First point. We don’t know what the tax returns of these two individuals that were audited looked like. Their returns could literally have “begged” to be included in the small pool of returns subjected to these intrusive “statistical sampling” audits. I can’t tell you how many times I’ve been told that “I’m getting audited because …… a) I’m a Republican, b) I’m a Democrat, c) I’m an advocate for xxxx cause, d) I’m part of a particular ethic or religious group……….etc. only to discover that the tax returns cried out to be audited or that the audit was otherwise prompted by reasons that are entirely logical from the standpoint of the IRS.

Second point, the agents who conduct this special type of audit are not always ball-busters. Yes, these audits are a giant pain. But in the handful of audits of this type with which I’ve been involved over the years, the outcome has generally not been painful. Just the process was painful. If you are going to try to use the IRS to mess with your political enemies (a la Nixon and LBJ), the best way to do that is to have the auditor focus on the weak spots on the return like a dog on a bone, not to have the auditor ask you to provide the birth certificates for all of your dependents, etc.

Finally, there is always more to the story that is not public. One example that does not involve individual taxpayers. Almost 40 years ago Jack Anderson ran a column on how the IRS was wasting money by sending its attorneys to training sessions at exclusive resorts. What provoked that column? A week long training session held at a place with which you are familiar, the Pointe at Squaw Peak (not sure if the name has changed). The training session was held in August. in Phoenix. Dirt cheap because no one wants to be in Phoenix in August. After that column came out, the next week long training session was held at some God-forsaken military base in the middle of nowhere where the cockroaches were bigger, and more plentiful, than the door nobs. (I was at both training sessions). Just for fun I looked into whether the session at the military base cost the government more money than the training session in Phoenix. You already know the answer: the actual cost of the military base training session to the IRS was more than the cost of the the Phoenix training session.

It is possible that this was not a coincidence. I would not wager a large sum of money that it was not coincidence, though.

I know Chuck as well, although I’m certain not as well as I Never Lie and am Always Rights. And I concur that he is a man of integrity. That’s why I was disturbed when I read this a few years ago:

[quote] When Trump nominated Rettig to lead the IRS in February 2018, Rettig initially failed to disclose that the Hawaii real estate he owned was at a Trump-branded property. He bought a 50 percent interest in two units at Trump International Waikiki in 2006 ahead of the building’s completion in 2009. It is likely that Trump profited off of his future-IRS commissioner’s purchase; although the Trump Organization does not own the Waikiki property, its branding deal gave it a 10 percent share of total pre-sales.

Records indicate Rettig is definitely making money from this purchase: on his financial disclosure, he reported an income between $100,000 and $1 million in rent and/or royalties from the units. The two one-bedroom condos are valued around $1.2 million each, according to Hawaii property records. President Trump also made a promotional appearance at the property in 2017 ahead of a diplomatic trip.

Rettig’s financial interest at Trump-branded property raises serious ethics questions as the president continues to fight to keep his tax returns secret. The public has a strong interest in seeing the president’s tax returns to understand whether he is using the White House to further his own bottom line. The fact that Trump’s IRS Commissioner is entangled in the president’s business interests means we have to ask whether Rettig’s decision on releasing the president’s tax returns is based on the public interest or his own financial interests. [\quote]

Because of Chuck’s reputation, that stayed with me. Given today’s news, an IG must open a case file on the audits to avoid the perception that the IRS was used for political means.

The IRS conducts several thousand research audits every year, looking into every cranny of a person’s or entity’s financial affairs in order to refine its ability to risk assess the remainder of the population for audit potential. While these audits are in theory random, this does not necessarily mean random across the population, as the NYT estimate of statistical likelihood assumes. In some instances, certain types of return are chosen for intense study for a year or two. About 15 years ago, I had a client living in Canada who had filed a Form 1040-NR for the commission-based service business performed for US companies. The IRS selected several hundred of these individuals for research audit so it could better understand Form 1040-NR filings. While I cannot completely discount the possibility that persons within the IRS manipulated the system to ensure that a research audit was performed on one or both, it is indeed possible that this is total coincidence. For example, the IRS might be doing research audits on filers who reported significant legal expenses (relative to income) on their respective Schedule Cs, or who have some other commonality that we don’t know about.

Add Michael Cohen, former fixer to the list, which reinforces the perception of political payback. It’s always about the projection for the GQP and Individual-1 in particular. If the names are public record, it might be worth cross-referencing to the ‘coffee boy’ list to see if a pattern develops.