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AI The Almighty Buck

State Tax Officials Are Using AI To Go After Wealthy Payers (cnbc.com) 106

State tax collectors, particularly in New York, have intensified their audit efforts on high earners, leveraging artificial intelligence to compensate for a reduced number of auditors. CNBC reports: In New York, the tax department reported 771,000 audits in 2022 (the latest year available), up 56% from the previous year, according to the state Department of Taxation and Finance. At the same time, the number of auditors in New York declined by 5% to under 200 due to tight budgets. So how is New York auditing more people with fewer auditors? Artificial Intelligence.

"States are getting very sophisticated using AI to determine the best audit candidates," said Mark Klein, partner and chairman emeritus at Hodgson Russ LLP. "And guess what? When you're looking for revenue, it's not going to be the person making $10,000 a year. It's going to be the person making $10 million." Klein said the state is sending out hundreds of thousands of AI-generated letters looking for revenue. "It's like a fishing expedition," he said.

Most of the letters and calls focused on two main areas: a change in tax residency and remote work. During Covid many of the wealthy moved from high-tax states like California, New York, New Jersey and Connecticut to low-tax states like Florida or Texas. High earners who moved, and took their tax dollars with them, are now being challenged by states who claim the moves weren't permanent or legitimate. Klein said state tax auditors and AI programs are examining cellphone records to see where the taxpayers spent most of their time and lived most of their lives. "New York is being very aggressive," he said.

State Tax Officials Are Using AI To Go After Wealthy Payers

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  • Oh no! (Score:3, Funny)

    by penguinoid ( 724646 ) on Tuesday April 16, 2024 @09:50PM (#64399924) Homepage Journal

    You can't go after people who claim to live in one of their extra homes for tax purposes but in reality are cheating the people of your state! That's so unfair, they might have to sell one of their vacation homes or even their yacht!

    • Oh no, if the wealthy have to play fair with taxes then we'll lose more low paying subsistence jobs!

  • 4th Amendment. (Score:4, Insightful)

    by gizmo2199 ( 458329 ) on Tuesday April 16, 2024 @09:54PM (#64399936) Homepage

    Almost positive a state tax agency using cell-phone records would run afoul of the 4th amendment, especially if they didn't get a search warrant which almost certainly they didn't

    • I'm just glad they decided to use this data gathering against rich people. The government might wipe their ass with the Constitution, but stopping the rich from cheating on their taxes is one step too far. I can only hope that when this is ruled un-American, it will be a wide ruling that covers you & me and not just "the IRS may not use this data".

      • I'm just glad they decided to use this data gathering against rich people. The government might wipe their ass with the Constitution, but stopping the rich from cheating on their taxes is one step too far. I can only hope that when this is ruled un-American, it will be a wide ruling that covers you & me and not just "the IRS may not use this data".

        No, for lower-income workers, the best we can hope for is "the IRS may not use this data for the next 6 years". Meanwhile, the rich will enjoy a permanent injunction.

      • Who do you think will be targeted with these tools after they've bled all "the rich" dry or they've all left? You think you're immune? You will be considered "the rich" then.

        • Targeted doesn't mean guilty. If people are cheating on their taxes, then they are *stealing* from all the other taxpayers. If you're worried about being audited then why? Are you cheating as well, and are scared that a crackdown will affect you? It's like being worried that there's a crackdown on the big drug dealers because you're afraid they'll find your dime bag in the bottom drawer?

        • I already pay my fair share in taxes. So sorry if the rich who have NOT been paying their taxes and YOU who hasn't been paying your taxes start to get investigated.
          You enjoy living here? then pay your share. If not enjoy another country.

          I hate the argument that if they go after the rich they will eventually come after us. When what you are saying is they are breaking the law, but we shouldn't prosecute. So sorry grifter

    • by Anonymous Coward

      Yes yes yes of course, you didn't consent to being part of society by using roads, electricity or language. No state can hold power over you since you're levitating and phasing out of existence any time they try to tell you otherwise.

      • Re:4th Amendment. (Score:5, Insightful)

        by Fly Swatter ( 30498 ) on Tuesday April 16, 2024 @11:02PM (#64400042) Homepage
        It used to be considered unlawful search, now it's just sold by a data broker.... The sad part is if this is explained to most people in detail they will be appalled at the loss of our privacy and rights to that privacy; then they will go on to say they can't do anything about it - so much for a government FOR the people. Now it's BUY the companies.
        • Re: 4th Amendment. (Score:4, Informative)

          by ToasterMonkey ( 467067 ) on Wednesday April 17, 2024 @01:20AM (#64400228) Homepage

          I'm having a hard time seeing how verifying someone's cellphone pings in your state frequently is an unreasonable search.

          • Smashing open your walls to check if anything is hidden inside the drywall is a reasonable search too, as long as they got a proper warrant for it first. Otherwise the search is unwarranted.

            • That's like comparing a death sentence after being found guilty in a trial - and randomly throwing a brick off a skyscraper.

              Also, there's no such thing as "a reasonable search".
              There's protection from "unreasonable search", as in "without a reason" - said reason being determined as valid (or not) through a process of issuing a warrant for search and seizure, by a court.

              In the case of phone records there's no need for warrants as said records are public.
              Have to be. That's how phones work.
              Both numbers have to

              • Yes, people are discovering that you can be under surveillance in public, or not under surveillance in public. For some reason, there's idiots who want a world of being universally under surveillance in public, with all their actions logged and recorded and archived forever.

              • >"In the case of phone records there's no need for warrants as said records are public."

                That's not true:

                Carpenter v. United States, 585 U.S. 296, 138 S.Ct. 2206 (2018), is a landmark United States Supreme Court case concerning the privacy of historical cell site location information (CSLI). The Court held that the government violates the Fourth Amendment to the United States Constitution when it accesses historical CSLI records containing the physical locations of cellphones without a search warrant.

                Prio

      • Re:4th Amendment. (Score:4, Informative)

        by ShanghaiBill ( 739463 ) on Wednesday April 17, 2024 @03:16AM (#64400370)

        part of society by using roads, electricity or language.

        Rich people don't use the roads more than other people, and a Mercedes doesn't cause more wear and tear than an F-150. Roads should be funded with fuel taxes and vehicle fees, not income taxes.

        Electricity is mostly sold by private companies. Where municipal power exists, it is not subsidized by tax dollars.

        Language? WTF? English isn't provided by the government.

        • Re:4th Amendment. (Score:4, Insightful)

          by DarkOx ( 621550 ) on Wednesday April 17, 2024 @09:13AM (#64400946) Journal

          Roads should be funded by taxes on tires. That would reflect wear on the public's property the road better than fuel.

          • This sounds like a great idea until you stop to think what would happen in reality. How many accidents are you willing to tolerate that are due to people driving on completely shot tires or ones hastily patched up because no one wants to buy a new set of $4,000 tires. Fuel taxes encourage people to buy more fuel efficient vehicles, which is good for the environment. Yearly license based on weight and other vehicle characteristics is a better bet, even though it doesn't perfectly reflect use. You could conce
            • by DarkOx ( 621550 )

              Best solution is an automated toll collecting system.

              That is a terrible solution in terms of privacy and the right to travel in general.

              You don't have to tolerate accidents, lots of states have annual inspection requirements and worn tires mean no vehicle registration for the year. Driving a vehicle without tags - arrest the person, tow the vehicle at their expense.

              • by Dadoo ( 899435 )

                lots of states have annual inspection requirements and worn tires mean no vehicle registration for the year.

                Good luck getting this passed in my state. I'm originally from Pennsylvania, where they do have inspections. When I mention that to coworkers, they complain about government overreach.

          • That would be an incentive for the government to NOT have paved roads - the worse your tires the more taxes you pay.
            Hell, it would incentivize the states to sprinkle nails along the roads in irregular intervals, particularly when it rains or snows.

            Fuel taxes, vehicle registration fees, license plate fees and levies on heavier vehicles distribute the road maintenance costs across all the users, with heavier users paying more.

          • by mjwx ( 966435 )

            Roads should be funded by taxes on tires. That would reflect wear on the public's property the road better than fuel.

            So a 2.5t SUV that guzzles petrol should pay the same amount of tax as a 1L city hatchback that sips fuel?

            Heavier cars do a lot more damage to the road than lighter cars, it far closer to an exponential difference than a linear one. Fuel is one of the easier ways of targeting people who drive overweight cars.

      • How much income taxes are being collected for the roads and electric grid. The answer is not very much and negative right now. So take that 2% of the total tax bill and return the other 98%. 50% of your taxes goes to social security, a Ponzi scheme that will be by all estimates bankrupt in 5-10 years, 25% goes to other nations in one or another way, the remainder is split between politicians self interest and some roads. The fact is the roads are dealt with by other taxes at the municipal level. Likewise fo

    • Re: (Score:1, Troll)

      by codebase7 ( 9682010 )
      Don't worry citizen! We've got Federal anti-state's-rights legislation coming to beat down this abhorrent and egregious state over-reach to the 1%'s wealth. Rest assured, those states (let's be honest: fucking blue states. The wrong side, as always...) won't be keeping a single penny of that unjustified tax increase!

      /s (I wish.)
    • Re:4th Amendment. (Score:5, Insightful)

      by uncqual ( 836337 ) on Wednesday April 17, 2024 @12:36AM (#64400166)

      The cell phone records are not subscriber's records or "papers and effects" - they are the records, and "papers and effects" of the cell phone provider.

      The cell phone provider is free to sell them (for example to a data broker) or give them upon a simple request to a state tax agency. Of course the tax agency could potentially get a search warrant if the cell phone provider didn't acquiesce to the agency's request voluntarily -- but that search warrant would be directed at the cell phone provider, not the subscriber. There's no reason that the subscriber would necessarily come to know of such a request or warrant.

      If a data broker has purchased or otherwise acquired a subscriber's cell phone records, the broker is free to sell them to a government agency.

      Even if a subscriber's contract with their cell phone provider forbids the sale or disclosure of the subscriber's cell phone records, the subscriber's recourse is a civil case against the cell phone provider.

      • You are wrong. The Supreme Court in Carpenter held that cell phone location data held by third parties falls under the 4th Amendment and therefore the government must get a warrant to request customer location data.
        • Re: 4th Amendment. (Score:5, Informative)

          by uncqual ( 836337 ) on Wednesday April 17, 2024 @04:27AM (#64400468)

          Carpenter was addressing detailed location information that could locate a subscriber's location very precisely by cell tower "triangulation" from a cell phone as it moved around without even making a call. It didn't extend to data the revealed the general location (such as which state) that calls were placed/received.

          Specifically Carpenter was careful to note that it was a narrow decision. The decision noted that it covered cell tower records that were collected just by the fact that phone was powered up but that required no other action (such as placing or receiving a call) on the part of the user. They didn't, for example, overturn Smith which found that there was no expectation of privacy in records of dialed phone numbers (back when a dialed phone number completely identified the location of 99.99% of the calls) even when collected by a "pen register" installed at the request of police.

          Perhaps lower courts have expanded their interpretation of Carpenter but I'm not aware of that having happened.

        • Re: (Score:2, Insightful)

          by pete6677 ( 681676 )

          New York government units wipe their ass with the constitution. They sure as shit aren't going to let some 4th amendment claims put a stop to their cash grab.

    • Obvious solution:
      1. Register a phone in your name and leave it with your friend in Florida.
      2. Use your burner phone when in NY.

      Alternative solution:
      Communicate with WhatsApp.
      The only person I talk to by "phone" is my mom.

    • Almost positive a state tax agency using cell-phone records would run afoul of the 4th amendment, especially if they didn't get a search warrant which almost certainly they didn't

      It sure is neat to live in a surveillance State eh? All of that data collected.... no proper controls... it is easy to just run an AI over the data with no oversight.

      That being said, I am GLAD they are doing this. They will be pissing off the people who most need to be pissed off as they are the only recognized citizens. Everyone else is just target practice. No respect.

    • I'm sure privacy experts are concerned.
    • by eth1 ( 94901 )

      Almost positive a state tax agency using cell-phone records would run afoul of the 4th amendment, especially if they didn't get a search warrant which almost certainly they didn't

      Not just that... anyone with that much money will probably have their houses, cars, phones, etc. all owned by LLCs and trusts, so that the tracking data is useless. Especially now that they've made it known they're using cell tracking.

    • It is different from state to state, but it tends to be public information.
      https://www.rcfp.org/open-gove... [rcfp.org]

      You're probably thinking of contents of those calls, which is another ball game entirely.
      That WOULD fall under "searches and seizures by the government" part.

      But phone records HAVE TO BE public information simply by the nature of how the phones work.
      You can't have a "super secret" phone number unknown to anyone, and have people call you on it - both the callers AND the phone system have to know your n

      • You can't have a "super secret" phone number unknown to anyone, and have people call you on it - both the callers AND the phone system have to know your number.

        But you can just use call forwarding from the number you give to people to the one(s) you don't.

  • by ksw_92 ( 5249207 ) on Tuesday April 16, 2024 @10:09PM (#64399960)

    I just got done reading Charles Hugh Smith's latest blog post (https://charleshughsmith.blogspot.com/2024/04/financial-forecast-2025-2032-please.html) about the need to "go grey" in the coming financial environment so this article about the PRNY using AI to look for "coins under the cushions" is timely,

    Smith's post (and he's pretty "lower-case libertarian") can be summed up as:
    "Be warned: as the economy and credit get tight, governments will pull out all the stops to get their 'fair share'. And it might be the right move if the alternative is a larger collapse."

    • And I'll leave you with this tweet from Mark Cuban. A self made billionaire. https://twitter.com/mcuban/sta... [twitter.com]

      • Lots of the very wealthy cheat. A lot. We even have a former commander-in-cheat. The richer you are, the easier it is to not pay taxes; tax havens, more loop holes, and definitely more opportunity to cheat compared to someone who only has a W2. So falsely declaring that you live out of state is an easy cheat, unavailable to most people; hiding money in shell corporations isn't easy for the average salary worker.

        I had a former boss who once suggested that if one is rich and pays any taxes at all then one

    • IRS agents go after wealthy tax cheats because they are scored and graded on how much money they recover and they're going to recover many many times more going after a wealthy tax sheet then they are going to go after some random Schwab who makes a little six figures or less.

      On the other hand they will go after those random slobs when they are required to by statute. There are several laws that require them to audit a certain percentage of low-income Americans. These laws were often put in place in exch
      • Rich tax cheats can afford good lawyers. The odds of getting them to pay what they owe aren't high, and your boss won't thank you for investing time and resources into trying to chase them down. On the other hand, if your can find a few people who died soon after taking early retirement, you can scoop most of their life's earnings, and the only choice their kids will have is whether to pay it all to lawyers or pay it all to the gubmint.

        Yes, I know two tax auditors, and yes, I know exactly how they work.P.

  • by Powercntrl ( 458442 ) on Tuesday April 16, 2024 @10:17PM (#64399970) Homepage

    Florida isn't a "low-tax" state - it is a no income tax state. The downside of course, is that you have to live in Florida.

    • You have to say you live in Florida. What are they going to do, actually check?

      • You have to say you live in Florida. What are they going to do, actually check?

        I can totally picture New York asking for Publix receipts as proof that you really spend most of your time in Florida.

        • by silentbozo ( 542534 ) on Tuesday April 16, 2024 @11:26PM (#64400068) Journal

          Actually audit you and require proof? Both California and New York will do this.

          https://www.latimes.com/busine... [latimes.com]

          "Answer: California, like other higher-tax states, has residency auditors whose specialty is asserting that affluent people who have left the state are still legal residents and thus are subject to its taxes. The audits can be stunningly thorough, looking at everything from the doctors you visit to where your artwork and other valuable possessions are stored.

          If audited, you would need to prove that you have a fixed, permanent residence elsewhere and that it’s truly your home. And yes, it’s up to the taxpayer to prove this — there’s no presumption of innocence in tax audits, says tax attorney Mark Klein, chairman of Hodgson Russ LLP in New York City. (New York is another state with notoriously hard-nosed residency auditors.)"

          https://www.sambrotman.com/per... [sambrotman.com]

          "If you have decided to relocate to another state to escape California’s high tax rate, then you need to do so with caution. Or, maybe you divide your time between California and another state(s).

          The state is very aggressive about collecting state income tax they believe you owe, and trust me, they will track you down.

          Many of our clients have had their residency challenged when it comes to filing their taxes. The Franchise Tax Board (FTB) will scrutinize your bank records, records of purchases and other transactions to make their case that you, indeed, are a resident of California. "

          https://www.hodgsonruss.com/wh... [hodgsonruss.com]

          "HOW LIKELY IS IT THAT I WILL BE AUDITED?

          Very likely. If you are a high-income taxpayer claiming a move into or out of New York, it’s a near certainty you will be audited. The Tax Department is sophisticated and aggressive. Consider some of the numbers:

                  The tax department has ten district offices located across the State (and in Chicago).
                  There are more than 300 auditors who focus on these
                  Over the past five years, the Tax Department has conducted over 15,000 of these
                  These audits have generated over $1 billion in revenue over this time

          In short, there are a billion reasons why the New York Tax Department watches these issues carefully. If you claim a move from New York, expect to get audited."

          • Emphasis on "if you are extremely wealthy" I don't know why people favor those people so much, especially when they're cheating on taxes. Average people don't have two homes, a normal taxpayer who moved out of New York who files the taxes citing 60 days in New York, 305 days in Vermont isn't getting fined. A normal taxpayer who forgets this is most likely not getting audited either unless there are egregious red flags (still getting paid by New York, New York address still listed on W2 forms, still paid

        • by HBI ( 10338492 )

          To establish residence in a state:

          1) Get a dwelling in your name - rental is fine, it's primarily a mail drop, but you can't use one of those mailbox places. Feel free to go cheap.
          2) Get a DL and a vehicle registered there, insure it
          3) Register to vote there
          4) Alter your primary bank information to point at the new residence
          5) Change your residence with your employer to there.
          6) File all taxes from that address.

          I survived two state audits this way while I owned a house elsewhere - from the state that the h

          • I think you might have discovered how we can save the poor, poor landlords with all those business towers they can't find a renter or buyer for.

            • by HBI ( 10338492 )

              Probably not, since one would *want* to establish residence in places with very little tax, and those landlords and business towers are located mostly in high tax destinations. Why would someone want to establish residence in NYC or SF, for instance, if they had a choice?

      • Depends, if you run for the Senate like Herschel did, they just might. Hilarious he was claiming a homestead in TX at the same time.
    • Florida isn't a "low-tax" state - it is a no income tax state. The downside of course, is that you have to live in Florida.

      Looking on the bright side... if you're moving to Florida, odds are you're not going to be living there TOO many years...

    • You don't have to live in Florida to move there if you're Jeff Bezos, sounds like thousands of others are following his noble tradition of moving to Florida without even being physically present.
    • I didn't think the wealthy lived off of income
      • by quonset ( 4839537 ) on Wednesday April 17, 2024 @06:34AM (#64400646)

        I didn't think the wealthy lived off of income

        Interest, dividends, sales of stock/bonds/property, rent collection, and royalties are considered income [irs.gov]. The IRS rule [cornell.edu] is, "income derived from any source". That rule now encompasses income from crypto which is why there is a checkbox [irs.gov] on the tax form asking if you've received or sold digital assets in the past year. If you don't check it and you did sell crypto and the IRS finds this out (because the firm you used reported it), congrats, you're in for an audit.

        • Right but taking out a "loan" is not income (which is handy if you never repay it [linkedin.com]); and "business expenses" are not income (which is handy is a business ends up paying for your food, your travel, your residence, and even your recreation [vox.com]); and capital gains are paid at less than the rate of regular earnings, which is handy if you take all your compensation as shares instead of a paycheck.
    • You also have to pay a bunch of other taxes. It's not quite as bad as Texas where Texans pay more than Californians in taxes but you're not getting off the hook. For one thing there are fuck ton of toll roads around Florida and that's essentially a tax. There's all sorts of other ways they nickel and dime you too.

      Again though because they can soak the tourists a bit it's not quite as bad but on the other hand the local and state governments have been chasing off a hell of a lot of tourists lately so prett
      • by Entrope ( 68843 )

        The analysis you are probably citing for "Texans pay more than Californians in taxes" is wrong -- laughably so, for example by imagining that California's typical home value is the same as the national median of $245,000: https://www.cato.org/blog/are-... [cato.org]

  • There will be selective blindness in the Artificial Idiots used. Wanna bet that rich people will be able to buy respective consulting soon or already can do so?

  • The wealthy typically have access to lawyers, accountants and friends in government most of us don't have.

  • The tax percentage depends on which state you live in, in the USA? This is surprising to me.

    What type of taxes are they talking about, that would vary from state to state, that would warrant this level of activity?

    • by Anonymous Coward

      Rich people enjoying the benefits of living in nicer states but are cheap fucks who don't like paying taxes. So they buy a shack in a shitty state and claim residence there.

    • In the USA, many taxes are set at the state and local levels, with income taxes and sales taxes (somewhat like VAT but not collected at all stages of the process) being the most common. This article is about a percentage tax on income. Some states do not tax income; some have a single tax rate for income; others have variable tax rates based on income. California's highest income tax bracket is 13.3%, for income over $1 million. So if someone claims to not be in California, and is a high earner, the sta
      • by Entrope ( 68843 )

        Property tax is an even more striking example, where the rates often vary even within a county. Where I live, property (real estate) taxes have a base rate of 1.135% per year with a bunch of add-ons for various tax districts, some limited to commercial property only. The next county over has a base tax rate for real estate of 0.865% instead.

  • Remember the dudgeon last year when some of the abortion Taliban states started data tracking residents who left the state to possibly get their desired medical procedures in 'free' New York or California? Now these same states have developed Strange New Respect for tracking it helps them collect their extortionate taxes.

  • Sell weapons. Set up a national vacation company and advertise to the world. Inset idea here.

  • They are NOT using AI to go after wealthy payers. They are using AI to figure out who to look which has a high probability to cheating the system. The fact that they are wealthy has NOTHING to do with it.

    I find it interesting that the woke are the ones that scream about words having meaning/power, but then turn right around and screw with things like this BS.
    I say go after these a55holes that are trying to hide paying their taxes.
    But even better would be to re-write our taxes so that they are fair an
  • Since when does the location where someone spends most of their time have anything to do with where their official residence is located for tax purposes? I can understand why people might make subjective conclusions based on that data, but what is the threshold as laid-out in actual law?
    • Since forever. Look up the 183 day substantial presence test. You always pay state income tax where the income is earned. The important piece for residency is capital gains because these aren't associated with working any particular state.
      • The important piece for residency is capital gains because these aren't associated with working any particular state.

        Or the reverse. I just moved to FL and sold my CA house (in that order). I expect to pay CA income tax (*) on part of the proceeds from my house sale, despite living elsewhere.

        * CA doesn't have special tax rates for capital gains -- it's all just regular income.

    • In California, it looks like this has been on the books since 1943 [ca.gov]...

  • A very simple tax system - flat tax, fair tax, take your pick - would mean you don't need to spend the money and time on complex software to detect possible tax evasion (or, more likely, simple mistakes in the mountain of forms).

    The tax code is the problem.

    • Even a complicated tax code would be fine if the government made the software/spreadsheet and was responsible for errors it made. You don't need to have a flat tax to make it easy on the taxpayer, its made a pain for them on purpose to make them resent paying them at all. You don't have to calculate variable sales tax yourself at the point of sale, the computer in the cash register takes care of it.
  • I am a tax professional, and we talk about the coming AI singularity in taxation. The end game is going to be a tax system run almost entirely by AI. AI will look at payment inflows/outflows and automatically set a total tax bill and arrange appropriate withholding. You'll be able to protest the AI generated number, but most taxpayers with simple returns will never have to file a return. Obviously, that requires buy-in by tax writers, but the revenue impacts would be large enough that it will become difficu

    • Looks a lot like what we are doing here in Denmark. Except AI is only for focusing controls. And unfortunately also valuation of real estate :-/
  • by GregMmm ( 5115215 ) on Wednesday April 17, 2024 @11:45AM (#64401458)

    For everyone who really thinks this is "only for the rich" you have your head in the sand, or somewhere else... You know, this is how the US Income tax started. It was sold as a way to "Soak the Rich". Do you think government will stop once they work out the kinks? Well not that I say that, it might be a while, but you get the picture. Start with everyone making over $10 million. Hey Sue, can you just change that number to making over $1 million, the government will get more money that way, etc.

    It comes for all of us. We are constantly being sold the idea this is only for the rich. Make them pay their fair share, etc. Then it slowly gets to middle class, then everyone. I'm just tired of politicians acting like white knights acting like they look out for me.

    For good or bad.

    • For everyone who really thinks this is "only for the rich" you have your head in the sand, or somewhere else

      You misspelled "wants to break the law by avoiding taxes".

      That's what this is about: finding people who are breaking tax laws.

  • by kenh ( 9056 ) on Wednesday April 17, 2024 @11:53AM (#64401494) Homepage Journal

    States are squeezing taxpayers more and more, driving taxpayers to avail themselves of LEGAL methods of lowering their tax bill.

    The IRS wants to ADD 87,000 new agents over the next few years, and promised not to *increase* the proportion of audits of middle- and lower-income tax filers. Sounds great, but the NUMBER of middle-and lower-income tax filers that will be audited will DOUBLE (but proportionally, the same). Why does IRS audit middle- and lower-income filers? Because they are the filers that either make mistakes or try to hide income - the rich can afford tax lawyers and accountants to help them lower their tax bill legally.

    NY has, for decades, challenged former NY residents that they still work in NYC and owe state taxes, forcing former residents above a certain income level to have to document their time out of state to establish they weren't in NY State more than a handful of days in a tax year.

    The low-hanging fruit in tax audits is home office deductions, business expenses, charitable deductions, and other areas where middle-income earners frequently 'fudge' the numbers to their advantage.

  • The number of people making over 1M is ~400,000 in NYS, the number making over 10M as the politicians like to claim they are focusing on is vanishingly small.

    They did close to 1M audits, even if they audited every single multi-millionaire as they claim, they still are auditing a ton of other people, mostly small businesses and middle class (restaurateurs often have over 1M in revenue, but keep less than 100k in personal profit)

  • You might not agree with the taxes you have to pay. But if you do the appropriate thing and pay your taxes to the best of your ability then you don't have much to worry about. They don't need AI to audit your basic return, that part has been automated for years. Do your part and don't worry.

  • The tax agencies do not pay enough to attract competent lawyers.

    As a result, they can intimidate working and lower-middle class people who can't afford a decent legal team but, they cannot intimidate rich people.

    NY may have a goal of going after wealthy tax cheats but, they won't succeed. The only winners in this will be the law firms who will rake in hefty fees while beating the government into submission.

    After a few years, the government will quietly return to the old status quo and leave the ric

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