Corruption and Mismanagement

On the other hand, the agency has been far less energetic when it comes to policing its own shop. Information showing abuses committed by high-ranking IRS officers has been repeatedly ignored. Those within the agency that blow the whistle on their superiors quickly find themselves demoted and penalized. It seems that some code of conduct, not unlike that found in military organizations, permeates throughout the agency. Undoubtedly the stories of corruption that do emerge are only the tip of the iceberg concerning all of the dirty dealings that happen behind closed doors. Still, judging from the size of this tip, the iceberg in question must be enormous.
Stories of corruption and wrongdoing range from the very top of the organization to the very bottom. An investigation conducted in 1990 by the Consumer and Monetary Affairs Subcommittee uncovered incidents of abuse that involved 25 senior officials and spread across ten different cities. Included in this list was the head of the Los Angeles Crime Intelligence Division (СШ), the agency responsible for examining possible infringements of tax laws. This government bureaucrat was allegedly operating a system through which fellow clients of his personal lawyer could obtain immunity from possible tax problems by anonymously clearing their debt to society by dropping their payment in a particular lockbox. At the other end of the scale, clerical staff in Florida were successfully indicted on charges of embezzling more than US $39,000 from the agency.
Bribes in any form seem to always be in fashion with those in the employ of the IRS . They range from the US $400,000 accepted by an IRS agent who, after accepting payment, was able to see the tax matters concerning one particular Californian farmer in a more favorable light to the cool million that helped another agent come to a similar conclusion for a much harassed taxpayer in Florida. However, IRS agents have gone to great lengths to insure that the nature of their corruption is far more creative and goes far beyond simply taking bribes to reduce tax assessments.
In 1992, it was uncovered that the branch chief of an IRS compliance center had filed a host of bogus tax returns using the identity of various individuals that he knew would not file. For his trouble, he received more than US $500,000 at government expense. Of course, all of this money plus penalties and interest would have eventually become the responsibility of those whose identities were stolen in this scam. Fortunately for them, the dirty dealings of this crooked bureaucrat came to light before the IRS pointed its finger at them. Other agents in both North Carolina and California allegedly took a more involved stance in the war on drugs, albeit not on the side usually favored by government officials. They have been accused of both laundering the proceeds of drug money and using their influence to help prevent a known drug dealer from being prosecuted.
Of course, above and beyond such incidents of outright corruption, the agency is also troubled by what amounts to the sheer stupidity of those in its employ. This shortcoming leads to the inevitable result of mismanagement. One favorite tactic is to arrange for the tax returns of honest taxpayers to mysteriously become “lost in the mail” in an effort to meet quotas and deadlines. Such practices are common across the US from Texas, where 27,000 tax returns were hidden by IRS employees, to California, where 39 bags of mail suffered a similar fate, to Philadelphia, where the more expedient method of simply tossing returns into the trash was used. Of course, such abuse by government employees still results in fines and interest payments for the taxpayers concerned.
As far as the agency is concerned it can do no wrong. It overlooks minor details, such as the fact that it openly admits to having lost over two million returns in 1989. It would rather not discuss the fact that in 1987 it spent a great deal of time and taxpayer money searching for a taxpayer who eventually turned up at his last known address, a federal penitentiary. Instead, the agency and the government behind it would rather get on with the business at hand, that of putting ever greater distances between you and your money.