Why should anyone be afraid of tax resistance? The Picket Line gives us the lowdown on the statistics: the IRS can’t collect for shit, and they are incompetent fools.
Between 2002 and 2007, the IRS asessed $10 million in penalties against professional tax preparers for various forms of preparer misconduct. But the agency only managed to collect $2 million of this $10 million.
For tax year 2006, the IRS identified more than 1.2 million cases in which someone failed to file a tax return even though they had taxable income. In cases like these, the IRS creates a substitute tax return for the person, which (usually) results in a “default assessment.” But, “the IRS collected just under two percent of the taxes assessed through the automated process, a sign that this method is not increasing filing and
payment compliance.” The IRS responds: “We… do not agree with the suggestion that dollars collected is the best measure of the effectiveness of these assessments. Each assessment abated or adjusted reflects the submission of a return or other response by the taxpayer after the ASFR default assessment has been made — a clear indication the taxpayer has been successfully brought into compliance.”
The IRS reported 18% more “Taxpayer Delinquent Accounts” in 2007 than in 2006. 81% of these accounts involved tax years before 2004, and many are “inactive.”