Treasury IG calls for extra steps to increase proper farm income reporting.
The Treasury Inspector General for Tax Administration has released a report recommending increased Internal Revenue Service oversight to ensure that farmers are properly reporting subsidies and other income received from USDA's Commodity Credit Corporation.
The report says that farmers can pledge some or all of their production to get a CCC loan and make a special election to immediately recognize the loan proceeds as taxable income. In addition to loan proceeds, the report said farmers received billions of dollars of CCC payments in tax years 2003 through 2005. To monitor those who may be underreporting their income payments, the IRS relied on its examination and automated under-reporter programs.
The report said that while the expanded information should help increase the amounts of payments that are properly reported, IRS could take two additional steps that would enhance the effectiveness of the actions already taken.
The first step, the report said, involves reducing the number of information returns that IRS receives from USDA with inaccurate names and identification numbers. Second, IRS should explore strategies to address potentially millions of dollars of improperly reported CCC payments and suspected cases of underreporting that are not followed up on because of resource constraints, the report said.
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|Title Annotation:||Treasury Inspector General|
|Comment:||Treasury IG calls for extra steps to increase proper farm income reporting.(Treasury Inspector General)|
|Publication:||The Food & Fiber Letter|
|Article Type:||Brief article|
|Date:||Jun 15, 2009|
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