Another good reason to be rich

Sure, there are plenty of good reasons to be rich– don't have to worry about the rising cost of living; the greater likelihood of attracting a pneumatic mate (or at least being able to afford to surgically alter your mate into a more pneumatic state, until a newer, pneumatic-er model comes along); etc., etc.– and now the Bush administration has given us one more. The rich are different from you and me, because the Bush administration doesn't particularly care whether they pay all the taxes they owe.

As David Cay Johnston reports in the New York Times:

The federal government is moving to eliminate the jobs of nearly half of the lawyers at the Internal Revenue Service who audit tax returns of some of the wealthiest Americans, specifically those who are subject to gift and estate taxes when they transfer parts of their fortunes to their children and others.

Of course there's an official reason for this change, which is being retailed to the public by such political appointees as Kevin Brown, an I.R.S. deputy commissioner:

The Bush administration has passed measures that reduce the number of Americans who are subject to the estate tax — which opponents refer to as the "death tax" — but has failed in its efforts to eliminate the tax entirely. Mr. Brown said in a telephone interview Friday that he had ordered the staff cuts because far fewer people were obliged to pay estate taxes under President Bush's legislation.

A perfectly reasonable sounding answer– a shame it's not the real reason.

But six I.R.S. estate tax lawyers whose jobs are likely to be eliminated said in interviews that the cuts were just the latest moves behind the scenes at the I.R.S. to shield people with political connections and complex tax-avoidance devices from thorough audits.

Sharyn Phillips, a veteran I.R.S. estate tax lawyer in Manhattan, called the cuts a "back-door way for the Bush administration to achieve what it cannot get from Congress, which is repeal of the estate tax."

Not that the rich really need the extra help not to pay taxes.

Over the last five years, officials at both the I.R.S. and the Treasury have told Congress that cheating among the highest-income Americans is a major and growing problem.

The six I.R.S. tax lawyers, some of whom were willing to be named, all said that clear evidence of fraud was pursued vigorously by the agency, but that when audits showed the use of complicated schemes to understate the value of assets, the I.R.S. had become increasingly reluctant to pursue cases.

The lawyers said that the risk analysis system the I.R.S. used to evaluate whether to pursue such cases gave higher-level officials cover to not pursue tax cheats and, in the process, emboldened the most aggressive tax advisers to prepare gift and estate tax returns that shortchanged the government.

"This is not a game the poor will win, but the rich will," said John Hruska, another I.R.S. estate tax lawyer in New York who, like Ms. Phillips, is active in the National Treasury Employees Union, which represents I.R.S. worker.

And so behind the gates of the more astronomically priced "communities" in Newport Beach and in other such pockets of purchasable Eden, there is much rejoicing. At least outside the servant's quarters.


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