Today’s round-up begins with this story from the Washington Post about tax evaders. This isn’t about tax resisters, exactly, just people who are trying to keep more of what belongs to them (and on second thought, maybe the distinction between tax evaders and tax resisters is a false one).

The article concerns a GAO report about tax evasion. Some of the meatier excerpts follow:

[T]he IRS recently told the White House that over the past two years it has linked more than 400,000 taxpayers to tax-evasion schemes that the agency says are likely to be found illegal. That number is considerably larger than the 131,000 the agency reported to congressional investigators this fall.…

[T]hese tax-evasion techniques and others are depriving the Treasury of up to $40 billion in unrealized taxes per year, more than the annual budget for the Department of Homeland Security.…

The GAO is adding its voice to a growing chorus of concern that the IRS is losing the battle against tax evasion. Last year, as then-IRS Commissioner Charles O. Rossotti was preparing to leave office, he disclosed that 60 percent of identified tax debts are not pursued, 75 percent of taxpayers who did not file a tax return are not pursued, and 79 percent of identified taxpayers who use abusive devices such as offshore accounts are not pursued.

[A] “single-minded” push to improve customer service… had diverted resources from enforcement and sent audit rates and criminal investigations plunging by as much as 30 percent. That coincided with “a real deterioration in taxpayer attitudes” about compliance with tax laws…

So the IRS is going to be stepping up their enforcement efforts, assuming they get the funding to do so. Insight on the News offers some educated guesses about where this enforcement will be concentrated. These include:

• Increased audits of small businesses
• More attacks on nonfilers
• Increased scrutiny of W-4 forms
• Targeting underreporters
• Criminal investigation and prosecution

The author notes that “the real problem with these actions is the error rate of the IRS. The agency continues to be wrong half the time with the assessment and collection actions it takes. Consequently, those accused of say, nonfiling, often are not non-filers at all. They are victims of some processing mishap that turns into their worst nightmare because of IRS enforcement action.”

The New York Press carries an interesting article about the recent redesign of the twenty dollar bill (Fancy Greens, Pusherman Blues):

[T]he new twenty puts the zap on the heads of people who routinely reintroduce hefty wads of currency from the underground economy to the aboveground one: money launderers and hoarders operating from considerable private cash holdings.

These people will tell you that the new look of money is the new status quo, and if they don’t want to be noticed, they’d better stay in step with the new status quo.

In New York City alone, wholesale drug resellers as close as two tiers above street-level distribution have begun asking buyers to separate older twenties from new ones to more quickly direct the old currency at laundering operations and retail purchases. The result is an accelerated rate of tax revenue for the U.S. government, one that it would not be enjoying if crime weren’t convinced that moving the old bills aboveground sooner rather than later means one less way to be detected by law enforcement.

I’ve been crowing lately about the potential advantages of the new Health Savings Accounts for folks like myself who are trying to stay under the tax line. There may be more where that came from. The Bush administration is trying to push for more types of tax-advantaged savings accounts:

The plan, announced nearly a year ago, would create three new kinds of savings accounts that would shield interest, capital gains and dividend income from all taxation. Most significantly, one of those vehicles, the Lifetime Savings Account, would allow an individual to invest up to $7,500 a year and withdraw the money at any time, for any reason, with no tax penalty and without paying taxes on earnings. Since a family of four could invest up to $30,000 a year free of investment taxation, the plan would all but eliminate taxes on investment and savings for most Americans.

That $7,500 isn’t tax-free, the way contributions to the Health Savings Accounts are, though — instead it would work kind of like a Roth IRA, where the money is taxed at your current tax rate before being deposited into the fund, but any earnings those deposits generate (via interest or investment appreciation) are never taxed. Improving on the Roth IRA, though, is that you don’t have to wait until “retirement age” to withdraw the money — you can get at the money any time you want, tax and penalty free.