MauledAgain

I am an advocate of user fees, to the extent user fees can best suited to the product or service being provided by a government. Not every government-provided product or service can be funded by a user fee. For example, the cost of national defense cannot be reasonably allocated among a nation’s people. Yet there are government-provided products and services that can easily be funded with user fees. For example, a local government that provides trash and recycling pickup and disposal can charge a fee based on weight, volume, or a combination of both.

Reader Morris passed along a story from Michigan reporting that Michigan’s governor has signed legislation that imposes a 24 percent wholesale tax on the sale of marijuana from growers and processors to retailers. The tax surely will be passed along to retail customers. What will be done with the proceeds of this tax? It will be used to fund part of the cost of improving Michigan’s roads.

Reader Morris asked, “Is the Michigan Marijuana tax to fund the roads a better tax policy than a vehicle mileage fee?” My answer is a resounding no. As I wrote to Reader Morris, “Some marijuana users use roads, others don’t. A lot of road users don’t use marijuana. What’s next? Taxing people who buy peanut butter to fund schools?”

Anyone who can show me a rational link between the sale of marijuana and the deterioration of roads is invited to educate me. Perhaps there are government expenses that can be rationally linked to the sale, or perhaps use, of marijuana. Perhaps something involving government funding of specified health care services. But why should people who may not be using roads bear the burden of financing those roads while far greater numbers of people who do use the roads aren’t subject to the marijuana wholesale tax? And anticipating reactions, for those who think I am defending, advocating, or involved in the sale, distribution, and use of marijuana, or am working on behalf of marijuana lobbies, I am not. I am simply pointing out the disconnect between the tax and the intended use of the revenues it produces, just as I would react the same way to a tax on candy, shoes, computers, clothing, or pet supplies to fund roads.

The answer, when it comes to financing the maintenance and repair of roads, bridges, and tunnels is the mileage-based road fee, which I has been the subject of my commentaries for almost 17 years, and which also is supported by a growing number of individuals and organizations. For those interested in the mileage-based road fee, including how it works and refutations of arguments offered against it, take a look at my commentaries, including Tax Meets Technology on the Road, Mileage-Based Road Fees, Again, Mileage-Based Road Fees, Yet Again, Change, Tax, Mileage-Based Road Fees, and Secrecy, Pennsylvania State Gasoline Tax Increase: The Last Hurrah?, Making Progress with Mileage-Based Road Fees, Mileage-Based Road Fees Gain More Traction, Looking More Closely at Mileage-Based Road Fees, The Mileage-Based Road Fee Lives On, Is the Mileage-Based Road Fee So Terrible?, Defending the Mileage-Based Road Fee, Liquid Fuels Tax Increases on the Table, Searching For What Already Has Been Found, Tax Style, Highways Are Not Free, Mileage-Based Road Fees: Privatization and Privacy, Is the Mileage-Based Road Fee a Threat to Privacy?, So Who Should Pay for Roads?, Between Theory and Reality is the (Tax) Test, Mileage-Based Road Fee Inching Ahead, Rebutting Arguments Against Mileage-Based Road Fees, On the Mileage-Based Road Fee Highway: Young at (Tax) Heart?, To Test The Mileage-Based Road Fee, There Needs to Be a Test, What Sort of Tax or Fee Will Hawaii Use to Fix Its Highways?, And Now It’s California Facing the Road Funding Tax Issues, If Users Don’t Pay, Who Should?, Taking Responsibility for Funding Highways, Should Tax Increases Reflect Populist Sentiment?, When It Comes to the Mileage-Based Road Fee, Try It, You’ll Like It, Mileage-Based Road Fees: A Positive Trend?, Understanding the Mileage-Based Road Fee, Tax Opposition: A Costly Road to Follow, Progress on the Mileage-Based Road Fee Front?, Mileage-Based Road Fee Enters Illinois Gubernatorial Campaign, Is a User-Fee-Based System Incompatible With Progressive Income Taxation?. Will Private Ownership of Public Necessities Work?, Revenue Problems With A User Fee Solution Crying for Attention, Plans for Mileage-Based Road Fees Continue to Grow, Getting Technical With the Mileage-Based Road Fee, Once Again, Rebutting Arguments Against Mileage-Based Road Fees, Getting to the Mileage-Based Road Fee in Tiny Steps, Proposal for a Tyre Tax to Replace Fuel Taxes Needs to be Deflated, A Much Bigger Forward-Moving Step for the Mileage-Based Road Fee, Another Example of a Problem That the Mileage-Based Road Fee Can Solve, Some Observations on Recent Articles Addressing the Mileage-Based Road Fee, Mileage-Based Road Fee Meets Interstate Travel, If Not a Gasoline Tax, and Not a Mileage-Based Road Fee, Then What?>, Try It, You Might Like It (The Mileage-Based Road Fee, That Is) , The Mileage-Based Road Fee Is Superior to This Proposed “Commercial Activity Surcharge”, The Mileage-Based Road Fee Is Also Superior to This Proposed “Package Tax” or “Package Fee”, Why Delay A Mileage-Based Road Fee Until Existing Fuel Tax Amounts Are Posted at Fuel Pumps?, Using General Funds to Finance Transportation Infrastructure Not a Viable Solution, In Praise of the Mileage-Base Road Fee, What Appears to Be Criticism of the Mileage-Based Road Fee Isn’t, Though It Is a Criticism of How Congress Functions, Ignorance and Propaganda, A New Twist to the Mileage-Based Road Fee, The Mileage-Based Road Fee: Simpler, Fairer, and More Efficient Than the Alternatives, Some Updates on the Mileage-Based Road Fee, How to Pay for Street Reconstruction, Stop the "Stop EV Freeloading Act" Because The Mileage-Based Road Fee Is a Much Better Way to Go, Why Is Road Repair and Maintenance Funding So Difficult for Public Officials to Figure Out?, Should (Will) Implementing the Mileage-Based Road Fee Cause Privatization of Highway Infrastructure?, The Freedom Caucus Doesn’t Understand that the Mileage-Based Road Fee is “PRO-Freedom,” Not the Opposite, A Mileage-Based Road Fee by Any Other Name?, Does the Mileage-Based Road Fee Work for Local Road Maintenance?, Washington State Mileage-Based Road Fee Proposal Changes: Is It Better?, The Mileage-Based Road Fee Is Much Better Than a Federal Fuel Tax Increase, and Ride-Share Drivers and the Mileage-Based Road Fee.

Earlier today, while scrolling through my newsfeed, I saw a meme that had a photo of an elderly person, captioned “Give our seniors a tax-free life after 65!!!” The silliness of this “petition” was, to me, so readily apparent. I was tempted to reply to the post but decided to share my reaction more widely.

Why do all people 65 or older need a tax-free life? Should millionaires and billionaire who are 65 or older live tax-free? Of course not.

The meme probably was written by someone 65 or older who was struggling financially while dealing with a tax increase, or someone reacting to a friend or family member in that situation. The meme addresses the wrong concern. It’s not that the person is 65 or older. It’s that the person is struggling financially. But people 65 or older aren’t the only people struggling financially. The concern isn’t age. It’s economic status. Should a person age 58 trying to live on an income of $7,000 be treated differently than a person age 67 trying to live on an income of $7,000? No.

Putting aside the erroneous substitution of age for economic condition, the underlying question is whether anyone should live a “tax-free life.” Someone who owns nothing and has no income might, by reason of their condition, end up paying no taxes, though that is unlikely considering that a person in that situation who manages to get some cash to make a purchase will, in most instances, pay a sales tax on that purchase. But for the vast majority of individuals, a “tax-free life” is a fantasy dream. Even the oligarchs and corporations who find ways to reduce their tax burdens rarely end up paying zero taxes. They get attention for having zero federal income tax liability but are paying fuel taxes on vehicles they own, property taxes on properties they own, sales taxes on most items that they purchase, employment taxes if they have employees, and so on.

The question isn’t whether anyone is entitled to a “tax-free life” but how tax burdens should be distributed. That question involves decisions with respect to the type of tax, the rates of tax, and the scope of the tax. These are complex issues. There’s a reason Tax Policy courses aren’t simple 30-minute meetings but require, at a minimum, multiple hours each week in a semester-long or year-long course.

But one thing can be learned without sitting through a Tax Policy course. There is no rational reason that every person reaching the age of 65 should be forever thereafter free from paying taxes.

Sometimes when a problem appears to have been solved, it turns out that the problem hasn’t been solved because a way is found to circumvent the solution. Why would this happen? It happens when the solution gets in the way of those who benefit from the problem. In other words, sometimes what is a problem for some is a windfall for others and thus the solution to the problem becomes an obstacle to obtaining the windfall. In turn, attempts are made to bypass the solution in order to continue obtaining the windfall.

One situation in which this problem-solution conundrum often pops up is when a property owner fails to pay real property taxes, the taxing jurisdiction causes the property to be sold, and the property owner loses whatever equity the property owner had in the property.

Five years ago, in Who Gets Surplus Proceeds From a Tax Sale?, I explained that the Michigan Supreme Court issued a decision in a case involving the sale of a property on which the real property taxes had been unpaid. A Michigan statute permitted the taxing jurisdiction to retain any excess of the selling price of the property over the amount of unpaid taxes, interest, fees, and costs. The Michigan Supreme Court held that permitting the taxing jurisdiction to retain more than the unpaid taxes, interest, fees, and costs violated the Michigan Constitution. Michigan was one of about twelve states with that sort of statute and I noted that it remained to be seen whether other states would eliminate this practice.

Three years later, in Supreme Court Puts An End to a Bad Tax Practice, I explained that a dispute involving a similar practice in Minnesota has reached the United States Supreme Court, which held that this practice violated the Takings Clause of the United States Constitution. The Court explained that a government cannot take more from a taxpayer than what is owed. Presumably, if a taxing jurisdiction in any other state with a statute similar to those in Michigan or Minnesota retains or tries to retain the excess proceeds, it will face a challenge and it will lose that challenge. Presumably the problem was solved.

But then a year later, in It Turns Out the Supreme Court Didn’t Put An End to a Bad Tax Practice, I had to backtrack on my previous headline, “Supreme Court Puts An End to a Bad Tax Practice,” with a commentary whose headline, “It Turns Out the Supreme Court Didn’t Put An End to a Bad Tax Practice,” because states had found a way to get around the Supreme Court’s holding. In this commentary, I explained that officials in Oakland County, Michigan, seized the home of a delinquent property owner, gave that home to a private company, which sold the house, remitted the unpaid taxes to the county, and kept the excess. The property owner received nothing. When the property owner sued, the judge dismissed the case because “the government itself didn’t make a profit.” What made this situation outrageous was the explanation from the property owner’s lawyer that the private company in question was operated by the mayor and the city administrator. Apparently the company collected $10 million in selling houses in this manner. In July of this year, the Michigan Supreme Court held that what had happened violated the Michigan Constitution, in Jackson v. Southfield Neighborhood Revitalization Initiative.

Today Reader Morris alerted me to a Pennsylvania Commonwealth Court decision, , Gaynor v. Delaware County Tax Claim Bureau and CJD Group, LLC, filed earlier this year. A property owner neglected to pay real estate taxes in 2020 because the pandemic paused visits to the courthouse and paused enforcement of overdue real estate taxes. When she later tried to pay those taxes her payment, unbeknownst to her, was applied to her 2021 tax bill. Later, when notices with respect to the 2020 taxes were sent she apparently did not respond because, according to this story, her mental faculties were declining. The county then sold the property to a private company for the amount of the unpaid taxes, interest, fees, and costs. The home, worth about $247,000, was sold to the private company for $14,000, and the company acquired the $233,000 equity. The homeowner received nothing. The homeowner sued, alleging that the notice of the tax sale was insufficient or defective, that she was not offered an installment payment plan, and that the property was worth more than 15 times what was paid by the private company at the tax sale. The Common Pleas Court rejected the homeowner’s petition, and the homeowner appealed to the Commonwealth Court. On appeal, the homeowner argued “that the trial court erred by failing to find that the price for which the Property was sold was grossly inadequate in comparison to the actual sale price.” The Commonwealth Court explained that the homeowner “did not allege any sale irregularities in her Petition, nor did she present any evidence thereof at the trial court hearing,” and held that, “ Thus, assuming, arguendo, that the Property was sold for a grossly inadequate price, because there is no evidence to even suggest that there were irregularities in the tax sale that contributed to the grossly inadequate sales price, the trial court properly denied the Petition.”

The Commonwealth Court noted, in a footnote, that the Statement of Questions Involved portion of her brief, the homeowner had presented two additional issues for the court to review, specifically “(1) whether the trial court erred by failing to exercise its equitable powers to set the tax sale aside where [homeowner’s] son testified that he would be able to pay all tax arrearages; and (2) whether the trial court erred by failing to set the tax sale aside where the County Tax Claim Bureau (Bureau) had failed to give proper notice or service of the sale in accordance with the requirements of Section 602 of the Real Estate Tax Sale Law.” The Court pointed out that the only issue addressed in the Summary of Argument and Argument portions of her brief was the question of “whether the trial court erred by failing to find that the price for which the Property was sold was grossly inadequate in comparison to the actual sale price.” The court treated the failure to address in the Argument portion of the brief the two issues described in the Statement of Questions Involved portion as having been waived.

There are two ways to analyze this case, which perhaps is being appealed to the Pennsylvania Supreme Court. One is that a procedural glitch prevented the court from getting to the root of the problem and that had the issues been presented in accordance with the procedural rules it would have reached a different conclusion. The other is that even if the court considered those other two issues it would still have concluded, based on its reasoning, that so long as there were no irregularities in the sale, the sale was valid and the property owner’s equity shifted to the buyer.

The story about the homeowner’s loss of her home and her equity in it revealed that according the Channel 6 in Philadelphia, the company that purchased the homeowner’s property has purchased 62 properties since 2011. It is not the only company engaged in this practice.

Several Pennsylvania legislators have introduced a bill designed to stop these situations from happening through a change in the notice procedure. It would permit homeowners to designate an agent who would also receive the notices. This would protect homeowners who for some reason don’t receive the notices, or receive them but fail to act perhaps because their faculties are declining, are in the hospital, or dealing with some other setback. However, this does not solve the problem. The problem is that the taxing authority is permitted to sell the property for less than its fair market value. In a time when housing is scare and prices high, it is puzzling that no one showed up to acquire a $247,000 property for more than $14,000. Surely someone wanting to purchase a home similar in size, features, and location to the one in question but who could, and was willing to, pay, say, $150,000 or some similar amount would have jumped at the opportunity to make such a purchase. Why that did not happen is a question that can and should be asked of real estate agents who are representing buyers. Why not take the potential buyer, who is struggling to find a sufficiently sized yet affordable home, to these tax sale auctions?

Reader Morris sent me an email with the subject line, “Will eliminating taxes increase reading skills in Denmark?” Curious, I clicked on the link he gave me, a link to a EuroNews article explaining why Denmark is repealing its 25 percent value added tax on books. According to the article, Denmark is facing a literacy crisis, with 25 percent of 15-year-old “struggl[ing] to understand a simple text.”

Denmark’s Culture Minister commented that “he hopes the change will see more books flying off the shelves.” Though the repeal of the tax on books will cut government revenue, proponents of the repeal see it as “an investment in the country’s cultural future.”

Of course, the ability to read is not simply a matter of a nation’s cultural future. It’s a matter of life and death, because the inability to read road signs, medicine bottle labels, appliance and tool safety instructions, and a long list of other things increases the risks of traffic accidents, workshop injuries, unintentional overdoses and poisonings, and a long list of other tragedies.

Yet lowering the cost of books by repealing the tax on books will increase reading activity and book sales only if the reason youngsters are not reading from books is the impact of the tax. It is possible that someone might refrain from buying a $20 book because the tax raises the cost to $25 but I propose that the reason for the decline in reading skills lies in a different direction. And it’s an issue that extends far beyond the borders of Denmark.

The time once invested in reading is now invested in looking at and listening to screen. The decline has its origins not in the internet but in television and digital technology has merely accelerated that decline. The decline in reading isn’t a phenomenon limited to today’s youngsters. Many adults, today and even in the latter decades of the twentieth century and the first two decades of this one, read very little, especially reading for fun. The reasons include a lack of time, a problem faced by adults trying to raise children and hold down a job, but also the ease of watching or listening, especially when it is possible to watch or listen while doing various tasks.

Youngsters, who are somewhat more comfortable and certainly more adept with digital technology, are even more likely to turn to the screen unless they are required to read a book. And given that books can be read online or on a tablet or similar device, purchasing a book in “hard format” is an idea that continues to attract fewer and fewer people as the years pass.

Getting people, particularly youngsters and students, to use print books perhaps is near impossible or very difficult. Most prefer audiobooks and videos. One popular remedy, banning screens from classrooms, has a negative effect. I speak from experience. Student achievement increased as I incorporated more and more digital technology into my teaching. This included front-of-the-room screens and the administration of mini-exams requiring responses inputted through computer or phone internet connections to my laptop. The front-of-the-room screen in the classroom, in many ways, is nothing more than a modernized blackboard. It still required students to have the ability to read. As pointed out in the preceding paragraph, a person can read from something on a screen.

The reading problem isn’t the screen per se. It’s the failed use of the screen, when there is accompanying audio that simply repeats the words on the screen, or when the screen is text-free, as is the case with many video games. Worse, too often what is on the screen is too short, or uses oversimplified vocabulary, and becomes nothing more than a visual version of a misleading audio sound bite. The worst versions are the videos that contain only text and that take 10 times as much time to hear as would be required simply to read the text.

The issue ultimately isn’t the purchase and use of books, though some of us, myself included, simply enjoy holding a book to read. Yet more and more of my reading has shifted from paper books to the digital environment. The issue is finding ways to teach and encourage people, especially youngsters, to read text whether on a printed page or a screen.

So is the tax law the avenue for encouraging people to read? No. Slightly reducing the price of books impacts only the very few who choose to buy a book for $20 but not $25. Tax credits or deductions for buying books would do nothing more than open the door to wholesale fraud, to say nothing of the challenges presented when trying to administer such provisions.

At the end of July, in Do IRS Agents Watch Television Court Shows?, I explained that reader Morris had found a story that disclosed how an IRS agent watching Real Housewives of New Jersey noticed some things that led to and IRS audit. Reader Morris was responding to a question I had asked a little more than eight years ago, in People’s Court: So Who Did the Tax Cheating?. I had asked, “Do IRS employees watch television court shows?” In last month’s post, I shared my opinion that “The news that an IRS agent was watching a reality show does not answer the question of whether IRS agents watch television court shows.” I concluded with this request: “Perhaps an IRS agent, or a friend or relative of an IRS agent, is willing to share that they watch television court shows. Perhaps they watch simply to be entertained. Perhaps they watch in order to spot people and situations deserving of audits and investigations. If I get any responses, I’ll share them.”

I did get responses. Two. I suppose the next question will be, “Do IRS agents read my blog?” Well, at least two have. Both of the respondents are retired. One simply said, “If I did, how would I know where these people live unless they post their appearance on their social media pages?” My reaction is that finding someone isn’t as difficult as one might think, and the IRS surely has ways of finding someone that isn’t as difficult as those who are simply using internet sites or social media.

The other “noted that IRS agents do watch television court shows, along with other shows, for entertainment purposes, and if they see something on the show or on social media, news, or some other source and there appears to be a potential tax violation they can refer it for further attention.” So there’s no agency-wide policy of watching television court shows, but there are procedures in place if an agent happens to notice something awry when watching television court shows (and probably other television shows, such as news reports).

So advice to people appearing on television court shows should include the same advice given to people on social media. Think before you write or speak or post. One never knows who is watching, reading, or listening.

It’s time again to look at the mileage-based road fee, a topic that has had my attention for almost 17 years, in posts such as Tax Meets Technology on the Road, Mileage-Based Road Fees, Again, Mileage-Based Road Fees, Yet Again, Change, Tax, Mileage-Based Road Fees, and Secrecy, Pennsylvania State Gasoline Tax Increase: The Last Hurrah?, Making Progress with Mileage-Based Road Fees, Mileage-Based Road Fees Gain More Traction, Looking More Closely at Mileage-Based Road Fees, The Mileage-Based Road Fee Lives On, Is the Mileage-Based Road Fee So Terrible?, Defending the Mileage-Based Road Fee, Liquid Fuels Tax Increases on the Table, Searching For What Already Has Been Found, Tax Style, Highways Are Not Free, Mileage-Based Road Fees: Privatization and Privacy, Is the Mileage-Based Road Fee a Threat to Privacy?, So Who Should Pay for Roads?, Between Theory and Reality is the (Tax) Test, Mileage-Based Road Fee Inching Ahead, Rebutting Arguments Against Mileage-Based Road Fees, On the Mileage-Based Road Fee Highway: Young at (Tax) Heart?, To Test The Mileage-Based Road Fee, There Needs to Be a Test, What Sort of Tax or Fee Will Hawaii Use to Fix Its Highways?, And Now It’s California Facing the Road Funding Tax Issues, If Users Don’t Pay, Who Should?, Taking Responsibility for Funding Highways, Should Tax Increases Reflect Populist Sentiment?, When It Comes to the Mileage-Based Road Fee, Try It, You’ll Like It, Mileage-Based Road Fees: A Positive Trend?, Understanding the Mileage-Based Road Fee, Tax Opposition: A Costly Road to Follow, Progress on the Mileage-Based Road Fee Front?, Mileage-Based Road Fee Enters Illinois Gubernatorial Campaign, Is a User-Fee-Based System Incompatible With Progressive Income Taxation?. Will Private Ownership of Public Necessities Work?, Revenue Problems With A User Fee Solution Crying for Attention, Plans for Mileage-Based Road Fees Continue to Grow, Getting Technical With the Mileage-Based Road Fee, Once Again, Rebutting Arguments Against Mileage-Based Road Fees, Getting to the Mileage-Based Road Fee in Tiny Steps, Proposal for a Tyre Tax to Replace Fuel Taxes Needs to be Deflated, A Much Bigger Forward-Moving Step for the Mileage-Based Road Fee, Another Example of a Problem That the Mileage-Based Road Fee Can Solve, Some Observations on Recent Articles Addressing the Mileage-Based Road Fee, Mileage-Based Road Fee Meets Interstate Travel, If Not a Gasoline Tax, and Not a Mileage-Based Road Fee, Then What?>, Try It, You Might Like It (The Mileage-Based Road Fee, That Is) , The Mileage-Based Road Fee Is Superior to This Proposed “Commercial Activity Surcharge”, The Mileage-Based Road Fee Is Also Superior to This Proposed “Package Tax” or “Package Fee”, Why Delay A Mileage-Based Road Fee Until Existing Fuel Tax Amounts Are Posted at Fuel Pumps?, Using General Funds to Finance Transportation Infrastructure Not a Viable Solution, In Praise of the Mileage-Base Road Fee, What Appears to Be Criticism of the Mileage-Based Road Fee Isn’t, Though It Is a Criticism of How Congress Functions, Ignorance and Propaganda, A New Twist to the Mileage-Based Road Fee, The Mileage-Based Road Fee: Simpler, Fairer, and More Efficient Than the Alternatives, Some Updates on the Mileage-Based Road Fee, How to Pay for Street Reconstruction, Stop the "Stop EV Freeloading Act" Because The Mileage-Based Road Fee Is a Much Better Way to Go, Why Is Road Repair and Maintenance Funding So Difficult for Public Officials to Figure Out?, Should (Will) Implementing the Mileage-Based Road Fee Cause Privatization of Highway Infrastructure?, The Freedom Caucus Doesn’t Understand that the Mileage-Based Road Fee is “PRO-Freedom,” Not the Opposite, A Mileage-Based Road Fee by Any Other Name?, Does the Mileage-Based Road Fee Work for Local Road Maintenance?, Washington State Mileage-Based Road Fee Proposal Changes: Is It Better?, and The Mileage-Based Road Fee Is Much Better Than a Federal Fuel Tax Increase.

Several days ago reader Morris directed my attention to an opinion piece on Freightwaves from 2021 that asked “What would a vehicle mileage tax mean for ride-share?” In examining that question the article repeats concerns that I have addressed in previous commentaries.

With respect to ride sharing, the article suggests that privacy concerns would discourage ride-share drivers from driving as much as they currently do, as the author gleans from surveys taken from ride-share drivers. The basis for this prediction, according to those drivers, is the presumed use of GPS technology used to track vehicle mileage. The concern certainly cannot be the tracking of mileage, because as I have explained more than once in previous commentaries, odometers track mileage and when vehicles are taken in for inspection the inspecting mechanic records the odometer reading. So, too, do many states when the annual vehicle registration application is submitted. Insurance companies also track the miles driven by insured drivers because it affects rate setting. The concern apparently is the ability of GPS information to provide a viewer the location that a vehicle is in or has visited over the period of time during which mileage is being computed. Yet other than when vehicles are in private garages, vehicles are out in the public and can be seen by whomever observes them. The notion of privacy makes little sense when an activity is being done in public. Of course, this presupposes GPS technology rather than odometer readings would be used to compute the mileage-based road fee. The only reason it would need to be used is to deal with states that want to impose the tax on out-of-state vehicles for which they do not receive odometer readings. As a practical matter, GPS technology already exists in modern vehicles, used, for example, for emergency services requests. So why the concern? Perhaps drivers who are charging customers for rides don’t want to leave evidence of the routes they took. Why? If the stories about taxi drivers and ride-share drivers taking customers on circuitous routes to jack up the cost are true, then perhaps those drivers might be wary of letting evidence exist of their route choices. And, of course, busy drivers don’t need to do that because they want to get passengers delivered as quickly as possible so they can pick up their next fare, which brings in more revenue due to higher initial mile charges and flat fees than would investing time racking up phantom miles for a passenger on a trip already underway. Another concern is that GPS data can reveal whether a driver is violating traffic laws such as those imposing speed limits, but frankly, I have no sympathy for those who resist technology because it impedes law breaking. As a practical matter, as increasing numbers of speed cameras and traffic light cameras are installed, focusing on GPS as a threat to traffic law breaking will becoming increasingly misdirected. So either the privacy concerns are misplaced or the result of keen awareness of the impact of technology on questionable driving and fare-charging practices.

The article also shares concerns about accessibility. It points out that older vehicles do not have built-in GPS technology or the OBD-II port that can be, and often is, used to connect the devices used to track mileage. The OBD-II port became standard in 1996, though not in diesel vehicles until 2006). How many 30-year-old non-diesel vehicles are still on the road? How many 20-year-old diesel vehicles are still on the road? There are some, but their numbers are decreasing, and by the time federal and state governments get around to replacing antiquated fuel taxes with a mileage-base road fee, which will be when highways, bridges, and tunnels are disintegrating en masse, the only non-OBD-II-port vehicles still on the road will be classics, which for the most part are driven so little that they probably are worth an exception.

The article, though, claims that the “tech also experiences problems when paired with electric, hybrid and alternative fuel vehicles,” and that “ For drivers of older models or vehicles with alternate fuel sources, that means a VMT tax isn’t feasible — their cars simply won’t fit into the system.” Though I understand the issue with respect to very old vehicles, as addressed in the preceding paragraph, I don’t understand the premise that electric, hybrid, and alternative fuel vehicles are not, or cannot be, fitted with GPS technology. In fact, to the best of my knowledge, these more recent high-tech vehicles rely heavily on GPS and internet connectivity, and have odometers – or their digital equivalents – to keep track of miles driven for a variety of purposes, including recharging or refueling.

The article expressed concerns that a mileage-based road fee “could disproportionately impact low-income drivers.” First, has anyone done computations to demonstrate that the mileage-based road fee would generate a higher cost than the amount paid at the pump for federal and state fuel taxes? Second, just as ride-share drivers factor fuel taxes into the rate they charge customers, so too they can factor in the mileage-based road fee when making that determination. The article also notes that some states are charging mileage-based road fees in addition to, rather than as replacements for, fuel taxes. That is an important observation, and one that causes me to point out that my proposal, along with most others, would REPLACE fuels taxes with the mileage-based road fee and not permit it to be an additional charge.

Next, the article notes that ride-share drivers “are routinely paid less than minimum wage.” That is, of course, something that should not be happening. Yet it isn’t caused by fuel taxes, nor would it be caused by mileage-based road fees. It is caused by the same business practice that causes wage underpayments throughout too many industries. Ride-share companies need to compensate drivers sufficiently to cover the costs encountered by the drivers and for the time they invest in driving.

Finally, the article concludes, “For the ride-share industry to survive a VMT tax, the model requires some major tweaks by policymakers. They’ll have to * * * enact variable pricing that takes into account things like a person’s income or job status.” That makes no sense. No one pulls up to a gasoline pump and selects from an assortment of fuel tax rates based on income or job status. Existing tolls reflect miles driven on the toll road and are not adjusted for the driver’s income level or job status. The solution to the income-expense dilemma faced by ride-share drivers and too many other Americans does not sit within complex “tweaks” to a fuel tax or mileage-based road fee but within the much wider inequality structure that is afflicting American society and culture.

A little more than eight years ago, in People’s Court: So Who Did the Tax Cheating?, I asked, “Do IRS employees watch television court shows?” I asked that question in the context of television court cases where one or both of the parties disclose, perhaps without realizing it, that they have engaged in transactions that the IRS most likely would consider to be tax fraud, or at least worth an audit and a tax deficiency with or without civil penalties, if the IRS was aware of what had been disclosed.

When I asked that question, I did not know the answer. I still do not know the answer. Today, reader Morris pointed me in the direction of a Reality Blurb story, describing how the IRS caught up with a character on Real Housewives of New Jersey and successfully charged her with tax fraud. According to the director of IRS field operations, an IRS agent who happened to be watching the show and noticed that the character purchased furniture with $120,000 in cash.

The news that an IRS agent was watching a reality show does not answer the question of whether IRS agents watch television court shows. Perhaps it makes a bit more likely. I did find a Reddit thread, in which someone described watching a Judge Judy episode in which she claimed many IRS agents watch the show to find tax cheaters. Some of the responses suggested she said this simply for sake of drama while others pointed out that it was possible, and still another asserted that there was not enough tax dollars involved in television court show cases to make it worthwhile for IRS agents to watch the shows. So reader Morris and I aren’t the only ones who wonder if IRS agents watch television court shows looking for tax violations.

Perhaps an IRS agent, or a friend or relative of an IRS agent, is willing to share that they watch television court shows. Perhaps they watch simply to be entertained. Perhaps they watch in order to spot people and situations deserving of audits and investigations. If I get any responses, I’ll share them.

I’ve been writing about the mileage-based road fee for almost 17 years. I have discussed it and other similar proposals, along with arguments made by those opposed to it, in posts such as Tax Meets Technology on the Road, Mileage-Based Road Fees, Again, Mileage-Based Road Fees, Yet Again, Change, Tax, Mileage-Based Road Fees, and Secrecy, Pennsylvania State Gasoline Tax Increase: The Last Hurrah?, Making Progress with Mileage-Based Road Fees, Mileage-Based Road Fees Gain More Traction, Looking More Closely at Mileage-Based Road Fees, The Mileage-Based Road Fee Lives On, Is the Mileage-Based Road Fee So Terrible?, Defending the Mileage-Based Road Fee, Liquid Fuels Tax Increases on the Table, Searching For What Already Has Been Found, Tax Style, Highways Are Not Free, Mileage-Based Road Fees: Privatization and Privacy, Is the Mileage-Based Road Fee a Threat to Privacy?, So Who Should Pay for Roads?, Between Theory and Reality is the (Tax) Test, Mileage-Based Road Fee Inching Ahead, Rebutting Arguments Against Mileage-Based Road Fees, On the Mileage-Based Road Fee Highway: Young at (Tax) Heart?, To Test The Mileage-Based Road Fee, There Needs to Be a Test, What Sort of Tax or Fee Will Hawaii Use to Fix Its Highways?, And Now It’s California Facing the Road Funding Tax Issues, If Users Don’t Pay, Who Should?, Taking Responsibility for Funding Highways, Should Tax Increases Reflect Populist Sentiment?, When It Comes to the Mileage-Based Road Fee, Try It, You’ll Like It, Mileage-Based Road Fees: A Positive Trend?, Understanding the Mileage-Based Road Fee, Tax Opposition: A Costly Road to Follow, Progress on the Mileage-Based Road Fee Front?, Mileage-Based Road Fee Enters Illinois Gubernatorial Campaign, Is a User-Fee-Based System Incompatible With Progressive Income Taxation?. Will Private Ownership of Public Necessities Work?, Revenue Problems With A User Fee Solution Crying for Attention, Plans for Mileage-Based Road Fees Continue to Grow, Getting Technical With the Mileage-Based Road Fee, Once Again, Rebutting Arguments Against Mileage-Based Road Fees, Getting to the Mileage-Based Road Fee in Tiny Steps, Proposal for a Tyre Tax to Replace Fuel Taxes Needs to be Deflated, A Much Bigger Forward-Moving Step for the Mileage-Based Road Fee, Another Example of a Problem That the Mileage-Based Road Fee Can Solve, Some Observations on Recent Articles Addressing the Mileage-Based Road Fee, Mileage-Based Road Fee Meets Interstate Travel, If Not a Gasoline Tax, and Not a Mileage-Based Road Fee, Then What?>, Try It, You Might Like It (The Mileage-Based Road Fee, That Is) , The Mileage-Based Road Fee Is Superior to This Proposed “Commercial Activity Surcharge”, The Mileage-Based Road Fee Is Also Superior to This Proposed “Package Tax” or “Package Fee”, Why Delay A Mileage-Based Road Fee Until Existing Fuel Tax Amounts Are Posted at Fuel Pumps?, Using General Funds to Finance Transportation Infrastructure Not a Viable Solution, In Praise of the Mileage-Base Road Fee, What Appears to Be Criticism of the Mileage-Based Road Fee Isn’t, Though It Is a Criticism of How Congress Functions, Ignorance and Propaganda, A New Twist to the Mileage-Based Road Fee, The Mileage-Based Road Fee: Simpler, Fairer, and More Efficient Than the Alternatives, Some Updates on the Mileage-Based Road Fee, How to Pay for Street Reconstruction, Stop the "Stop EV Freeloading Act" Because The Mileage-Based Road Fee Is a Much Better Way to Go, Why Is Road Repair and Maintenance Funding So Difficult for Public Officials to Figure Out?, Should (Will) Implementing the Mileage-Based Road Fee Cause Privatization of Highway Infrastructure?, The Freedom Caucus Doesn’t Understand that the Mileage-Based Road Fee is “PRO-Freedom,” Not the Opposite, A Mileage-Based Road Fee by Any Other Name?, Does the Mileage-Based Road Fee Work for Local Road Maintenance?, and Washington State Mileage-Based Road Fee Proposal Changes: Is It Better?

Today, reader Morris directed my attention to a proposal by the Truckload Carriers Association for a "Gallons-Based User Fee” or GBUF. Though described as a “simple, common-sense update to the current fuel tax,” it is nothing more than an increase in the existing federal fuel tax along with an “annual registration fee for electric vehicles.” That fee would be $250 annually for electric vehicles and $100 annually for hybrid vehicles. The proposal also includes repeal of the federal 12 percent excise tax on new trucks and trailers. The proponents of GBUF make two arguments. First, they argue that the “federal fuel tax is the most efficient and cost-effective way to fund highway improvements.” Second, they argue that the GBUF “does not require a new collection system or a costly bureaucracy.” They don’t mention that they are not so subtly changing the designation of the revenue from a tax to a user fee, perhaps to make it appear new or perhaps, and more likely, to avoid accusations of supporting a tax increase, something that finds little favor these days.

The proponents make no mention of the fact that some states have already implemented the mileage-based road fee in some form, whether as a pilot program, a voluntary opt-in arrangement, or some similar plan. Though the mileage-based road fee does not require a costly bureaucracy because it would rely on existing vehicle and internet technology to calculate and impose the fee, it easily could be adapted so that states use their fee collection system to collect revenue on behalf of the federal government and remit those collections to the Treasury.

I wonder if one of the reasons the Truckload Carriers Association prefers raising the fuel tax instead of opting for a more accurate mileage-based road fee is that the road fee takes into account the weight of the vehicle, because the heavier the vehicle the more damage to the roads, bridges, and tunnels. For example, compare a 10,000 pound diesel powered box truck with an 80,000 pound diesel powered tractor trailer. The former gets between 13 to 20 miles per gallon whereas the latter gets between 6 to 8 miles per gallon. So to go the same distance of 1000 miles, the tractor-trailer would use between 125 to 167 gallons whereas the box truck would use between 50 and 77 gallons. The tractor trailer would use between 1.6 to 3.3 times as much fuel to cover that distance, and would pay between 1.6 to 3.3 times as much fuel tax. Yet the tractor trailer does far more than 1.6 to 3.3 times as much damage to the roads, bridges, and tunnels. According to the GAO’s Truck Weight and Its Effect on Highways, an 80,000 pound tractor trailer “has the same impact on an interstate highway as 9,600 automobiles,” and “a truck axle carrying 18,000 pounds is only 9 times heavier than a 2,000-pound automobile axle, it does 5,000 times more damage.” In effect, the current fuel tax system, no matter the amount of the per-gallon tax, causes lighter weight vehicles to subsidize a significant portion of the damage done by heavier weight vehicles. The mileage-based road fee, with rates set to match vehicle weights, ameliorates this funding imbalance.

Just as bad, a flat fee for electric and hybrid vehicles presupposes that those vehicles do the same damage to highway infrastructure when, in fact, the miles that each of those vehicles are driven can vary from as little as 2,000 annually to as much as 30,000 or more annually. The mileage-based road fee takes those differences into account. The flat fee does not. On top of this flaw, though the GBUF proponents claim that their proposal “does not require a new collection system or a costly bureaucracy,” it indeed would require a new federal mechanism to impose those flat fees.

In conclusion, though raising the federal fuel tax is better for preservation of federally supported highway infrastructure than doing nothing, it pales in comparison to implementing a mileage-based road fee. Fairness and efficiency weigh in favor of a permanent remediation rather than the seemingly easier but eventually ineffective band-aid of raising a 20th century tax mechanism that doesn’t function well in a 21st century world.

Another interesting television court show popped up, and, yes, it involved taxes. As readers know, I have addressed tax issues in television court shows many times, in posts such as Judge Judy and Tax Law, Judge Judy and Tax Law Part II, TV Judge Gets Tax Observation Correct, The (Tax) Fraud Epidemic, Tax Re-Visits Judge Judy, Foolish Tax Filing Decisions Disclosed to Judge Judy, So Does Anyone Pay Taxes?, Learning About Tax from the Judge. Judy, That Is, Tax Fraud in the People’s Court, More Tax Fraud, This Time in Judge Judy’s Court, You Mean That Tax Refund Isn’t for Me? Really?, Law and Genealogy Meeting In An Interesting Way, How Is This Not Tax Fraud?, A Court Case in Which All of Them Miss The Tax Point, Judge Judy Almost Eliminates the National Debt, Judge Judy Tells Litigant to Contact the IRS, People’s Court: So Who Did the Tax Cheating?, “I’ll Pay You (Back) When I Get My Tax Refund”, Be Careful When Paying Another Person’s Tax Preparation Fee, Gross Income from Dating?, Preparing Someone’s Tax Return Without Permission, When Someone Else Claims You as a Dependent on Their Tax Return and You Disagree, Does Refusal to Provide a Receipt Suggest Tax Fraud Underway?, When Tax Scammers Sue Each Other, One of the Reasons Tax Law Is Complicated, An Easy Tax Issue for Judge Judy, Another Easy Tax Issue for Judge Judy, Yet Another Easy Tax Issue for Judge Judy, Be Careful When Selecting and Dealing with a Tax Return Preparer, Fighting Over a Tax Refund, Another Tax Return Preparer Meets Judge Judy, Judge Judy Identifies Breach of a Tax Return Contract, When Tax Return Preparation Just Isn’t Enough, Fighting Over Tax Dependents When There Is No Evidence, If It’s Not Your Tax Refund, You Cannot Keep the Money, Contracts With Respect to Tax Refunds Should Be In Writing, Admitting to Tax Fraud When Litigating Something Else, When the Tax Software Goes Awry. How Not to Handle a Tax Refund, Car Purchase Case Delivers Surprise Tax Stunt, Wider Consequences of a Cash Only Tax Technique, Was Tax Avoidance the Reason for This Bizarre Transaction?, Was It Tax Fraud?, Need Money to Pay Taxes? How Not To Get It, When Needing Tax Advice, Don’t Just “Google It”, Re-examining Damages When Tax Software Goes Awry, How Is Tax Relevant in This Contract Case?, Does Failure to Pay Real Property Taxes Make the Owner a Squatter?, Beware of the Partner’s Tax Lien, Trying to Make Sense of a “Conspiracy to Commit Tax Fraud”, Tax Payment Failure Exposes Auto Registration and Identity Fraud, A Taxing WhatAboutIsm Attempt, When Establishing A Business Relationship, Be Consistent, as the Alternative Can Be Unpleasant Litigation, Sadness on Multiple Levels: Financial Literacy, Factual Understanding, Legal Comprehension, When the Lack of Facts Produces “Rough Justice” in a Tax-Related Case, Is the Tax Return Preparer or the Client Responsible For Unjustified Deductions?, Tax Might Be Boring, But the Underlying Facts Often Are Not, When Tax Fraud Is Admitted in a Civil Arbitration Proceeding Known As a Television Court Show, and When Allegations Go Unproven: Did a Television Court Show Involve Tax Fraud.

This particular television court show was episode 176 of season 10 of Hot Bench, which originally aired on 19 August 2024. I could not find the actual episode online other than behind some unfamiliar pay sites.

The plaintiff and defendant worked for the same contractor. The defendant did not want to fill out a W-9 for the contractor because, as the defendant admitted, he was in arrears on child support and did not want the IRS to know he had wages that could be used to pay the child support obligations.

So the contractor, the plaintiff, and the defendant entered into an arrangement that made the plaintiff, in effect, a subcontractor. Under the arrangement, the contractor would remit to the plaintiff the wages that would have been paid to the defendant, and the plaintiff would pay that amount to the defendant. The plaintiff made the payments in cash because the defendant refused to accept a check.

The plaintiff had three other employees. Those employees filled out W-9 forms delivered to the plaintiff, and the plaintiff paid those employees with checks.

According to the plaintiff, a fourth W-9, in a name other than the defendant’s, was included with the other three W-9 forms, when the plaintiff’s tax returns were prepared by the plaintiff’s tax return preparer. The defendant denied filling out a W-9 form. When asked about this W-9 form, the plaintiff testified he had not looked at it and did not realize it had a name other than the defendant’s name. One of the judges asked the plaintiff if it was not strange that the defendant, who refused to fill out a W-9 for the contractor, would have filled out a W-9 form for the plaintiff.

The IRS and the California Franchise Tax Board sent notices to the plaintiff that taxes had not been remitted for the payments made to the defendant. The plaintiff did not have those documents to present as evidence for the explanations provided by those two agencies. The IRS and the Franchise Tax Board levied on the plaintiff’s bank account. The plaintiff sued the defendant, seeking reimbursement from the defendant.

One judge noted that the failure to bring the documents issued by the agencies made it difficult to conclude that the amounts taken were on account of the payments made to the defendant by the plaintiff. The court found the plaintiff’s explanations inadequate to justify a decision in his favor. The court also pointed out that the arrangement into which the parties entered meant that the plaintiff was coming into court with “unclean hands.” The court also noted that the plaintiff waited three years to bring the lawsuit against the defendant. During the deliberations, the judges observed that the plaintiff could have turned to the IRS and Franchise Tax Board to explain that those agencies had made an error and that he did not have an employee with the name on the W-9 form, and that he had not done so.

For these reasons, the court dismissed the plaintiff’s complaint. That conclusion was not a surprise. As I watched the episode, very early on I knew what the outcome would be, because the unclean hands doctrine was so readily apparent. The defendant could not have been more obvious in declaring a refusal to fill out a required tax form because of a desire to hide wages from the IRS. The plaintiff knew what was being planned and went along with the scheme. Unfortunately, the contractor was not in court and could not be questioned, especially the question asked by one of the judges during deliberations, which was why not simply fire an employee who refused to fill out and submit to the employer a required W-9 form.

It’s time to revisit the world of tax return preparers who get into serious trouble because of misdeeds. I have written about tax return preparers in posts such as Tax Fraud Is Not Sacred, More Tax Return Preparation Gone Bad, Another Tax Return Preparation Enterprise Gone Bad, Are They Turning Up the Heat on Tax Return Preparers?, Surely There Is More to This Tax Fraud Indictment, Need a Tax Return Preparer? Don’t Use a Current IRS Employee, Is This How Tax Return Preparation Fraud Can Proliferate?, When Tax Return Preparers Go Bad, Their Customers Can Pay the Price, Tax Return Preparer Fails to Evade the IRS, Fraudulent Tax Return Preparation for Clients and the Preparer, Prison for Tax Return Preparer Who Does Almost Everything Wrong, Tax Return Preparation Indictment: From 44 To Three, When Fraudulent Tax Return Filing Is Part of A Bigger Fraudulent Scheme, Preparers Preparing Fraudulent Returns Need Prepare Not Only for Fines and Prison But Also Injunctions, Sins of the Tax Return Preparer Father Passed on to the Tax Return Preparer Son, Tax Return Preparer Fraud Extends Beyond Tax Returns, When A Tax Return Preparer’s Bad Behavior Extends Beyond Fraud, More Thoughts About Avoiding Tax Return Preparers Gone Bad, Another Tax Return Preparer Fraudulent Loan Application Indictment, Yet Another Way Tax Return Preparers Can Harm Their Clients (and Employees), When Unscrupulous Tax Return Preparers Make It Easy for theblo IRS and DOJ to Find Them, Tax Return Preparers Putting Red Flags on Clients’ Returns, When Language Describing the Impact of Tax Fraud Matters, Injunctions Against Fraudulent Tax Return Preparers Help, But Taxpayers Still Need to Be Vigilant, Will the Re-Introduced Legislation Permitting Tax Return Preparer Regulation Be Enacted, and If So, Would It Make a Difference?, Can Fraudulent Tax Return Preparation Become An Addiction?, Tax Return Preparers Who Fail to File Their Own Returns Beg For IRS Attention, Using a Tax Return Preparer? Take Steps to Verify What Is Filed on Your Behalf, When Dishonest Tax Return Preparers Are Married, There Was Nothing Magical About This Tax Return Preparation Business, Don’t Get Burned By a Tax Return Preparer, Tax Fraud School: When It’s Not Enough to Be a Fraudulent Tax Return Preparer, It’s Not Just Tax Return Preparers Assisting in the Preparation of Fraudulent Tax Returns, Overused Fraudulent Tax Return Preparation Ploys, It’s Not Just Law Enforcement That Confronts Misbehaving Tax Return Preparers, When An Injunction Doesn’t Stop a Tax Return Preparer from Filing False Returns, Filing a Fraudulent Tax Return Is Bad, Filing More Than 3,000 Is Outrageously Bad, When It Comes to Fraudulent Tax Returns, It's Not Always the Preparers, A Procedural Twist on Dealing with Fraudulent Tax Return Preparers, Can Tax Return Preparers Learn from the Misdeeds of Other Preparers?, Should Tax Return Preparers Use Their Full Legal Names?, Is There Ever a Free Lunch, Even in the Tax Return Preparation Business?, Is the Tax Return Preparer or the Client Responsible For Unjustified Deductions?, and When Preparing False Tax Returns Seems to Lack a Financial Motive.

What got my attention this time wasn’t the fact that a tax return preparer filed fraudulent returns on behalf of clients, many of whom did not know he had claimed credits on their returns to which they were not entitled. It was the fact that after being convicted and while awaiting sentencing he continued to prepare fraudulent returns.

According to a Department of Justice press release issued yesterday, a Yeadon, Pa., tax preparer was sentenced to three years in prison, one year of supervised release, a $10,000 fine, and $12,717 in restitution, for “knowingly and willfully including false energy credits in tax forms that he prepared for paying customers.” He did this for tax years 2018 through 2020, preparing at least 146 returns “that falsely offset tax liabilities or claimed reimbursable credits for money allegedly spent on wind turbines, solar panels, or other energy improvements.” According to the Department of Justice, he did this “because he wanted to increase client refunds and client satisfaction.” These false returns “caused his clients to understate their tax liabilities by more than $700,000.” In September of 2024, the preparer “pleaded guilty to an information charging him with one count of aiding and assisting in the preparation of a false tax return, and admitted to filing the other 145 false returns, along with his own false returns for the same three tax years.” The restitution is for the taxes he evaded on his own return. His clients are responsible, unfortunately, for the understated taxes on their returns.

It wasn’t the press release that drew my attention to the case. It was this article in this morning’s Philadelphia Inquirer. It may be behind a paywall, but I’ve not been able to find any other online source for the additional information revealed in the article. According to the article, after pleading guilty, the preparer continued to prepare tax returns. Court officials and the Department of Justice were initially unaware of this development. When they discovered that the preparer continued to prepare tax returns, they figured out that he did so using his mother’s electronic filing identification number. By the time his continued tax return preparation activities were discovered he had filed more than another one thousand returns. During court proceedings, the preparer claimed he was no longer working as a preparer, and making money by doing Lyft and Uber driving and doing home health services. When the sentencing hearing was postponed because of the discovery, the preparer did not stop and filed another 70 returns using his mother’s identification number.

Though the prosecutors asked that the prepare be sentenced to 41 to 51 months in prison, the judge limited the sentence to three years. Three years is the statutory maximum for the offenses to which the preparer had pleased guilty. It is unclear whether additional chargers will be brought. I suppose it depends on whether there were fraudulent claims on the more than 1,000 additional returns he prepared and on whether prosecutors decide to pursue perjury charges for his false testimony that he had stopped preparing returns.

So is it foolishness or courage when a person continues to engage in behavior that causes the person to be indicted and convicted of – or to plead guilty to – criminal tax fraud charges? We often hear the question, “What were they thinking?” and often the answer is, “They weren’t.” But in this instance the use of the mother’s identification number suggests that the continued tax return preparation activity, together with the denial that it was underway, was not simply accidental or negligent. The Philadelphia Inquirer article notes that the preparer “has a master’s degree and kept up with annual tax-prep training.” Wondering if “master’s degree” meant an LL.M. (Taxation) or a Masters of Taxation, I checked and learned that he has an M.B.A. and not a tax degree. Yet one would think that “annual tax-prep training” would include warnings about the impropriety and illegality of claiming deductions and credits for which taxpayers are not eligible as well as the risks of getting caught and the consequences that flow from preparing and filing false returns.

I’ve been asked why I haven’t been commenting on the federal legislation that would extend and enlarge tax cuts and tax breaks for wealthy individuals and corporations. The answer is simple. What else am I going to say? I've explained in the past, many times, that giving tax breaks and low or zero tax rates to the wealthy and corporations does not create jobs. Jobs are created when there is a demand for the goods and services being provided by a seller. As more wealth is shifted from the poor and especially the middle class, demand from those sectors, which constitute almost all of the economy, will go down. Add to that tariffs, and demand will drop even more. When demand goes down, the economy shrinks. Fewer and fewer jobs are created and more and more workers are dismissed. How do I know this? I went to Wharton. I went to class. I earned my degree.

For some reason I have not always written a Memorial Day essay over the 21-plus years MauledAgain has existed. I don’t know why. I do know that I have written not only about the memories of those who have fallen in service to this nation but also about the freedom for which they fought and died. Freedom, it seems to me, is an oft-misunderstood concept. In 2023, in Indeed, Freedom Is Not Free, I explained why freedom is not the same thing as unregulated behavior. Last year, in Freedom To Do or Freedom From or Both?, I concluded that there are two sides to freedom, “freedom to do” and “freedom from.” These concepts are mutual, because “freedom to do” is simply “freedom from” regulation, authority, and social constraint, and “freedom from” is simply “freedom to do” whatever is being escaped.

So many of the articles, commentaries, broadcasts, social media postings, cartoons, and memes that address Memorial Day proclaim respect, appreciation, and gratitude for those who fought and died to protect “our freedoms.” In other words, they fought FOR freedom. They fought to DEFEND freedom. But against whom or what have they fought? Freedom needs protection and defense only if there is something that opposes freedom. There are all sorts of names for what opposes freedom, ranging from repression through authoritarianism to totalitarianism, and many hours and words have been devoted to debates over which of these words properly describe what stands in the way of freedom. But does it matter? All of these movements, ideologies, and worldviews can be lumped together under the term “anti-freedom.” Memorial Day is a day to honor those who fought against and died fighting anti-freedom.

Does it not make sense that the best way to honor those who fought and died defending freedom against anti-freedom is to follow a path that does not lead to, and does not wander through, the anti-freedom desert? Does it not make sense that following a freedom path requires those who are alive and benefitting from freedom do their part in standing up to anti-freedom when its ugly head reappears, as it has over the millennia during which humans have lived? Does it make sense to behave in the same manner as those against whom the defenders of freedom fought and sacrificed their lives in doing so? Of course not. It makes no sense to throw away all that was saved, protected, and cherished by those who fought and died, because to do so means that their lives were sacrificed in vain. Do we want them observing this nation and asking themselves, and asking us, “Why did we bother?”

Yet there are those who claim to be “freedom lovers,” many of whom join in Memorial Day tributes of one sort of another to our fallen heroes, whose behavior is frighteningly similar to that of those who posed the threats against freedom that sparked the battles and wars in which the heroes fell. How does one explain this incongruity? The answer rests in that tension between “freedom to do” and “freedom from” that I described in Freedom To Do or Freedom From or Both?. A simple example of this tension is the conflict between “freedom to do” 90 miles per hour on the highway and another person’s “freedom from” injury and death while driving. As I wrote in that post,

What makes the analysis particularly difficult on Memorial Day is a troubling tension between “freedom from” and “freedom to do.” On Memorial Day we remember and honor those who died to give this nation “freedom from” authoritarianism, dictatorship, repression, and ethnocentrism. Yet we also seem increasingly complacent when those who benefitted from the sacrifice of those we honor claim to have the “freedom to do” the very same behaviors the suppression of which was the purpose for which those we honor fought and died. It is particularly disturbing when people who profess a deep admiration for those who gave their lives to protect the nation from those enumerated evils are at the same time supporting people and policies that nurture and enlarge those same evils in this nation. What was the point of so many sacrifices to eliminate authoritarianism, dictatorship, repression, and ethnocentrism when there are people who want those same attributes to become the linchpin of this nation’s existence?

And now, a year later, it isn’t just a matter of those who are “increasingly complacent” but those who are “supportive” of those whose behavior, policies, and decisions are less aligned with the freedom for which many died and more aligned with the ideologies and goals of those who wear the hat of “anti-freedom.”

I’ve written several times that freedom has its limitations, and that it comes at a price. The price is not only the sacrifice of those who fought and died protecting it, but the recognition of those who benefit from freedom that there are limits to what freedom permits someone to do. Freedom does not provide permission to be, or support, anti-freedom. By definition, freedom cannot be, cannot support, and cannot abide, anti-freedom.

Fourteen years ago, in Music and the Tax Brain, I shared some thoughts about the connection between learning and performing music and learning and performing tax. I use the word “performing” rather loosely when referring to tax, but I include everything from preparing tax returns to teaching tax law, from analyzing the tax consequences of a planned transaction to analyzing facts relevant to tax policy decisions. In that commentary, I wrote:

Monday’s Philadelphia Inquirer brought a small item that described the results of research exploring the connection between childhood music lessons and long-term brain health. The headline caught my eye because I could relate to it. When I saw “Those clarinet lessons helped you tune up for your later years,” I had no practical choice but to keep reading. Why? When I was a child, my father taught me to play the clarinet. Or perhaps I should say that he tried to teach me. I made progress, but certainly not to the level that would open the doors to any concert hall. Part of my failure to progress competently was my resistance to what I perceived as an irrelevant instrument in the days when playing guitar – especially electric guitar – seemed to be the gateway to success in a variety of venues. My father would have nothing of rock music. * * * I, however, long ago abandoned the clarinet, though I still own several. I did not abandon my love of music, and dabble with keyboards, though quite inadequately.

So this Philadelphia Inquirer story suggested that I might owe my father an apology. According to the report, researchers examined 70 adults with similar levels of education and fitness, and who had no symptoms of Alzheimer’s disease. The adults were give a battery of cognitive tests. Who scored the best? Those with ten or more years of musical training. Who scored the lowest? Those with no musical training. Those running the study want to do more research, to determine if the cognitive performance enhancement is caused by the music lessons or by some other factor.

The lead research tossed out an idea that I found quite plausible. “Since studying an instrument requires years of practice and learning, it may create alternate connections in the brain that could compensate for cognitive declines as we get older.” If that indeed is the case, then would not the same cognitive achievement be attained by other endeavors requiring years of practice and learning? Certainly more research is in order.

So where does tax fit in? Two questions pop into my brain. Do years of practice and learning involving tax have the same effect as years of practice and learning involving music? Do years of practice and learning involving music make a person more proficient in learning tax? When I was a student in the basic federal income tax course, the professor often referred to “music majors” as a stereotype of students he expected to struggle in the course. Yet, my years of teaching have taught me that music majors do well in tax law. Though I’ve not conducted any empirical or laboratory research, I have convinced myself that the reason rests on the number of shared characteristics between music and tax law. Both require attention to detail. Both require careful reading. Both emphasize the need to recognize and apply patterns and sequences. Both are highly structured. Both are, to some extent, mathematical. Both involve interpretation. Both require precision. Both require the learning of a new language. The only difference between music and tax law that I could find has nothing to do with the learning process. Music makes almost everyone happy. That cannot be said about tax law.

This isn’t my first foray into the connections between tax and cerebral characteristics. Not long ago, in The Tax Brain, I asked:

Is there such a thing as a tax brain? Is there something to be said for the fact that most tax practitioners are proficient in semantic language processing and arithmetic calculation? Are there areas of a tax person’s brain that are larger or smaller than the typical brain, or that show higher or lower levels of activity? Are the brains of tax professionals awash with dopamine or with noradrenaline?

Now, to that list of questions, I add, “Do musicians and tax professionals find themselves in the same part of the intellectual family tree?” Perhaps a more important question is this: “Do tax professionals face a lower risk of cognitive decline as they get older?” There are plenty of anecdotes that I could share. What I prefer to see is an appropriately conducted study.

Note that I suggested both “Certainly more research is in order,” and “What I prefer to see is an appropriately conducted study.”

Today Reader Morris referred me to that fourteen-year-old commentary and directed my attention to two studies. The first, Education, occupational complexity, and incident dementia: A COSMIC collaborative cohort study, concludes that “The meta-analytic results indicated that both education and occupational complexity were independently associated with increased dementia-free survival time, . . .” The study did not dig to the granular level of analyzing the various complex occupations to determine whether tax professional and music professionals have different outcomes with respect to dementia-free survival time, let alone the many other complex professions in which people engage. Nor did the study explore – as it was not designed to focus on – the physical and neurological impact on the brain of engaging in music or tax for long periods of time at a more than superficial level.

The second study, described in this report, looked at the connection between occupations and Alzheimer’s disease (AD). In short, “Researchers have found that the risk of death due to AD is markedly lower in taxi and ambulance drivers compared with hundreds of other occupations. And the reason could be that these drivers develop structural changes in their brains as they work.” This difference did not show up when testing for dementia other than AD. The study suggested that perhaps the reason for this outcome is that ambulance and taxi drivers need to use “real-time spatial and navigational skills” in their jobs. Yet persons in other occupations requiring these skills, such as aircraft pilots and ship captains, not only did not experience the same low incidence of AD but “had some of the highest rates of death due to AD.” Bus drivers also did not benefit but fell within the average rate of death due to AD.

The study questions, “And why aren't bus drivers, pilots, and ship captains similarly protected? The study authors suggest these other jobs involve predetermined routes with less real-time navigational demands. Thus, they may not change the hippocampus as much.” I think there is something else involved. I see a difference between ambulance and taxi drivers on the one hand and bus drivers, aircraft pilots, and ship captains on the other, and I wonder if it matters. The former interact with their passengers (consider that ambulance drivers also function as EMTs) whereas the latter don’t interact or if they do, they interact infrequently and with less depth. Other studies, such as New Studies Suggest Social Isolation Is a Risk Factor for Dementia in Older Adults, Point to Ways to Reduce Risk, and Being Social May Delay Dementia Onset by Five Years, suggest that continued social engagement tends to lower dementia risk whereas it increases in older people who are isolated and have little or no social interaction.

And that brings me back to tax and music. Musicians engage in social contact, not only with other members of a chorus, orchestra, or band, but also with audiences, fans, promoters, agents, stage hands, and the entire array of people who interact with the performers. What about tax professionals? Despite the perception that “tax geeks” sit alone immersed in reading the Internal Revenue Code as a novel (though I did do that, years ago), tax professionals interact with clients, with co-workers, with other professionals, with federal, state, and local tax collectors and auditors, with employees, and sometimes with judges. Is this social interaction of sufficient amount? Can it be measured and compared to the social interaction of musicians and persons in other occupations? Perhaps these questions will be the subject of future studies.