Do you have your tax returns from 1972? You'd better, IRS begins retroactive theft
Sumner Redstone on the hook for $1.1 million, plus penalties and interest.
Don't forget to file your returns or else the IRS will come after you, even 41 years later. That's what's happening to Sumner Redstone, 89, who the IRS says owes 1.1 million, plus interest dating back to 1972.
The IRS claims the transfer was a taxable gift and Redstone says it was the result of a court settlement and therefore was "ordinary business."
Redstone, who is now 89, transferred the stock in 1972 following a lawsuit by his late brother Edward. Edward, who was upset with the family, threatened to sell some of his shares to outside investors. A court agreement allowed him to transfer those shares to his children as well as Sumner's children.
The greater issue is that the IRS is reaching back 41 years to claim money. The move is simply unprecedented. While statutes of limitations protect people from such cash grabs, the IRS claims there is no limitation because the proper returns were never filed. Without a return, there is no statute of limitations.
Still, even without a statute, for the IRS to go back 41 years is astounding.
Redstone, fortunately, is worth $4.9 billion, so he can probably afford the bill. However that's not the point. What matters is that the IRS thinks nothing of reaching back as far as needed to chase people who may have forgot to carry a 1 or who in their youth, didn't bother with their taxes.
What happens with the increased digitization of records? The time is coming when every person will be audited by computer and every mistake will be caught. Every penny must be paid. There will be no loopholes, no exceptions, and no time.
The IRS has also gone after the estate of Edward Redstone, sacking him with a similar bill. Edward died in 2011, however his estate remains. Attorneys representing the estate have also filed suit against the IRS.
There should be no reluctance to pay one's fair share to the IRS. Tax dollars sustain the government, maintain our infrastructure, and provide services that we all know are vital to a healthy economy. However, when tax dollars are squandered and the IRS has the ability to reach as far back as it wishes and lay claim to any amount of money it wants we enter a situation where the IRS becomes an agent of tyranny and harassment.
Retroactive theft. A new trick, for the IRS.
© 2014 - Distributed by THE NEWS CONSORTIUM
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