Income Tax Fraud

Anger towards the Internal Revenue Service (IRS) is nothing new, however, it never ceases to amaze me how so many people forget one critical element regarding the IRS. That critical element - the IRS does nothing that isn't funded or directed by Congress.

I would never argue that the IRS hasn't done things that are questionable in terms of how they collect money and the rampant confusion in explaining the federal income tax code, which is tens of thousands of pages long and growing. BUT, keep one thing in mind - all that code that the IRS uses to do its job is passed and sanctioned by Congress.

So if you really want to change the IRS you have to get involved in changing Congress. Don't vote? Well, you and about 50% of the voting-eligible population in the US are in the same boat and quite frankly those of you who don't vote are the ones who contribute greatly to this problem. Politicians depend on a majority of the citizens of this fine country being turned off from voting. It's much easier for them to concentrate on their base constituency that they know supports their ideas than to have to persuade people that don't vote in the first place.

So, what does this have to do with the IRS? Plenty. As politicians make promises to those who helped them win their office, they have to be able to fund the causes and projects those same people want to see funded or the politicians won't have the same support when they run for office the next time. You don't have to look any further than the debate on the Alternative Minimum Tax (AMT) issue to see this in action.

Just about everyone agrees that the AMT is no longer serving the purpose for which is was first passed and that it is now being applied unfairly, but nobody has truly stepped up to resolve the negative effects of the AMT. The reason? With all the promised tax cuts the AMT brings in revenue that Congress knows it can't quickly replace. The only other promise of collecting large sums of tax revenue is the Tax Gap - a buzz word in Congress that has politicians salivating. See my article on this at http://www.helium.com/knowledge/151721-understanding-means.

Now some of these projects that politicians fight for are actually good for society. It's good for society to have our roads maintained, to educate our children and to feed the poor. Unfortunately, we're seeing the support to do these types of projects eroding. So, where is the money going? Well the IRS publishes statistics on its collection efforts and so do other government agencies. It's actually one of the things that Congress did right - making government agencies accountable to the American public. A good place to start in educating yourself on these types of reports is www.usa.gov.

However, if you don't want to take the federal governments word for anything then start with www.nationalpriorites.org. I actually believe that everyone should always look at multiple sources for their information to develop an informed thought process. At least, this is what I try to do. In fact, I believe in taking a balanced approach t to the subject of paying taxes.

Like many citizens I believe that Congress needs to be more responsible in collecting and spending our money. But, I also believe that taxes are necessary for a healthy and functional society, especially with regards to education and taking care of our children and our elderly. I too object to some of the things our money is spent on but that's why I vote. I believe that the best change in a society comes from knowledge and exercising the wonderful right to vote to express the results of that knowledge. But if you are determined to fight the IRS you'd better do your homework. As I've pointed out to people in the past, the IRS is the only agency that could send Al Capone to jail. Fast forward to today and we have the actor Wesley Snipes facing three years in prison for listening to the wrong tax advice.

So where should you turn to educate yourself on the best way to communicate with the IRS? First, there is the Office of the Taxpayer Advocate, established in 1988 along with the Taxpayer's Bill of Rights. It's predecessor, the Taxpayer Ombudsman was created in 1979. The Taxpayer Advocacy Service (TAS) has the purpose of advocating for the rights of the taxpayer. You can find more information on this at the IRS's website at www.irs.gov.

I believe we have a lot of work to do in getting this country back on the road to being truly for the people who actually pay to support it, but anarchy isn't the answer. Understanding our legal rights and influencing how our taxes are spent through voting and informed discussion will sustain us into the future far better than anything else. So will understanding the tax code at the federal, state and local levels so we can make more informed choices about those things we do that result in paying more income and other taxes. There are lots of legal ways to pay less taxes and we need to vote to make sure Congress keeps the balance between collecting the necessary taxes to keep our society strong and how much burden is placed on the lower income rungs of society. So, get out there and educate yourself and please vote!

Advantages of Outsourcing

Outsourcing is the current trend that companies implement to increase their production as well as to improve their services so that they would competent enough in business globalization. It lightens the workload of regular employees by sharing it with their outsourced companies and personnel. Thus, it increases the efficiency of the company to generate more profit out of its transactions.

Outsourcing happens when a company, for example, transfers its tasks into clients or workers outside the core company. Their relationship is maintained by a certain contract that the client signed the moment he submits himself with the terms of service or policies of the company he plans to work with.

Outsourcing of companies from highly developed countries like the United States usually reaches to the far to other countries. Take for example customer supports and call centers. Many US-based companies utilize clients in India and the Philippines to work for them. Many electronic products that are owned by US companies, are being assembled in China due to greater number of available workforce.

Let us look at the advantages of outsourcing in a broader picture

ADDRESSES UNEMPLOYMENT

One advantage of outsourcing is that both the outsourced client and the company are benefited. Let's take for example the call center jobs. In the Philippines, there is a big boom of opportunities for call center job openings. The Philippine government supported the invasion of these big US companies to the country with the aim of lowering the unemployment rate of the country.

True enough! A lot of college students and graduate engage in call center jobs because the pay is even higher than the minimum wage earners in the country. They wouldn't mind having to sacrifice their sleep of working at night, since they work based on US time, just to earn enough money that can be used for their education or for their families.

INCREASE ECONOMIC STABILITY

Because of having lower number of unemployed citizens, the economy of the country where outsourcing services are provided would boost up since they would gain positive confidence to attract more investors in the country. This would then increase tax remittances and government could utilize these taxes in its economic programs, thus, maximizing the benefits that could be gained from the outsourcing companies.

On the part of the workers, jobs offered by the outsourcing companies could be of great help to improve their present economic situation. As population increase, greater demands for basic needs is predictable, therefore, the minimum wage offered in third world countries like the Philippines, would not be enough to carry out day-to-day expenses. Since the outsourcing companies provide higher compensation compared to regular jobs, it would provide a better avenue for poverty alleviation in the nation.

COMPANY CAN CONCENTRATE ON INTERNAL AFFAIRS

Having a third party to do the other jobs in the company that requires manpower like for example in customer supports, the company can have enough time focusing on improving its internal competencies without having to worry much of the external affairs.

The outsourced clients are skillful enough to work based on the needs in the everyday transactions of the company, thus, giving an extra ground for the company to strengthen its strategic plans in further uplifting the profit gained through its products and services.

OUTSOURCING COMPANY SAVES MONEY

On the part of the company who outsourced, a lot could be saved for the salary of their workers. The minimum wage in the Philippines is of course lower than in the United States. Therefore it would cost less of these companies to hire external workers in the Philippines than in the United States.

In a smaller scale, let's take pharmaceutical companies as an example. In the case of clinical trials of pharmaceutical industries, it would be hard for them to get their patients who would be willing to join in the clinical experimentation of drugs under study so their option would be to build good relationship with hospitals to have ease of access of target patients. Nurses ad doctors would also be there as specialists who can help them in the facilitation of the study, thus, the manpower and the target subjects that they need are already at hand saving them time and money hiring professionals as well as unreliable subjects if they would do it outside hospitals.

INCREASED INTERNATIONAL RELATIONS

The outsourcing companies that invest in other developing countries help in increasing economic relations between its own country and the country outsourced.

The western companies usually outsource their jobs in the Philippines, India and China due to lower minimum wage in these countries compared to western countries. As the outsourcing companies reach out to these countries, economic relations between these countries are increased as they support economic treaties that would benefit each of them.

In conclusion, outsourcing is one of the ways how globalization works in the present day. It has improved economic situations of developing countries, it has improved quality of life of the workers and it has strengthened the bonds between nations as the outsourcing company also could concentrate more in its internal affairs while maintaining a less-cost-more-profit system.

References:

http://en.wikipedia.org/wiki/Outsourcing
http://www.sourcingmag.com/content/c051011a.asp
http://www.microsourcing.com/outsourcing-benefits.asp