Confessions Of A Former IRS Agent

Former IRS agent Carroll McKibbinAll of the controversy over the Internal Revenue Service's investigation of Tea Party groups has unleashed a torrent of criticism of IRS tactics. But what do IRS agents think of their profession? And what do they actually do all day? Carroll McKibbin, a former IRS agent, gave AOL Jobs permission to reprint a column that he wrote for his local newspaper in which he shared his recollections.

By Carroll McKibbin

Everyone knows about paying taxes, especially this time of year. But few know about the collection end. I do. I'm a former Internal Revenue Service agent ready to share a few confessions.

I admit to having concern for my personal safety when sworn into office in 1960. The agent I replaced in Emporia, Kans., retired early -- deaf and partially paralyzed from being beaten with a tire iron wielded by an angry, drunken taxpayer. I also knew of the dangerous heroics of a retired colleague, Mike Malone, who infiltrated the Al Capone gang in the 1930s. Mike gathered enough evidence to send the infamous Capone to prison, not for the many murders he perpetrated, but for tax evasion.

Threatened With A Pitchfork
I never encountered any Mafia types, although our district office kept an eye on the business operations of Frank Costello, a notorious New York mobster who owned oil wells in Kansas. I did, however, face a couple of menacing weapons: a can of beer in one instance, a pitchfork in the other.

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The beer was hurled at me as I left the home of an unhappy man. I felt only the spray as the missile missed my head by inches. With his check in hand and suffering no harm, I proceeded to my car.
The pitchfork was grasped by a stout Kansas farmer as I called on him behind his barn. His manner wasn't threatening. His words were.

"What would they say if I stuck this in you?" he challenged.

Caught off guard, alone and defenseless, I replied, "I don't think that's a good idea."

The man smiled and wrote a check.

How Many HIgh Earners Pay The Top Tax Rate? Few
I confess to thinking the top bracket of the time, 91 percent, was exorbitant. I soon discovered, however, that no one I came across paid at that rate, or even half of it. The reason was simple. As income rises, so does the temptation of dodges.

Although the 91 percent category didn't seem to add much to Uncle Sam's coffers, it made collections easier. Many times, I heard individuals at lower rates say, "I don't mind paying my share when the Rockefellers are paying 91 percent." They obviously didn't know the real story, and I confess to never revealing it.

Mitt Romney's 14% Tax Bite Not Surprising
Tax brackets are always a hot political issue, but the truly important calculation is the "effective tax rate" -- the percentage of taxable income paid to the government. I wasn't surprised to learn during last fall's presidential campaign that Mitt Romney's effective rate for 2011 was only 14 percent. With an income of $13.7 million, Mr. Romney paid about the same percentage as a salaried couple with an income of $70,000.

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I often found cases of that kind, where taxpayers with high incomes had effective rates at a much lower level. I confess to giving those returns extra scrutiny, but I seldom found anything contrary to the Internal Revenue Code.

Two Types Of Taxpayers
The people I dealt with could be divided into two large categories: the naive and fearful on one side, and the informed and occasionally wily on the other. From the former, I sometimes heard a plaintive, "Am I going to jail?"

"No," I replied.

Among the guileful, however, I sometimes wanted to say, "Yes."

A CPA Who Didn't Pay Taxes
A case in point involved a CPA, no less, who filed his quarterly returns on time and in perfect form, but with no remittance. He ignored all inquiries from the IRS until I called on him every three months. He would greet me and ask, "How much do I owe this time?"

He understood the large penalty, 5 percent per month, was for late filing. A return sent on time without payment only accrued interest. He calculated that he could, in effect, borrow money cheaper from the government than from a bank.

Self-Employed: Most Challenging For Tax Collectors
Collecting from wage earners is easy compared to collecting from the self-employed. If an employee failed to respond to the several notices sent by the IRS, an agent could go to the employer, serve the appropriate document and receive the employee's wages.

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With the self-employed, however, I had to find a clear-title asset to expropriate, such as a bank account or automobile. As a result, 90 percent of delinquencies were owed by the self-employed.
Just how important are tax collections? During the several years of my service, the IRS calculated that we did not have a national debt, only unpaid taxes!

We are fortunate to live in the United States. We buy the essential public services and facilities of our civilization with taxes. I confess to paying my share willingly.

Carroll McKibbin is a retired professor of political science at California Polytechnic State University. He worked as an IRS agent for five years.

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21 Comments

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jimd2917

Hiya, how did ya know it was me

August 20 2013 at 2:04 PM Report abuse rate up rate down Reply
dgosbee

I have been in meetings with these creeps. They can, and do, lie and they get a commission for the collections they make. They teach them how to bully people. I had one clod sit in a meeting with my wife and he bullied her to the point of tears and then said he was going to conclude the meeting because he "felt uncomfortable". That was just before he lied about the payment schedule and threatened to close our business.

May 23 2013 at 12:59 PM Report abuse rate up rate down Reply
scott

the title said.. What if... i stuck this in you... lol i had to come read it.. bastards..

May 23 2013 at 9:30 AM Report abuse rate up rate down Reply
goatcars

You knew it wouldn't be very long before the first of many "confessions" come to light..... followed by the talk show circuit... book tour... and eventual movie!!!!

May 22 2013 at 4:20 PM Report abuse rate up rate down Reply
Rob

and he admitted to breaking the law, he gave rich people extra scrutiny. We have equal protection laws for a reason and this government operative felt it was his job (or right) to harass those in a class he did not like.. Flat tax and no IRS is the only way to go !!!!

May 22 2013 at 11:38 AM Report abuse +1 rate up rate down Reply
2 replies to Rob's comment
buddhaaaaa

He did NOT brake any laws when giving extra scrutiny to those large income earners.
He was doing his job.

May 22 2013 at 5:34 PM Report abuse rate up rate down Reply
rdrvr1752

From the description of his duties, he was a revenue officer (collector) not an agent. Revenue officers collect past due accounts and extra scrutiny to delinquents with ability to pay is part of the job. With a flat tax, there will still be a need to enforce collection as long as people have things they prefer to do with money than pay taxes.

May 22 2013 at 11:11 PM Report abuse rate up rate down Reply
Sol

was this an advertisement for big gov't? Abolish the fascist IRS and adopt the Fair-Tax!!!

May 21 2013 at 6:37 PM Report abuse rate up rate down Reply
qwerty0joe

>> Mr. Romney paid about the same percentage as a salaried couple with an income of $70,000

That's wrong and he knows it. A $70k couple with no deductions other than the standard deduction will pay about $6600 in taxes, or 9.4%.

May 21 2013 at 4:28 PM Report abuse +1 rate up rate down Reply
2 replies to qwerty0joe's comment
Juan Estrella

Rommney paid $1,918,000 in taxes at 14%. We wouldn't have a deficit if we had more smart successful people like him who paid almost $2 million a year in taxes. Most of us won't earn $2million in our life, much less pay that to the government each year.

May 21 2013 at 9:18 PM Report abuse +1 rate up rate down Reply
raddison4x

There is a difference in "payroll" tax and capital gains tax. That was money he had already paid taxes on and then he invested it and is paying capital gains on it now. He paid what he was required to pay. Notice how the article didn't bring up Obama paid under 20% for his taxes also???

May 22 2013 at 3:21 PM Report abuse rate up rate down Reply
1 reply to raddison4x's comment
buddhaaaaa

Wrong.
Romney paid taxes only on the "profit" off the earnings of investments, which he paid only 14% on.
The taxes you claim he already had paid had NOTHING to do with the profits he made on investments that were taxed as capitol gains. Those two are completely separate.

May 22 2013 at 5:30 PM Report abuse rate up rate down
Carl M

You will do Jail Time, @ some point they will understand there are more Tax payers than government defenders and if one shot was ever fired by a government official toward a Tax Payers they could Never stop the after effect's.

May 21 2013 at 4:26 PM Report abuse rate up rate down Reply
jmmydageek

"We buy the essential public services and facilities of our civilization with taxes."

What a bogus self-serving statement.

If we actually spent money on ESSENTIAL SERVICES, our taxes would be half what they are now.

May 21 2013 at 4:17 PM Report abuse +4 rate up rate down Reply
allen

It is about time that the IRS is shut down and replaced with a flat tax. This department is just used by the ruling party to intimidate its political rivals. It sees itself as above the law. Any time someone can just go and confiscate your assets with out having to explain it to a judge is to much power.

May 21 2013 at 4:14 PM Report abuse +3 rate up rate down Reply
1 reply to allen's comment
Sol

flat tax good, fair tax better. It ensures everyone pays into the system 'fairly' and also ensures the undergroud criminal economy pays their share.

May 21 2013 at 6:40 PM Report abuse rate up rate down Reply
1 reply to Sol's comment
Rob

there is no such thing as a fair tax.. everybody leads a different life and what is fair to one ins not so fair to someone else.. reach the constitution, it is not about fairness it is about freedom and opportunity..

May 22 2013 at 11:41 AM Report abuse +1 rate up rate down

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