What is CFO Jimmy Patronis thinking? | Opinion

The US Tax system relies on voluntary compliance. There are safeguards in place to ensure an adequate cash flow for government operations. Mandatory federal withholding and quarterly payment requirements are a few.

While 90% of taxpayers act responsibly there are others who are less than honest when it comes to self-reporting.  To discourage those, the IRS maintains systems to identify the possible under reporting and employs auditors to determine if there is an understated liability.

The article (: “State CFO wants new laws to counter IRS”) states the funding and staffing of the IRS has been cut by about 20% in the last decade. The effect of these cuts has weakened compliance efforts. Corporate executives, CPA’s and tax attorneys are well aware that the risk of being audited is significantly reduced. Some see this as an incentive to play fast and loose with tax law and significantly under report their tax obligation.

CFO Jimmy Patronis now feels that that alone is not sufficient incentive to cheat on your taxes. He now wants additional incentives to cheat by proposing that Florida pay the CPA and tax attorney fees to defend tax cheats under audit.

Seriously, not only will you probably not be audited but if you are the citizens of Florida will pay for your defense. The thinking behind this idea defies all logic.

I imagine the CFO’s proposal was the talk of the Chamber of Commerce meetings on Amelia Island last weekend. Business cards of the CPAs and tax attorneys are probably flying around encouraging all to support this proposed law and lining up clients to suggest grey areas to exploit.

Patronis is not alone in this irresponsibility. In fact, there is an epidemic of it in the GOP. Sen. Rick Scott and Marco Rubio are chiming in as are numerous GOP members in Congress. They say that the IRS is going after the average Joe’s money and that the Democrats claim that taxpayers earning less than $400,000 won’t be impacted is a lie.

Will some earning under $400,000 be the focus of the IRS? Yes, of course some will. If a consultant with $300,000 in income from several clients inadvertently fails to report a 1099 or two the IRS will certainly not ignore that understated income. If a small business with $350,000 in revenue claims charitable donations or certain business expenses that far exceed the norm for that type of business the IRS may ask that business to document that one-line item. They are not foolish people. Most IRS audit contacts are line-item audits where only one or two items are selected for documentation. They are not aggressive or burdensome.

The reality is the GOP attacks on the IRS are not to protect the average Joe’s money. These tactics are protecting the money that politicians hope will eventually trickle down to them from their wealthy corporate and individual campaign donors.

Charles Benz is a retired New York State Audit Section Head and a Sales and Use Tax Consultant. He and his wife of 50 years have lived in Tallahassee since 2005.

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This article originally appeared on Tallahassee Democrat: What is CFO Jimmy Patronis thinking? | Opinion