IRS Workers Committing Tax Violations Faced With Light Penalties

On behalf of Brian Coggins of Coggins Law, P.C. posted in Tax Evasion on Thursday, May 7, 2015.

The Internal Revenue Service is a much-maligned and often vilified agency. Its reputation is often undeserved, as Americans tend to forget that tax laws are made by legislators. The job of the IRS is merely to collect revenue and ensure compliance with those laws.

That being said, the IRS has made some very public blunders in recent years. The latest is one that may be hard to recover from. According to an investigation and report from the Treasury Inspector General for Tax Administration, some 1,600 IRS employees have willfully violated tax laws over the past decade. And in 61 percent of cases, the offending employees were not fired and were instead given lesser penalties.

In cases where IRS workers are found to have willfully evaded taxes, the IRS commissioner has the authority to mitigate penalties instead of firing workers. And about 960 workers had their jobs spared and were given reprimands, counseling, suspensions or other consequences instead. In many of these cases, however, there was no documentation of reasons why the penalties were mitigated.

There are even allegations that certain employees who willfully violated tax laws went on to receive promotions, paid time off and cash bonuses. In true IRS fashion, a statement was issued guaranteeing the American public that the "agency will now ensure that employees who have willfully failed to pay their taxes are ineligible for performance awards," according to CNN. It also agreed to at least start documenting reasons why mitigations are granted to offending employees.

The heart of this issue seems to be basic fairness. If the IRS is willing to audit and heavily punish tax "scofflaws" outside its organization, it should seemingly hold equal or higher standards for its own employees.

Source: CNN Politics, "Tax scofflaws often kept IRS jobs, watchdog finds," Chris Frates, May 6, 2015