Our federal income tax system is becoming a parody of itself.

The Internal Revenue Service is curtailing audits of many people who use offshore tax havens, even when agents see signs of tax evasion, because agents fear they cannot meet a three-year deadline for finishing an examination, Congressional investigators have found.

In a report to be released on Thursday, the Government Accountability Office found that I.R.S. agents are so hobbled by “dilatory tactics” by offshore taxpayers and other problems that it takes almost two and a half years to complete a typical audit.

Many I.R.S. agents told the G.A.O., the investigative arm of Congress, that the “safest way” was often to stop an audit prematurely and sometimes to refrain from starting one in the first place.

The I.R.S. reported that almost $300 billion in investment and business income was moved out of the United States in 2003. Analysts at the Joint Committee on Taxation have estimated that the annual outflow has shot to more than $400 billion since then.

There is a better way.

• IRS audits more in the middle class
• Katrina/Rita victims stole over $1,000,000,000
• Bush planning on tax increase?
• Finding the worst in any situation
• Sen. Grassley’s “Tax Relief”

This entry was posted by Brian on Thursday, May 3rd, 2007 at 9:18 pm and is filed under Taxes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site. Please note the copyright policy.