The woman who claims that she “never hated a man enough to give him diamonds back” may have to change her mind when it comes to Bernie Madoff. Zsa Zsa Gabor claims to have lost between $7-$10 million as part of Madoff’s scheme, leaving her with some substantial tax woes.
The 92 year old actress has been liened by the Internal Revenue Service for $118,000 for the years 2001 and 2002; the lien has been filed against one of Gabor’s mansions in California. Gabor’s lawyer, Chris Fields, says that the tax bill is part of the fallout from the Madoff scheme.
Gabor’s husband (from her longest marriage – so far) German playboy Frederic von Anhalt intends to help Gabor work out a payment plan with the IRS. Anhalt has reportedly received millions of dollars by selling the Anhalt name by adopting, along with Zsa Zsa, several men. If that sounds a little bit crazy, remember that this is the same man that claimed to be the father of Anna Nicole Smith’s baby (yeah, that’s where you’ve heard the name before). Crazy is relative.
The IRS announced that it has awarded nearly $8 million in matching grants to support its Volunteer Income Tax Assistance (VITA) program. The funds will be divided between 147 organizations in all 50 states and the District of Columbia.
Richard Byrd, Jr., the Commissioner for the IRS Wage and Investment Operating Division, said of the distributions, “We’re proud to support the VITA program and their volunteer tax preparers who provide an invaluable service to millions of taxpayers.”
VITA, which was created in 1969, is a volunteer program which aids low and moderate income taxpayers. Generally, this means individuals and families with adjusted gross incomes of $49,000 or lower. In 2009, more than 3 million tax returns were prepared at nearly 12,000 locations through VITA and the Tax Counseling for the Elderly programs.
You can see a list of organizations which received funds, including the amounts, here (downloads as a pdf).
Notably absent on the list?
Yep, ACORN. No surprise here.
What challenges are the IRS facing this year? Apparently not the complexity of the Tax Code.
The Treasury Inspector General for Tax Administration (TIGTA) released its perspective two weeks ago on the most serious management and performance challenges confronting the IRS. The top 10 challenges in order of priority are:
- Modernization;
- Security;
- Tax Compliance Initiatives;
- Implementing Tax Law Changes;
- Providing Quality Taxpayer Service Operations;
- Human Capital;
- Erroneous and Improper Payments and Credits;
- Globalization;
- Taxpayer Protection and Rights; and
- Leveraging Data to Improve Program Effectiveness and Reduce Costs.
In TIGTA’s twelve page memo (downloadable here as a pdf), the agency offers an assessment of the major IRS management challenge areas for fiscal year 2010.
“Complexity of the Tax Law” did not appear on this year’s list of challenges. TIGTA felt that the IRS had bigger fish to fry.
Not surprisingly, TIGTA found that many of the IRS Modernization Project milestones were “significantly over budget” and “significantly behind schedule.” That would explain why it ranks first on the list of challenges faced by IRS.
Also a top challenge? Taxpayer data security. Identity theft is a growing concern as more and more taxpayer data is stored in IRS computer systems and transmitted online. The IRS has demonstrated, through internal audits, that there are concerns with respect to both accessing private data and the stability of the data at IRS sites. Additionally, phishing and other targeted taxpayer scams are on the rise, which is an area of serious concern.
Another challenge worth noting: taxpayers with international activities. It’s no surprise to see this on the list considering the emphasis that the current administration is putting on offshore accounts. As US revenues shrink, US corporate revenues abroad are growing. In fact, TIGTA reports that US-based corporations more than tripled their foreign profits between 1994 and 2004, from $89 billion to $298 billion. Yet, considerably more than half of those profits were earned in low-tax or no-tax jurisdictions. Tracking that income is a serious concern to the acting Commish.
It’s always interesting to see what shows up on the list as top tax concerns. It often serves as a heads up to targeted enforcement practices and other shifts in policy. However, I have to say, this go around, I still can’t wrap my head around tax complexity not remaining a top issue. It’s a huge issue. Maybe the bigger problem is that we’ve become nearly apathetic to the cause. Perhaps it’s so complex that we don’t even think about it anymore? Kind of how we don’t even blink when we hear the word “billion” nowadays. The Code is not becoming less complex, maybe we’re just getting used to it.
And here’s their evidence:
Of course more folks are e-filing. It’s fast, it’s easy. And with more folks than ever with internet and computer access, it’s to be expected.
But.
And you knew there would be a but.
Here’s my cynical take… You’ll note fewer taxpayers filing generally, down a whopping 12 million this year. There’s a bump in 2008 – certainly attributable to the stimulus. Might it be the case – and I’m just saying – that folks have been encouraged to filing electronically in order to get money back a little quicker.
I’d love to see the data for 2009 returns filed in 2010. I’m betting if you back out the homebuyer’s, that percentage will drop a little. And I’m not a betting girl normally. But I have a hunch on this one.
