Saturday, January 30, 2021
Andrew Blair-Stanek (Maryland), How the IRS Should Fight the COVID-19 Economic Crisis, 166 Tax Notes Fed. 2067 (Mar. 30, 2020):
In this article, Blair-Stanek reviews the IRS’s responses — some good, some flawed — to the 2007-2009 financial crisis and draws a clear lesson to guide the agency’s responses to the economic crisis sparked by COVID-19.
Warren Buffett famously observed, “Only when the tide goes out do you discover who’s been swimming naked.” I could only speculate what economic fault lines the COVID-19 pandemic will reveal. But we will doubtless find that some harsh tax law requirements are worsening the economic crisis. Tax authorities like the IRS should not simply suspend enforcing those requirements; instead, they should temporarily move to a rule that requires taxpayers to compensate the government in proportion to their violation, thus preventing windfalls and abuse, and making broad, clear relief politically palatable.