“We’ll bill you for any interest and penalties.” Well, maybe not.
On Wednesday, we told you about changes in the tax code that will make filing your taxes even more complicated than before. But the Internal Revenue Service can’t even deal with the existing system.
The IRS sent notices to 90,000 taxpayers, warning them that they faced potential penalties for failing to file the proper tax forms for their nannies or other domestic employees. (Do you remember those forms? They’re the same ones that prevented certain women from becoming Attorney General of the United States.)
In fact, the innocent-but-frightened taxpayers had filed the proper forms, which is now Schedule H. IRS computer programmers had forgotten to program their computers to keep up with changes in filing requirements.
You may remember hearing about the IRS and its problems with computers before. The agency recently conceded that its $400 million investment in new computer systems was a complete failure and would have to be written off.
The 90,000 false warnings are “yet another example of why we need to overhaul the IRS,” according to Ohio Congressman Bob Portman.