I have seen a claim that generally says something like this: black Americans make up 13% of the total population, pay 6% of all taxes, and received 26% of government benefits. I did a little bit of research and the artificial intelligence answers from several search engines confirm that these numbers are pretty accurate. I guess you could make the argument that we have already been paying reparations but that might make some of the woke left upset. One of the articles I read referenced a report from the Office of Tax Analysis that claimed the implications of these numbers is misleading because white Americans 'receive' $10 billion from the EITC each year. Numbers lie and liars use numbers.
The great thing about the Internet these days is that some of this information is readily available for review by the average person. So, I located the report and read it. In terms of percentages, white tax filers do receive a larger percentage of relief from the EITC and similar tax credits each year as compared to black and Hispanic filers. Deciphering the word salad in which the authors tried to explain this, they essentially say people in the black and Hispanic communities are ignorant of the tax credits or deductions they can receive. Additionally, they don't have access to professional tax preparers such as CPAs.
Later in the report, it becomes clear that the more accurate representation of 'ignorance' is among those in the lower economic strata, regardless of ethnicity or race. What they are saying is that more people in poorer communities use the pop-up tax preparers that show up in the local Walmart every year. Most of the people manning these tables have a couple of weeks of training in how to use a software system and probably don't have a lot of intimate knowledge about the actual tax code. But they offer free services and will give you an upfront loan for your tax refund charging a small interest rate or fee. That certainly appeals to people who are on a tight budget.
That brings me to the Direct File program created by Joe Biden as part of the Green New Deal or Inflation Reduction Act. This 'service' allows a tax payor to log on to a website, provide their information and the IRS will prepare your tax return for you, free of charge. Easy, peasy, lemon squeezy right? Not so fast Moriarty. The National Taxpayer's Union and the Inspector General both reviewed the software being used by the IRS to determine tax liability or refund . The NTU and Inspector General noticed that many deductions available to the filers we're not listed on the IRS software. Deductions for things like childcare, mortgage interest, or the EITC. This could cost people quite a bit of money. What would you expect from an agency whose sole purpose it to collect taxes? The more they collect, the better they look.
After claiming many taxpayers don't take advantage of deductions or credits because of ignorance or lack of access to tax professionals, the IRS decided to get in on the action. That's basically what happened. One side note, the Democrats that created this program also mandated that a survey be given to those that took advantage of the direct file program. To find out if they were satisfied or happy with the service. The Inspector General found that people could log in to the survey multiple times and also noticed that many of the computer addresses logging in to take the survey belonged to the federal government, the IRS specifically.
What a beautiful scam. Tell the people they're being fleeced by "Let us prepare your tax return because we know more about taxes than anybody else, and then we'll give ourselves a great review."
