IRS troubles show agency is long past its glory days
WASHINGTON — For a time, the Internal Revenue Service inspired awe and admiration in Americans, not just trepidation and lame jokes about death and taxes.
Everyone loved the revenue agents when they put away Al Capone, the Chicago underworld’s master of brutality and bribes, in a coup so spectacular it scared other gangsters straight.
In the year after, federal coffers swelled as delinquent taxpayers stepped forward to make good on their debts. Criminals came out of the woodwork to pay taxes on their ill-gotten gains. Authorities in what was then the Intelligence Unit of the Bureau of Internal Revenue nailed the slippery Public Enemy No. 1 when no one else could, scooped up New York City racketeers by the dozens and stood tall in the popular imagination as incorruptible, fearless stewards of the Treasury and the law.
Fine, but that was the 1930s. What have they done for us lately?
The essential mission hasn’t changed. The IRS still collects the money that goes back out to build roads, help look after people in their old age, fight menaces from Nazism to terrorism, and operate the vast levers of government. It still locks up a few thousand delinquents a year, among them drug kingpins who couldn’t be caught any other way.
But no one loves the IRS anymore. It’s our culture’s king-sized pain that makes you do hard math, issues nonsensical directions, takes your money and gives it to politicians to waste even as they borrow unspeakable sums from China to waste even more.
On top of that overdrawn caricature, the agency now is saddled with its episode of tea party tumult, exposing IRS behavior that is memorably bumbling at best and criminal at worst.
The IRS is something of a hybrid in its relationship with political masters, not the “independent agency” claimed by President Barack Obama when he dissociated himself from its discriminatory audits of conservative groups seeking tax-exempt status during the 2012 campaign.
It is partially independent. On one hand, the president and his people at the White House are barred by law from pressing the IRS to start or stop a tax audit. This is to prevent the president from putting the heat on a political foe or going easy on a political friend, both tactics of the past.
The commissioner serves a fiveyear term, ensuring that leadership is out of sync with four-year election cycles. The commissioner and chief lawyer are the only political appointees and must be confirmed by the Senate.
But the commissioner reports to the Treasury secretary through the department’s deputy and can be fired at will by the president, which is not the case in more hands-off federal bodies. Indeed, the acting chief, Steven Miller, was ousted within days of the report coming to light showing the misbegotten actions of lower-level employees; he was one of three senior officials to be sidelined in the continuing investigation.
The income tax was unloved from its inception.
Pushing for it in 1861 to help pay for the Civil War, Rep. Thaddeus Stevens declared: “It is unpleasant to send the tax gatherer to the door of the farmers, the mechanics and the capitalists ... but these things must come, or this government must soon be buried in its grave.”
President Abraham Lincoln signed into law a 3 percent tax on income greater than $800, a sum few people made. A progressive income tax followed a year later in a law establishing an enforcement arm, the office of commissioner of internal revenue in the Treasury Department. The wealthiest Americans paid 5 percent.
Before the end of the 1800s, the income tax was repealed, revived and struck down as unconstitutional, only to return in1913 with the enactment of a constitutional amendment.
The tax form of 100 years ago — three pages long, with another page of instructions — loosely resembles the short form of today, except for its provisions for deducting uninsured shipwrecks and its guidance to a still-agricultural nation about claiming income from the wool and hides of animals.