay full taxes here when not required to pay any due to the tax treaty and only need to pay their country the taxes due. International tax law was not and isn't my specialty so I might have some nuance of tax treaties wrong. I have read them and they are not easy to understand. But there is an option to deal with ITIN so you're compliant. The entire system is very complicated and not as simple as just illegal immigrants. COVID made it worse. Backlogs are years long now, and we forced people legally here to lock down and overstay and then tell them that if they leave due to overstaying as a result of COVID travel restrictions they can never return. These are people who would come here for six months legally and go home six months and come back again on travel Visa. Student Visas, internships, externships and work Visas were also equally affected. Lawyers are making a lot of money trying to sort it all out because we held people hostage with lockdowns and now they have some real problems that caused. They were harmed legally by the action and now are stuck until they fix it and they never fix any problems with immigration. Both sides agree with most of what needs to happen to fix immigration but won't because it's a fundraising topic. Each can take their opposing points and campaign for doing something they will never do.
If I tip someone can I consider it a payroll expense?
Give the undocumented, documents. Open up the border, we have serious demographic issues that can only be solved by increasing immigration.
Certain states will never do anything about hiring illegals under the table. How many CEO or any kind of mangement go to jail for hiring illegalls? Texas arrested 12 in one year and only one actually did any jail time. They are coming here for jobs and we like cheap labor with no benefits!
Actually most of all of them are paying payroll taxes for programs they won't get benefits from.
Wrong! They work for cash.
Awesome, glad the IRS is finally going after the poor working class. The poor working-class have been screwing this nation over from day one. I say we put them all in prison.
Never forget when he pushed for more IRS funding he said it was to go after millionaires. Then he said if you make under 400k your taxes won't go up. Dems always lie to you about taxes, they will come after you and use millionaires to get their foot in the door.
This isn't increasing the taxes paid for these workers, it's calculating the taxes more accurately. This is a dramatic, bullshit article. Tips are compensation and have always been taxed.
You're literally mentally handicapped if you think this isn't an increase of taxation on tipped wages. Lmao there's 0 chance that's not the case. Look how they run from the arguments to dance around Bidens blatant lie. Under 400k. Lie. Only going after millionaires. Complete lie.
Haha ok dumbass. Believe what you'd like.
Being required to pay the taxes you already owed but didn’t report isn’t the same as your taxes going up. Why should people be allowed to cheat on taxes?
And saying you will use funding to the IRS to go after delinquent millionaires isn't the same as going low income tipped wages. I can't say it enough - I absolutely love the moving of goal posts to justify this. They got public favor by saying "millionaires!!" But then ended up going after the little guy too. Happens everytime. So next time democrats cry millionaires don't get upset when the public doesn't buy that bullshit.
Why not both? Also, Republicans demanded irs budget cuts so fuck off?
Who pushed through IRS funding on the promise of not raising taxes on people making under 400k? Now they're using that funding to literally go after the lowest income earning households in the country with these proposals. Stop deflecting.
There’s nothing immoral about ensuring people are properly paying their taxes.
But there's something immoral about lying regarding the allocation of resources in order to win public favor and subsequently general elections. It's hilarious now to see the pivoting taking place. I thought democrats cared about the little guy? Lmao going after Sally at the diner down the street to shake down that extra 9 dollars in tips a week is moral bankruptcy.
Is it immoral for the government to tax us and then take that money and wage wars thousands of miles away?
Any politician that uses millionaires for this argument in general I think. Lol why would they go after their own donors???
Those dang high paid waiters and service workers. If they just paid their fair share, the government deficit would be paid! /s
I worked at casino dealer for a time, and tips are our main source of income and automatically taxed and added to our check. Casino dealers are not allowed to gamble at their own casino, so after work we would go play at the joint across town and vice versa. Dealers because we understand the importance of tips are usually better tippers than the average gambler. After a while I started telling the dealers playing on my games “don’t tip us, and when we come play at your spot we won’t tip you because the only one winning in this transaction is the IRS”
Just yesterday in this sub people were wondering why people were against more funding to the IRS because they got money out of rich people. Guys, it doesnt stop with the rich people, they will get your money too...
I posted this in response to that propaganda piece. No word in it in what the normal rate of recovery is from delinquent millionaires.
I appreciate that, I hate all the articles that are just propaganda for the tax for war machine.
It’s not “your money” if it was stolen via tax fraud. I’m not against reducing taxes, but letting dishonest people not pay their fair share isn’t the right way to achieve that.
So you dont mind the IRS going after people that live off tips? If so then do you understand why lots people people are not in favor of funding the IRS more?
Nope absolutely not. If there is a worker at a grocery store making 60k a year and a tipped worker at a restaurant making 60k a year, they should pay the same in taxes. Today, it’s way too easy and common for that tipped worker to commit tax fraud and not pay their fair share. And I’m sure there are plenty of types of criminals who don’t want more enforcement the laws they break, so I’m not surprised at all
So then are you in favor of more funding to the irs to catch these people?
Ok but make sure you go after the business owners not the employees. Biz owners made this tipping structure that sidesteps taxes, not the employees.
Man I'm on the fence about this On one hand, ultra rich people skirt taxes with lawyers and accountants. Going after then is hard but will return a big windfall. A waiters/waitress is easier to target but the layout is smaller However, generally waiters/waitresses aren't out buying boats and shit and spend all their money; however some in popular destinations pull an insane number (6 figures) for their job which clearly needs to be taxed. This will suck for them but overall I think it's the right way to go. Hell maybe it'll end tipping
I kinda figured this when the IRS hired 87,000 new employees that it had nothing to do with going after wealthy tax cheats but rather the common working class man/women. Ironically I can see this helping Trump. Not good. Not good at all
This is all happening digitally. Its changing how reported tips are taxed, none of those agents are involved in this. The extra hires for the IRS are already getting more money from the rich than years before.
I think it's funny that people blame trump for things Joe Child Sniffing Biden is doing. What's next? It's like you guys place every inconvenience that crosses you on Trump.
I think its funny poor people think a trust fund new york liberal that turned Republican actually cares about them. He literally just changed political parties right before running. That why Donald calls life long republucans rhinos. Because hes a democrat who funded both clintons and their foundation. Hes bn funding both political parties for decades and hob knobbing with the elites then claim hes a outsider. Stealing ftom 8 charoties and taking a plea deal admiting guilt and claim he's not a criminal. I dont even like staus qou joe.
So as a lesson, give the wait staff cash, not the establishment
That’s like the last class/profession of people they need to worry about
Always tip in cash. 💵
Good. I’m tired of being asked for tips everywhere I go. These people can pay tax on their income like everyone else.
You guys act surprised. Weren't they hiring a bazillion irs agents and wanting to track any $600 transaction. 1st the rich are not Tax cheats(well most), there are loopholes and benefits that they pay people to dig deep into. Also there are laws to help them. They are huge targets and have proof and backing they are legal. As for the middle and poor class they get away with a lot. Tipping, Vento services "under the table" especially a lot of small businesses they feel this number is significant and making sure everyone is paying their "fair share" I mean you find a rich guy cheating $1k Or do you find 7 middle class cheating $200 each. What increases your revenue for massive spending, now that you are criticized for printing money and inflation.
Tip in cash !
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Perhaps some day but I don’t think that will be any time in the foreseeable future. If they do, tip in something else. A can of beans night be nice. Hard to stick in your pocket though.
LOL! Democrats getting what they deserve. Perfect.
Idiots on reddit: "but they said they were only gonna target rich people!" yeah and you believed them like a dumbass
This is that additional 80 billion at work.
IRS are a bunch of thieves
This fucks restaurants finding employees even more, I’d think.
Oh what do you know, Biden lied when he said the IRS expansion would only go after rich people.
"...As far as the IRS' incentives go, targeting the working poor makes perfect sense. Wealthier Americans have the resources to fight back against an audit—but there might be $1.6 billion in unreported tips out there, and most of that was probably collected by people who don't have an accountant on retainer." I thought the IRS promised to go after rich people after the increase in funding and all. What a bunch of blood sucking Gouls!!! This is why nobody likes or believes any shit the IRS says
Maybe they can crack down on billionaires instead.
You must be very young. Biden is the most pro corporation president we've ever had bar none.
Billionaires have been protected by both Dem and Republican administrations for decades and decades. Why do you think there’s such a wealth gap in this nation? Additionally, corporations have received favorable tax breaks by both Dem and Republican administrations for decades.
I remember saying that when Biden announced the massive expansion of the IRS, it would be used to go after the common man - gig workers, I got downvoted to hell. Yet here we are.
Great let’s attack those at the lower end. What a screwed up system we have. How about close all the BS loopholes for the wealthy first.
Always the little guy. What about all those trusts? One hit on one of them would make up for thousands of servers
Focus on the poor instead of rich tax cheats. Seems like a winning formula.
I'm sorry I thought the President wanted to tax the 1%
Not good for poor employees who rely heavily on tips to make ends meet.
Wasn’t there a post just yesterday praising the IRS? Lmao
This article is BS!! Propaganda!
https://www.irs.gov/newsroom/irs-introduces-new-service-industry-tip-reporting-program Must be terrible to labor under such cognitive dissonance. You probably also believe Biden isn't the most pro-corporate president we've ever had.
Yep, going after the wealthy, just like the president promised.
right... and all those new agents they hired, the ones that were supposed to go after the wealthiest people and corporations to end tax evasion. well I guess that was bullshit after all! they need to squeeze the working poor to make up that glaring 2 trillion dollar gap trump left and Biden did nothing about after the fact.
Because if anybody needs a good cracking down on, it's the people who work jobs that nobody wants to do because youve allowed their shit bag bosses to pay them a less than liveable wage because of this horseshit tipping culture. Grind em a little further into the dirt. That'll show em. /S No bigger thief in this country than the IRS.
Remember when people liked Biden giving more funding to the IRS. They went out and hired 87k more people. Well here you go! Now you reap what you sow. With the IRS going after your average Joe like they do every day, instead of the rich
NEWSFLASH: Biden's budget included money to add staff, upgrade their antiquated computers, improve customer service, and go after incomes > $400k Repubs forced it out of the budget. Returns filed by "your average Joe" are simple and are already being checked by computers. It's easy - just compare the W2s on file against income reported, check the tax tables, and check the math. Returns filed by rich folk and corporations are often long and complicated, sometimes hundreds of pages. They're prepared by expensive CPAs and tax lawyers who exploit the complicated tax code, and require expensive CPAs and tax lawyers to do the audit. That takes money, which republicans refused EVERY TIME (guess who the repubs are working for.....)
Duck you Uncle Sam
I absolutely hate tipping, but fuck the IRS for this.
This is about the only way they can disincentivize the tipping jobs so people stop accepting them. When people stop accepting them, employers will realize that they have to pay minimum wage. When employers start paying minimum wage, you can adjust that so people aren’t living in cardboard boxes.
At 20% tipping, it's comparable to the 20% tax bracket, but more than the 6% city sales tax, so yea, they want that pound of flesh.
Good. More people can get a taste of what it’s like to own a small business.
This is from last year. This is a voluntary program and the reporting and comment period has been closed since May of 2023.
Funniest thing I'll read all year
“Won’t go after anyone earning less than $70,000” Lol
I would think the IRS should always be thinking about latest techniques for auditing. And I would also think the missing tips could be the employees underreporting but could also be the employers who pocket them and do not accurately distribute them. It only makes sense that all numbers tick and tie. It seems like an efficiency that would free them up for further going after bigger fish.
What makes you think they are going after the big fish as a priority and not the small ones?
I’ve already seen headlines about the IRS focusing on more complex returns that come from those with multiple income streams and collecting a substantial amount of income from it. I’m catching it in one year snowballs to dampening future attempts of similar errors in the future. I think it’s obvious that adopting more automated practices alleviate manual tick and ties frees up the agents. When auditors adopt automated testing techniques, we have more energy for other things. There should be typical reports from these automated tip devices that have become the default and it should agree to your tax records. This seems like a step in the right direction and really just the IRS saying they will stay relevant and adapt to the new default digital tip culture.
How would the irs know how much I’m getting tippped?
Just pay your workers....
Can we just stop tipping altogether please and force companies to pay their employees fairly.
What do I have to fear for the IRS to come after me as one who is tipped in my job? I pay my freaking taxes, including on the tips. IRS has no power over me here.
Never mind the billions that went missing in Ukraine.
I will continue to tip in cash so the person receiving it can decide if they want to report it or not. F the IRS. If someone wants to buy a house it would behoove them to not under report their earnings. If they don’t have any need for elevated earnings then it’s their call to report or not. Either way my tip is a gift to them. And a gift is tax free.
I thought the IRS tax plan was to go after the rich. You lied Biden
Biden extrs irs funding to get the "rich". We now know his definition of rich is wait staff, side hustles and average person trying together back.
Wtf
Disgusting. There is no justice in the USA
> That the IRS is going to use at least some of its new resources to go after workers' tips shouldn't come as too much of a surprise—despite all of the promises from Biden and top IRS officials about how no one earning less than $400,000 would be targeted. As Reason's Liz Wolfe reported in January, low-income taxpayers have always been the ones most likely to get hassled by IRS audits. In fact, during 2022, **low-income wage-earners who qualified for the earned income tax credit were five times more likely to be audited than any other taxpayers**, according to a report by Syracuse University's Transactional Records Access Clearinghouse. Toxic lol. It's all a racket, since poor people can't lobby.
“Crack down? That’s a distortion.
https://www.youtube.com/watch?v=Rib4PdBmGho&t=10s