All posts tagged "irs"

'Feels spoofed': Tax pros stunned as IRS site riddled with errors days before tax deadline

The IRS's website contains so many errors that one tax professional quipped, "This is feeling like the website is spoofed and your payments will go straight to Russia,” according to new reporting from Forbes.

"It would be funny if it weren’t true," wrote Kelly Phillips Erb, senior writer with the publication.

Erb wrote that the typos and errors were brought to her attention on Thursday, and she listed some of the more egregious mistakes in her article.

For one, taxpayers who file their extension request by the April 15 deadline get a full six months to file their return—but they must pay what they owe by the original deadline. That's not the message taxpayers have been getting recently. The IRS website suggests that taxpayers have more time to pay. The website message reads, "'Your payment is due on April 22, 2025, regradless of filing for an extension.' (Yes, the 'regradless' typo is on the IRS site, too)."

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One tax professional told her that the "installment agreement option" that allows taxpayers to make payments over five years was only showing a five-month timeframe. Another told her that the link to search for charities was wiped off the home page.

Erb wrote that "errors appear in other spots on the website, too, including misidentifying the amended tax form as Form 104X (it's Form 1040X) that was recently 'filled' instead of 'filed.'” In addition, forms from tax years 2022 and 2023 are showing up as "now being processed," even though that ship sailed a while ago.

Although it wasn't clear if the changes were made by Elon Musk's Department of Government Efficiency, Musk posted to X on Wednesday that the team had made at least one "fix" to the website.

Musk wrote, "The 'log in' button was not in the top right on the navbar like it is on most websites. It was weirdly placed in the middle of the page below the fold. An IRS engineer explained that the *soonest* this change could get deployed is July 21... 103 days from now. This engineer worked with the DOGE team to delete the red tape and accomplished the task in 71 minutes. See before/after pictures below. There are great people at the IRS, who are simply being strangled by bureaucracy.”

Erb wrote that she did not receive an answer to her request for more information.

Read the Forbes article here.

'Very clear on that': CNN host pushes back after GOP lawmaker checks her on migrant claim

CNN anchor Pamela Brown fended off a "gotcha" moment from Rep. Carlos Gimenez (R-FL) on the topic of undocumented immigrants paying taxes.

Brown began by discussing the potential of the Internal Revenue Service sharing "very sensitive taxpayer data" with the Department of Homeland Security "that could aid in deportations."

"You know, the only reason the IRS has this information is because these undocumented migrants voluntarily shared it," Brown said, "So, I just wonder, you know, why should people who are following the rules, paying their taxes, even if they are here illegally, be specifically singled out for deportation?"

"I think you caught yourself on that one, right? People that are following the rules," Gonzales scoffed. "These are undocumented migrants."

"Right, and I was very clear on that," Brown said.

"Okay, I got that. Okay," he mocked, before saying "It's a great point for debate."

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Gimenez continued, "But again, they are undocumented here and they're not supposed to be here. Yeah, they were trying to do something the right way, part of it. And, so, again, look, I think the courts will determine what's right or wrong on that. I tend to believe that if you're an American citizen — no, I know, I believe that if you're an American citizen and a resident and you're legally here, that your information to the IRS needs to be confidential."

Brown added, "It's estimated that undocumented migrants paid tens of billions in federal income tax in 2022. So, you do also have to raise the question, right, if this does happen, could that lead to millions of people hiding their income and potentially draining billions in revenue from the federal government, from the economy?"

Gimenez said he agreed with that premise, then went on to blame former President Joe Biden's immigration policies.

Watch the clip below via CNN or click here.

'South African chainsaw massacre': CNN's Tapper slams 'heartlessness' in DOGE's job cuts

CNN's Jake Tapper slammed Elon Musk's latest stunt surrounding the massive federal job cuts perpetuated by his Department of Government Efficiency and claimed some Republicans have started to feel "uncomfortable" with the administration's tactics.

Tapper said DOGE's goal of cutting 10% of the federal workforce was being handled, "with very little transparency, not much compassion, questionable planning, and very little apparent attention to detail, at least according to critics."

So far, entire agencies like the U.S. Agency for International Development have been shut down, while government leaders have been told to start firing "probationary" workers in a move that "could affect more than 200,000 federal employees," The Hill reported. The carnage isn't expected to end anytime soon, with employees at the Pentagon, the Center for Disease Control and Prevention, the National Institutes of Health, and even the Internal Revenue Service on the chopping block.

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"A couple of weeks ago, when this all started, we described the DOGE cuts as, quote, 'An ax being brandished and swung recklessly,' unquote. We apparently didn't go heavy duty enough, as Elon Musk yesterday on stage at CPAC wielded an actual chainsaw," Tapper said while playing a video of Musk waving around what he called, "the chainsaw for bureaucracy."

Tapper continued, "The 'South African chainsaw massacre' reveals something more serious: a lack of empathy for the thousands of Americans whose jobs are being slashed and lives are being upended. This same sense of callousness, minus the chainsaw, was also on display yesterday from another top Trump official, Kevin Hassett."

Video of Hassett showed him snickering while quipping about employees laid off for "poor performance."

"Kind of a heartless thing to say about thousands of your fellow Americans, many of whom are not being fired for poor performance," Tapper remarked.

He then spoke about Rep. Rich McCormick (R-GA) facing backlash from constituents who packed a town hall to demand answers, and Sen. John Curtis (R-UT) who told a local newspaper that DOGE was "not really factoring in the human element that these are real lives, real people."

"Beyond the recklessness, there's a heartlessness, a glee, and that glee has not gone unnoticed by one of the people whose Department of Education job is now gone. She's a disabled veteran," Tapper said before rolling tape of the heart-wrenching testimonial.

"That veteran's tears, all while the world's richest man waves a chainsaw in the air and giggles," Tapper said with disgust.

Watch the clip below via CNN.

'Total sham!' Defense Secretary Hegseth blames 'Biden IRS' over $33K audit

Defense Secretary Pete Hegseth expressed disgust on social media Monday after apparently receiving an IRS audit notice addressed to him and his wife.

Hegseth posted a photo of the notice that read, "Dear Peter B & Jennifer A. Hegseth: We're auditing your federal income tax return." The notice continued, "You owe a balance of $33,558.16" and advised them to "pay the balance due now to avoid additional penalties."

Hegseth wrote, "Of course the outgoing Biden IRS rushed an 'audit' of the incoming SecDef. Total sham. The party of 'norms' and 'decency' strikes again. We will never back down."

ALSO READ: 'Gotta be kidding': Jim Jordan scrambles as he's confronted over Musk 'double standard'

The former Fox News host was nominated to lead the Pentagon shortly after Donald Trump won the 2024 election.

His nomination was hotly contested by Democrats who complained Hegseth was woefully unqualified to lead the Pentagon. In addition, Hegseth faced allegations of sexual assault, alcohol abuse, and financial mismanagement. Vice President J.D. Vance was called upon to cast the tie-breaking vote that led to Hegseth's confirmation.

Military.com reporter Konstantin Toropin questioned the wisdom of Hegseth posting the notice on social media.

Toropin wrote, "The Secretary of Defense appears to have posted a document that shows he owes more than $33,000 in taxes following an audit. Aside from his calls to defy the IRS, this raises a myriad of questions from the quality of the vetting that was done to his vulnerability to bribes."

The Secretary of Defense appears to have posted a document that shows he owes more than $33,000 in taxes following an audit.

Aside from his calls to defy the IRS, this raises a myriad of questions from the quality of the vetting that was done to his vulnerability to bribes. https://t.co/j81tlZBhMQ
— Konstantin Toropin (@KToropin) February 17, 2025

Latest 'bad financial news for Trump' could cause ex-president 'tremendous damage'

If Donald Trump ends up on the losing end of a recently reported tax scandal, the former president could be on the hook for $100 million, which would reportedly be financially devastating for the Republican presidential candidate.

Trump biographer David Cay Johnston, who has covered Trump's taxes and financial matters for years, appeared on MSNBC on Saturday, where he was asked about recent news involving the former president's social media company that went public. Afterward, Johnston was also asked about a recent report that Trump was under audit after suspicions he defrauded the IRS of more than $100 million in a double-dipping scheme.

The host framed it as the latest "bad financial news for Trump."

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"Especially with his legal fees, can he afford that?" the host asked, referring to a loss of the audit battle. "What kind of damage could that do to him?"

"It would do tremendous damage to him," Johnston replied.

The writer then spilled some details about Trump's earlier IRS "cheating" scandal with similar themes.

"This is not the first time Donald has cheated this way by claiming deductions. He claims his Trump Tower hotel was worth nothing, essentially, and then put it into another company that he has and began depreciating the value of the company," he said. "Donald has fabricated more than five dozen businesses that don't exist and taken tax losses for them and he's been tried twice for income tax fraud, civil fraud, not criminal, and in both cases he lost."

Watch the video below or click here.

Private-public court debt collection scheme continues to profit

This article originally appeared in Oklahoma Watch, a nonprofit news organization that produces in-depth and investigative journalism as a public service.

When Aberdeen Enterprizes II threatened to have her arrested over $1,200 in outstanding court fines and fees, Kendy Killman became a prisoner in her own home.

The mother of eight feared being arrested unexpectedly, so she avoided unnecessary trips to the grocery store or her children’s school. She said the third-party debt collector rejected her proposition to set up a monthly payment plan, wanting only a lump sum or nothing at all.

“They would call once a week to threaten me, saying you’re going to jail and they’re going to come to your house and arrest you,” Killman said. “And I said OK, there’s nothing I can do about it. When you have no resources you have no resources. So I just kept waiting for them to show up.”

Cleveland County deputies arrested Killman on a failure-to-pay warrant in June 2016 during a routine traffic stop. Her debt was finally settled in November 2018, nearly a decade after she was convicted of misdemeanor possession of marijuana in 2009.

Killman is one of seven plaintiffs in a 6-year-old class-action lawsuit challenging Oklahoma’s court debt collection processes, which remains pending in the U.S. District Court for the Northern District of Oklahoma. The plaintiffs claim Aberdeen threatened indigent debtors with jail time and worked with sheriffs across the state to issue arrest warrants when payment did not come.

Federal law prohibits debt collection agencies from threatening arrest because of a lack of payment. However, Oklahoma law authorizes district courts to issue failure-to-pay warrants if a defendant has not paid their fines and fees or made contact with the courthouse.

The lawsuit, which is in the written argument stage, is credited with prompting legislation reforming how Oklahoma courts determine a criminal defendant’s ability to pay court fines and fees. Despite the federal litigation the Oklahoma Sheriff’s Association continues to profit from a partnership with Aberdeen Enterprizes to collect unpaid court debt.

Tax forms filed with the Internal Revenue Service show the Oklahoma Sheriff’s Association, a 501(c)(3) nonprofit that organizes training, offers administrative support and lobbies on behalf of 77 county sheriffs across the state, received more than $2 million from Aberdeen Enterprizes II between 2017 and 2021. The sheriff’s association received more than $415,000 from the arrangement in 2021, accounting for nearly 40% of the organization’s total revenue.

Since 2010, state law has authorized county sheriffs to refer unpaid debt cases to the sheriff’s association, which over the past 13 years has compiled the information and forwarded it to Aberdeen Enterprizes II. The collection agency tacks on a 30% collection fee, which is split with the sheriff’s association after payment is received.

Reached by phone, Aberdeen director Robert Shofner declined to comment. Ray McNair, executive director of the sheriff’s association, did not respond to several telephone messages seeking comment.

In federal court filings, Aberdeen and the sheriff’s association attest that their conduct did not violate federal or state law. John R. Woodard and Jennifer Struble, Tulsa-based attorneys representing Aberdeen Enterprizes II, wrote in a July filing that the company cannot be expected to be neutral because of how the debt collection industry works.

For the petitioners, who often struggle to pay for both necessities and the fees, the threat of arrest can be devastating. Killman, for instance, receives a monthly disability benefit to support her as she cares for her disabled son.

Some indigent defendants will see relief under a state law that took effect Nov. 1.

House Bill 2259 by Rep. Danny Sterling, R-Tecumseh, and Sen. Brent Howard, R-Altus, requires judges to notify defendants of their financial obligations at the time of plea or sentencing and allow them to present evidence that they are indigent. Those who are classified as totally disabled by a government entity, receive state or federal nutrition or housing assistance or whose income is below 150% of the federal poverty line will be presumed unable to pay court debt. Using 2023 federal poverty guidelines, an individual with an annual income of less than $21,870 or a family of four earning less than $45,000 per year would qualify for relief.

The legislation also requires outside collections agencies, such as Aberdeen Enterprizes II, to notify individuals of their right to request a cost hearing if they are unable to pay the debt.

Sterling said the legislation will ensure that criminal defendants statewide are treated fairly. Some district court judges are overly harsh while others are too lenient, he said.

“It was just not a very efficient system,” Sterling said. “It wasn’t working. This is maybe not perfect, but we feel like it’s a step in the right direction.”

Also taking effect this month is House Bill 2041, which authorizes law enforcement to give a verbal warning to individuals with outstanding misdemeanor warrants and advises them to contact the county clerk to resolve the issue. Rep. Monroe Nichols, D-Tulsa and Senate Pro Tem Greg Treat, R-Oklahoma City, sponsored the measure.

Criminal justice reform advocates have long criticized the state’s reliance on fines and fees to fund district courts and some state agencies. Since Fiscal Year 2007, between 66% and 90% of the state’s district court funding has come from fines and fees. Approximately 25% of court debt assessed is collected, The Frontier reported last year.

While Gov. Kevin Stitt and legislative leaders have indicated support for reducing some court fines and fees, several bills seeking to tackle the issue have fizzled out in recent legislative sessions.

A proposal filed this year aimed at reducing administrative fees placed on defendants cleared the House but did not receive a hearing in the Senate. In 2022, a bill that would have waived court costs after 48 to 60 months of on-time payments unanimously cleared the Senate but stalled in the House.

Killman, who secured stable employment and moved with her eight children from a two-bedroom apartment to a four-bedroom house after paying off her court debt, said she’s hopeful the state will continue to make strides in reforming its court fines and fees system. She said a good next step would be to outlaw third-party court debt collections.

“That should not even be legal,” Killman said. “All it does is cause more stress and cause people to owe more than what they began with. It just makes it harder on a person.”

IRS free tax filing rollout faces hurdles after multimillion-dollar lobbying campaign

This article originally appeared in OpenSecrets. Sign up for their weekly newsletter to receive stories like this one in your inbox.

New legislation could throw a wrench in IRS plans to launch a free government-run tax filing program after millions of dollars in lobbying by for-profit tax prep service providers.

On Monday, newly-minted House Speaker Mike Johnson (R-La.) introduced a bill making $14.3 million in aid to Israel contingent on reducing funding for the IRS. The Inflation Reduction Act of 2022, which President Joe Biden signed into law last year, set $15 million aside for the IRS to develop the free service. Leading for-profit tax prep companies oppose the program.

While Johnson framed the proposed cut as an attempt to offset the cost of the military aid package and reduce the national debt, a new report from the Congressional Budget Office found that defunding the IRS would actually increase the federal deficit by $12.6 billion over the next decade.

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The House is expected to vote on the legislation this week.

But Senate Democrats, who hold a narrow majority in the chamber, have called the bill a “non-starter.” The White House has also promised to veto the bill, favoring a joint package with military aid for both Israel and Ukraine.

Still, IRS cuts could resurface in future proposals to send military aid to Ukraine — a priority for Democrats who need buy-in from Republicans.

The proposal to use IRS funds to cover military aid to Israel is new, but it follows a multiyear fight pitting the IRS against for-profit tax prep companies as the industry makes billions of dollars helping Americans file taxes each year. Tax prep companies in turn pour millions back into lobbying to preserve the status quo.

The tax prep services industry has poured over $90 million into lobbying on the Free File Program and other issues since the program’s inception in 2003, a new OpenSecrets analysis found.

Intuit, the company that owns TurboTax, and H&R Block lead in lobbying spending but are bolstered by groups like the American Coalition for Taxpayer Rights, a tax prep, software and financial services trade association whose members include Intuit, H&R Block, Jackson Hewitt, TaxSlayer and Liberty Tax Services.

Intuit spent about $2.8 million on federal lobbying in the first three quarters of this year, outpacing the prior year and putting the tax prep company on track for a new record.

The TurboTax parent company — which also owns QuickBooks and Credit Karma — spent $910,000 on federal lobbying in the third quarter of this year alone, new lobbying filings show. The company spent nearly $3.3 million on federal lobbying in 2021 and another $3.5 million in 2022.

"Intuit strongly believes in advocating on behalf of its customers. As our business grows so does our engagement and education of policymakers on various issues, from AI and innovation that benefits individuals and small businesses to stronger consumer protections and tax simplification,” an Intuit spokesperson told OpenSecrets.

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The company lobbied for "intellectual property protections" as well as "AI and innovation to benefit consumers and small businesses," according to Intuit’s most recent lobbying disclosures, which cover activity during the third quarter of 2023. Intuit lobbyists also reported advocating for "consumer and small business prosperity related to data privacy.”

Over the two decades since the launch of the IRS Free File program, Intuit has poured over $46.2 million into federal lobbying, an OpenSecrets analysis found.

The Free File Alliance, a coalition of tax prep companies, reached a deal with the IRS in 2003 to offer free tax prep services to a larger portion of taxpayers.

The deal, negotiated by Intuit lobbyists, required companies to provide some tax filing services at no cost to certain individuals but also allowed those same companies to charge for other tax-filing products.

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In turn, the IRS promised not to develop its own tax prep software or e-filing services. But a December 2019 addendum to the public-private partnership’s original memorandum of understanding lifted that restriction, despite tax prep companies spending heavily on lobbying to bar the government from creating its own e-filing software.

The December 2019 addendum also prohibited companies in the alliance from thwarting Free File internet search results.

Multiple companies have since pulled out of the agreement with the IRS, including Intuit in 2021 and H&R Block in 2020.

The lobbying intensified following passage of the Inflation Reduction Act and a December 2021 executive order instructing Treasury Secretary Janet Yellen to consider “expanded electronic filing options,” spurring the development of Direct File, a pilot program to provide government-run tax filing services.

“Direct File is not free tax preparation, but rather a thinly veiled scheme where billions of dollars of taxpayer money will be unnecessarily used to pay for something already completely free of charge today – free to the taxpayer and actually free for the government,” an Intuit spokesperson told OpenSecrets. “The Direct File scheme is a solution in search of a problem, and that half-baked solution now has the potential to become a financial nightmare for tens of millions of taxpayers.”

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“Direct File is asking Americans to file their taxes directly with the IRS after the organization publicly acknowledged systemic inequities that see low-income filers and Black taxpayers targeted for audit at a higher rate than non-Black taxpayers,” the Intuit spokesperson added, referencing a recent Stanford University study that found Black taxpayers are audited at a higher rate than non-Black taxpayers. After pressure from lawmakers, the IRS acknowledged the study’s findings in May and committed to “doing the work to understand and address any disparate impact of the actions we take.”

Despite the tax prep companies’ heavy lobbying spending, the IRS plans to launch the pilot program next year.

The agency announced in October that the initial rollout will be limited to taxpayers in 13 states with relatively simple returns and specific income types but indicated that the program’s scope could change.

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According to the IRS, four of the 13 states — Arizona, California, Massachusetts and New York — will adopt the Direct File program for both state and federal taxes while residents in nine other states that don't have an income tax may also be able to participate in the pilot for federal taxes.

Taxpayers in other states — or whose filing needs are more complex, such as contractors — will not qualify for the services in 2024.

While the pilot program will only cover some taxpayers, a wider rollout could threaten the primary source of tax prep companies’ revenue. In August, Intuit announced that its annual revenue was over $14.3 billion for its 2023 fiscal year, which ended July 31, 2023 — a 13% increase from 2022.

H&R Block’s annual revenue was around $3.5 billion for its 2023 fiscal year, which ended June 30, representing a more modest increase of $9 million — or 0.3% from the prior year.

OpenSecrets is a nonpartisan, independent and nonprofit research and news organization tracking money in U.S. politics and its effect on elections and public policy.

IRS puts lien on Rudy Giuliani's Palm Beach home over unpaid taxes: report

Former President Donald Trump's close associate Rudy Giuliani has had a lien placed on his home by the Internal Revenue Service over $550,000 in unpaid taxes, reported The Daily Mail on Thursday.

"The IRS placed a lien on Giuliani's penthouse in Palm Beach, just three miles north of former President Trump's Mar-a-Lago residence," reported Jose Lambiet, noting that this allows the agency to seize some of the profits on any sale of the property.

"Records show Giuliani bought the three-bedroom, 2,000-sqft condo with then-wife Judith Nathan for $1.4million cash in February 2010," the report continued. "Nathan signed the condo over to Rudy after their 2019 divorce, according to records. Neither Giuliani nor his regular spokesman Ted Goodman immediately responded to a request for comment."

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All of this comes amid reports that Giuliani, a former federal prosecutor and mayor of New York City, is in financial dire straits, as legal fees and lawsuits pile up against him. Giuliani's problems are further compounded as the attorney representing him in the Georgia election racketeering case has dropped him as a client.

Giuliani allegedly played a key role in the plot to overturn the 2020 presidential election, advising the former president through it while taking ill-fated legal actions to try to block election certifications.

According to a report this week, federal prosecutors are examining Giuliani's alleged drinking habits, as well as whether Trump knew that his then-lawyer was intoxicated at the time he was giving certain advice, which could undermine Trump's ability to claim that he was acting on the advice of counsel.

Christian missionary imposter who used $30 million in donations for himself wanted by IRS

A Georgia man, who allegedly pretended to be a Christian missionary, could face up to 20 years in prison for allegedly misdirecting over $30 million from faith-based charities and donors to shell corporations, Christian Post reports.

"Named a fugitive by the" Internal Revenue Service (IRS) according to the report, the agency is currently searching for 45-year-old Jason Gerald Shenk, who promised donors "he would produce and distribute Christian literature and Bibles in areas throughout China."

Christian Post reports:

An unsealed federal indictment can potentially charge Shenk with four counts of wire fraud, three counts of international concealment money laundering, 13 counts of concealment money laundering, 21 counts of money laundering involving transactions greater than $10,000 and one count of failure to file a report of a foreign bank account.

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Per Christian Post, the IRS said, "Shenk allegedly used the donation money for his own personal financial gains," which "included paying about $1 million to a sports gambling site, buying equity shares of about $850,000 in a privately-held nuclear energy company and about $4 million in purchases of about 16 life insurance policies in different peoples' names."

Furthermore, Shenk spent millions on "diamonds, gold and precious medals," on "at least 10 personal credit cards," and real estate development in Satiago, Chile, according to the report.

The pretend missionary also misdirected funds to his own North Carolina-based business, Shenkland LLC.

Christian Post's full report is available at this link.

Jake Tapper presses GOP-backed whistleblower on why Trump-appointed prosecutor denies his claims

One of the Republican Party's whistleblowers in their Hunter Biden investigation, Joseph Ziegler — an IRS special agent and self-described Democrat — testified to Congress that he believed the Justice Department improperly prevented the full range of charges from being considered against President Joe Biden's son.

But when Ziegler appeared on CNN Thursday, anchor Jake Tapper asked him why Delaware U.S. Attorney David Weiss, a Trump-appointed prosecutor investigating the case, disputed all of these claims — and Ziegler had no answer.

"So, let me just, give you an opportunity to respond to some of the things that Democrats on Capitol Hill are saying," said Tapper. "First of all, they're saying, why would a Trump-appointed U.S. Attorney, David Weiss, lie?"

"I have no idea what his motives or beliefs are," said Ziegler. "All I can do is present the facts to Congress and it's for them to determine, and the American people and the administration to make the proper decision on how to move forward."

"Do you know of criminal charges against Hunter Biden that were not filed that definitively, there's evidence, proof that they should be filed and he should be facing justice for?" Tapper pressed him later in the interview.

"So, again, meeting with the assigned attorneys, and that included Department of Justice tax attorneys all agreed for felony and misdemeanor tax charges related to 2017, 2018, and 2019," said Ziegler. "I didn't see that in the charges document that was filed in Delaware."

"And those charges would have been for what?" asked Tapper. "Undeclared income?"

"It would have been a false declared tax income. 7201, tax evading," said Ziegler.

Contrary to Ziegler's claims, experts have said that most tax offenses of this sort, where the unpaid taxes have already been paid back, are actually settled in civil cases, with prosecution and plea agreements exceedingly rare.

Watch below or click here.