Marlee Matlin
This evening, I learned from our Deaf American Actress, Marlee Matlin owes $50k back to Internal Revenue Service by the Reuters - Yahoo News website. All American Taxpayers are not perfect.
Marlee Matlin selling home after being hit with tax bill (Please click on blue bold and read it automatically).
The Internal Revenue Service (IRS)
The Internal Revenue Service (IRS) is the revenue service of the United States federal government. The agency is a bureau of the Department of the Treasury, and is under the immediate direction of the Commissioner of Internal Revenue. The IRS is responsible for collecting taxes and the interpretation and enforcement of the Internal Revenue Code.
The IRS has its National Capital offices in the greater Washington, D.C. area, and in particular does most of its computer programming in Maryland. It currently operates ten service centers around the country, to which returns sent by mail are sent. These centers do the actual tax processing; different types of tax processing take place in various centers (such as the distinction between individual and business tax processing). The IRS also operates three computer centers in various locations around the country.
History of the IRS
The IRS has had a colorful and checkered history of war, scandal, politics, and corruption.
American Civil War (1861–65)
In July 1862, during the Civil War, President Lincoln and Congress created the office of Commissioner of Internal Revenue and enacted an income tax to pay war expenses (see Revenue Act of 1862). The position of Commissioner exists today as the head of the Internal Revenue Service.
The Revenue Act of 1862 was passed as an emergency and temporary war-time tax. It copied a relatively new British system of income taxation, instead of trade and property taxation. The first income tax was passed in 1861:
- The initial rate was 3% on income over $800, which exempted most wage-earners.
- In 1862 the rate was 3% on income between $600 and $10,000, and 5% on income over $10,000.
- In 1864 the rate was 5% on income between $600 and $5,000; 7.5% on income $5,000–$10,000; and 10% on income $10,000 and above.
By the end of the war, 10% of Union households had paid some form of income tax, and the Union raised 21% of its war revenue through income taxes.
George S. Boutwell was the first Commissioner of Internal Revenue under President Abraham Lincoln.
Post Civil War, Reconstruction, and popular tax reform (1866–1900)
After the Civil War, Reconstruction, railroads, and transforming the North and South war machines towards peacetime required public funding. However, in 1872, seven years after the war, lawmakers allowed the temporary Civil War income tax to expire.
Income taxes evolved, but in 1894 the Supreme Court declared the Income Tax of 1894 unconstitutional in Pollock v. Farmers' Loan & Trust Co.. The federal government scrambled to raise money.
In 1906, with the election of President Theodore Roosevelt, and later his successor William Howard Taft, the United States saw a populous movement for tax reform. This movement culminated in February 1913 with the ratification of the Sixteenth Amendment to the United States Constitution:
“The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”
This granted Congress the specific power to create a direct income tax. By February 1913, 36 states had ratified the change to the Constitution. It was further ratified by six more states by March. Of the 48 states at the time, 42 ratified. Connecticut, Rhode Island, and Utah rejected the amendment; Pennsylvania, Virginia, and Florida did not take up the issue.
A copy of the very first IRS 1040 form, dated 1913, can be found at the IRS website showing that only those with incomes of $3,000 or more were instructed to file (the equivalent of about $65,000 in 2010 adjusted for inflation).
The IRS reinvents itself (1913–1970)
In the first year after ratification of the Sixteenth Amendment, no taxes were collected--instead, taxpayers simply completed the form and the IRS checked it for accuracy. The IRS's workload jumped by ten-fold, triggering a massive restructuring. Professional tax collectors began to replace a system of "patronage" appointments. The IRS doubled its staff, but was still processing 1917 returns in 1919. Currently, only the IRS Commissioner and Chief Counsel are political appointees selected by the President and confirmed by the United States Senate.
The agency continued to re-invent itself both organizationally, and technologically.
Presidential tax returns (1973)
From the 1950s through the 1970s, the IRS began using cutting-edge technology such as microfilm to keep and organize records. Easy access to this information proved controversial, when President Richard Nixon's tax returns were leaked to the public. His tax advisor, Edward L. Morgan, became the fourth law-enforcement official to be charged with a crime during Watergate.
John Requard Jr., accused of leaking the documents, collected delinquent taxes in the slums of Washington. In his words:
“
We went after people for nickels and dimes, many of them poor and in many cases illiterate people who didn't know how to deal with a government agency.
“He admits he saw the returns, but denies he leaked them. When asked if he would have leaked the documents, he said: "I probably would have said, 'Yes, I'm in'."
Reporter Jack White of The Providence Journal, won the Pulitzer Prize for reporting about Nixon's tax returns. Nixon, with a salary of $200,000, paid only $792.81 in federal income tax in 1970 and $878.03 in 1971, with deductions of $571,000 for donating "vice presidential papers". This was one of the reasons for his famous statement: "Well, I'm not a crook. I've earned everything I've got."
So controversial was this leak, that most later US Presidents released their tax returns (though sometimes only partially).
Modernization and the Internet (1970–present)
After microfilm, the 1960s onward saw massive computerization efforts.
In 1995, the IRS began to use the public Internet for electronic filing. Since the introduction of e-filing, self-paced online tax services have flourished, augmenting and sometimes replacing tax accountants to prepare returns.
In 2003, the IRS struck a deal with tax software vendors:
- The IRS would not develop online filing software.
- In return, software vendors would provide free e-filing to most Americans.
In 2009, 70% of filers qualified for free electronic filing of federal returns.
In 2010, more than 66% (98 million) of tax returns are expected to be filed electronically.
Bible and Religious
You know and hear about famous and typical words: “Separation of State and Church”. Remember, All Pastors, Church Administration Staff and Employees employ counting on Employment Taxes according to Internal Revenue Code. They required to pay their Federal Tax Incomes to IRS at all.
Most Missionaries are exempted from the IRS because they usually get support from their religious organizations out of the United States.
A Book of Romans 13:1-7
Submission to the Authorities
1. Everyone must submit himself to the governing authorities, for there is no authority except that which God has established. The authorities that exist have been established by God.
2. Consequently, he who rebels against the authority is rebelling against what God has instituted, and those who do so will bring judgment on themselves.
3. For rulers hold no terror for those who do right, but for those who do wrong. Do you want to be free from fear of the one in authority? Then do what is right and he will commend you.
4. For he is God's servant to do you good. But if you do wrong, be afraid, for he does not bear the sword for nothing. He is God's servant, an agent of wrath to bring punishment on the wrongdoer.
5. Therefore, it is necessary to submit to the authorities, not only because of possible punishment but also because of conscience.
6. This is also why you pay taxes, for the authorities are God's servants, who give their full time to governing.
7. Give everyone what you owe him: If you owe taxes, pay taxes; if revenue, then revenue; if respect, then respect; if honor, then honor.
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