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House votes to slash IRS tax enforcement budget

By WTOP Staff

ANDREW TAYLOR
Associated Press

WASHINGTON (AP) — The GOP-controlled House has voted to slash the budget for the Internal Revenue Service’s tax enforcement division by $1.2 billion, a 25 percent cut that would mean fewer audits of taxpayers and make it more likely that people who cheat on their taxes will get away with it.

The House approved the cuts by voice vote after little debate Monday night as it took up a $21 billion spending bill that sets the IRS budget.

The cuts reflect GOP outrage over the agency’s scrutiny of tea party groups seeking tax-exempt status and frustration over the agency’s failure to produce thousands of emails by Lois Lerner, the official formerly in charge of the IRS division that processes applications for tax-exempt status.

“The use of a government agency to harass, target, intimidate and threaten lawful, honest citizens was the worst form of authoritarianism,” said Rep. Paul Gosar, R-Ariz., author of an amendment to cut the IRS tax enforcement budget by $353 million. Rep. Bill Huizenga, R-Mich., followed up with an amendment to cut $788 million more. The underlying bill already contained a $72 million cut from last year’s $5 billion enforcement budget, bringing the total cut to $1.2 billion.

The Democratic floor leader on the funding bill, Rep. Jose Serrano of New York, opposed the amendments but opted against demanding a roll call vote.

“The answer is not to cut the IRS to bare bones, because our next problem is that the deficit will continue to grow because we won’t be able to do the proper collecting of tax dollars in this country,” Serrano said.

Budget cuts already are hurting the agency’s ability to police tax returns, IRS Commissioner John Koskinen has said.

Taxpayers’ chances of getting audited are lower than they have been in years. And this year, the IRS will have fewer agents auditing returns than at any time since at least the 1980s.

One’s chances of getting audited vary greatly, based on income. The more you make, the more likely you are to get a letter from the IRS.

Only 0.9 percent of people making less than $200,000 were audited last year, according to IRS statistics. That’s the lowest rate since the IRS began publishing the statistic in 2006.

By contrast, 10.9 percent of people making $1 million or more were audited. That’s the lowest rate since 2010.

The White House had already issued a veto threat on the legislation, saying it shortchanges the IRS, impedes implementation of the new health care law and undercuts the new regulations on Wall Street that passed in 2010.

House debate on the IRS and Treasury Department funding bill was to resume Tuesday. A companion Senate measure has stalled in the Appropriations Committee, hung up in part over a looming amendment by GOP leader Mitch McConnell of Kentucky aimed at blocking the Environmental Protection Agency from issuing new regulations limiting greenhouse gas emissions from existing power plants. McConnell appears likely to prevail in the committee, which is stocked with pro-energy Democrats who are up for re-election.

A fight over those EPA rules extended to the House Appropriations Committee, which approved by a mostly party-line vote a separate measure funding the Interior Department and the EPA on Tuesday. A Democratic bid to preserve the EPA rules failed by a 29-18 vote. Rep. Debbie Wasserman Schultz, D-Fla., labeled the measure “an ideological dumping ground of short-sighted environmental policies.”

Democrats protested language in the measure that would block the U.S. Fish and Wildlife Service from enforcing new rules that sharply limit sales of products made with ivory, even if it was legally imported before the 1990 ban for African elephants or the 1975 ban on ivory from Asian elephants. The rules are aimed at cracking down on the flourishing trade in illegal ivory but a wide array of people, including owners of musical instruments, antiques and guns made with ivory, are up in arms because they are in many instances no longer able to trade in such items, stripping them of their value.

Democrats prepared an amendment to protect the new rules, citing ivory’s role in financing terrorist organizations but withdrew it after Republicans promised to work to balance the needs of legal ivory users with the desire to fight illegal trade in it.

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Associated Press writer Stephen Ohlemacher contributed to this report.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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