IG: Billions lost to potential child tax credit fraud

Potential abuse of a popular tax-credit program is costing the government billions of dollars, the IRS inspector general said in findings that may ramp up the debate over undocumented workers getting government benefits. The IRS paid out at least $5.9 billion in improper payments of the additional child tax credit in fiscal year 2013…The IG previously reported that unauthorized workers were a major source of the improper payments…It also noted that its budget has been cut by $850 million since 2010, with 13,000 fewer staff…The $1,000-per-child tax credit is among the government’s biggest tax breaks for working families — but it is refundable, meaning that individuals can get cash if they don’t owe taxes, making it subject to abuse…What many call a nonsensical law creates the situation.The IRS requires workers to file tax returns regardless of their immigration status. Authorized immigrants use their Social Security numbers to do so. But those ineligible to receive them can instead get a nine-digit individual taxpayer identification number to use for tax reporting purposes. Experts say undocumented workers comprise the great majority of people using such numbers. About 3 million tax forms filed in 2010 had these ITINs. The IRS has said the law doesn’t give it the legal authority to deny the credit to unauthorized workers. (more)

(Related information from the “Treasury Inspector General For Tax Information” may be found here.)

(CBS 60 Minutes) Falling apart: America’s neglected infrastructure

Steve Kroft reports on why our roads, bridges, airports and rail are outdated and need to be fixed

“There are a lot of people in the United States right now who think the country is falling apart, and at least in one respect they’re correct. Our roads and bridges are crumbling, our airports are out of date and the vast majority of our seaports are in danger of becoming obsolete. All the result of decades of neglect. None of this is really in dispute…” (more)

Federal gas tax increase of 15 cents is coming…or is it?

Democratic Congressman Earl Blumenauer and Republican Congressman Tom Petri will stand together on the one year anniversary of Blumenauer’s introduction of the UPDATE Act (HR 3636), which would increase the gas tax by fifteen cents over 3 years and tie it to inflation. The current tax of 18.4 cents per gallon has not been increased since 1993. Receipts from the tax have been outpaced by transportation expenses by about $16 billion annually in recent years as construction costs have risen and cars have become more fuel efficient. The current level of federal transportation spending is about $50 billion per year, but the gas tax only brings in about $34 billion annually at its current rate. Transportation advocates have suggested that the current lame-duck session would be the best time for lawmakers to raise the gas tax because it would be more politically viable than it would be during the next Congress. But lawmakers have shown little appetite for tackling the proposed hike before the end of the year. (more)

The first U.S. state to enact a gas tax was Oregon in 1919. The state of Colorado, North Dakota, and New Mexico followed shortly thereafter. By 1929, all existing 48 states had enacted some sort of gas tax. Today, fuel taxes in the United States vary by state. The United States federal excise tax on gasoline is 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel. On average, as of January 2013, state and local taxes add 30.4 cents to gasoline and 30.0 cents to diesel for a total US average fuel tax of 48.8 cents per gallon for gas and 54.4 cents per gallon for diesel. The state and local tax figure includes fixed per gallon taxes as well as taxes that are a percentage of the sales price. For state-level fuel taxes, thirteen states levy taxes based on a percentage of the sales price, while Florida levies a tax with the rate tied to the Consumer Price Index. The other thirty six states and the District of Columbia do not tie their tax rates to inflation or gas prices, and only see their gas tax rates change when lawmakers vote to change them. As of December 2011, twenty six states had gone ten years or more without an increase in their gasoline tax rate. (more)

The United States Highway Trust Fund is a transportation fund which receives money from a federal fuel tax of 18.4 cents per gallon on gasoline and 24.4 cents per gallon on diesel fuel and related excise taxes. It currently has three accounts, the Highway Account which funds road construction, a smaller ‘Mass Transit Account’ which supports mass transit and also a ‘Leaking Underground Storage Tank Trust Fund’. It was established in 1956 to finance the United States Interstate Highway System and certain other roads. The Mass Transit Fund was created in 1982. (more)

American drivers, compared to those in other industrialized nations in Europe, pay relatively low federal, state, and local gasoline and diesel excise taxes. The Federal taxes are used specifically to fund annual highway construction, maintenance, and mass transit.  Over the years, proposals have come forth to raise the federal tax… If, as in the United States, federal gasoline tax revenues are directly tied to financing highway construction and maintenance, they can also create jobs and improve the national infrastructure…Although the federal gasoline tax is collected at the refinery, it is fully passed on to consumers, and is included in the pump price…Gasoline for use on highways is currently taxed by the federal government at 18.4 cents per gallon. Of this 18.4-cents-per-gallon tax, 18.3 cents per gallon is earmarked for the Highway Trust Fund, and 0.1 cents per gallon is allocated to the Leaking Underground Storage Tank (LUST) Trust Fund. The total excise tax on gasoline, at the retail level, is in the range of approximately 40 cents to over 50 cents per gallon, depending on the specific state and local taxes that are added to the federal tax. Federal, as well as most state and local levies, are unit taxes, and as such, do not vary with the price of gasoline… (Congressional Research Service, “The Role of Federal Gasoline Excise Taxes in Public Policy,” more)

An informed citizen…

…is the best when contacting your representatives and voting. A new page, “RESOURCES/LINKS” has been added above under “NATIONAL.” There you will find helpful information regarding your Senator & Representative as well as info about the Congressional Research Service (CRS) and the myriad of topics considered by our government that CRS has issued reports on. (CHANGE – Notice that “Comments” are no longer possible on the “Home” page. However, they can still be made on all other pages. This will help to aggregate comments on a given topic.)

Senate kills bill that would have reined in NSA and rampant surveillance

(https://nakedsecurity.sophos.com, 11/19/14) – Last night, Republicans led by Senator Mitch McConnell fended off efforts to rein in the National Security Agency (NSA), resulting in the axing of the bipartisan-crafted USA Freedom Act. The bill missed the chance to be debated by just two “yes” votes. With it goes what privacy advocates had called the best opportunity yet to curb the country’s run-amok surveillance… (more) (How did your Senator vote?)

Legislators’ redistricting – There’s a better way

“…There is plenty of evidence that maps drawn by partisan legislators have helped create the “suicide caucus” that is so intent on scoring political points instead of legislating…The way to stop gerrymandering is to shift from partisan state legislators to an independent citizens commission the job of drawing congressional and state legislative maps. Both political parties are guilty of gerrymandering districts to ensure their candidates’ re-election. Creating an independent, citizen-led commission would be a realistic solution to this issue…” (more)