Posted on 12/07/2013 8:20:39 AM PST by markomalley
Agents from the Internal Revenue Service (IRS) are using Google Maps as part of their tool kit to audit taxpayers and organizations, The Daily Caller has learned.
A redacted IRS letter dated Sept. 8, 2011 reveals that at least in one case the IRS’s examiners used photos of a property, obtained through Google Maps, as evidence to revoke the 501(c)(4) status of a homeowner’s association.
“The road consists of a two-mile loop around the inside of the property. It goes not have any sidewalks or bicycle lanes. The examining agent printed and copied a map from Google Maps (www.google.com) into this report,” states the letter.
501(c)4 is a tax-exempt status that includes certain “social welfare organizations,” “local associations of employees,” “homeowners associations,” “volunteer fire companies,” and certain lobbying organizations.
The IRS became mired in scandal in May 2013 after a report by the Treasury Inspector General for Tax Administration found that IRS staffers had singled out tea party groups seeking 501(c)(4) tax-exempt status for extra scrutiny.
The agency did not return The Daily Caller’s request for comment for this report.
In formal guidance issued to IRS agents inspecting historical conservation sites, however, Google Maps and the online real estate database Zillow are mentioned as tools to help determine whether a property meets the regulatory requirements necessary to receive charitable contributions.
In addition to using freely available aerial and street photographs to survey property, agents are also encouraged to use search engines to research background information on suspected tax cheats.
“The Internet (using Google or other similar search engine) can be an excellent source of background information relevant to the taxpayer, done organization and appraiser,” states the agency’s manual.
The guidance, which is posted publicly online at the IRS’s website, was last revised on Jan. 3, 2012. An agency manual, effective Oct. 1, 2013, also lists Google, Google Maps, and a number of other Internet search tools to help agents spy on taxpayers.
In July 2012, according to USASpending.gov, the Treasury Department and the IRS awarded a $9,585 contract to Virginia-based information technology vendor ICS Nett, Inc. to pay for “Google Maps License and Maintenance.”
While Google Maps is a free service, users of the licensed “business” version are able to layer proprietary business data on top of Google Maps.
Google’s sale of licenses to an IRS contractor is curious, however, given the company’s professed outrage over government surveillance. Nor is the use of Google Maps by government tax collectors restricted to IRS agents in the U.S.
Government tax collectors in Lithuania, Estonia, Greece, and the U.K. have also used Google Maps and Google Street View against suspected tax dodgers.
The TaxProf Blog warned in 2010 that the practice was coming to the U.S. after witnessing it transpire in Greece.
Seeing the warning signs in Lithuania in early 2013, accounting firm Group 11 Advisors noted in a company blog post that while it was unclear as of then whether the IRS was using Google Maps and Google Street View to monitor people, it was engaging in electronic surveillance of “high-net-worth individuals[.]”
Such surveillance methods include the monitoring of Facebook posts, eBay listings and electronic credit card records.
“The added investigative capabilities made possible by technology makes it that much more important to ensure all necessary documents regarding assets are completed and filed according to IRS rules,” wrote Group 11 advisors.
The IRS and the Securities and Exchange Commission also came under fire earlier this year for exploiting a 1980s-era law, the Electronic Communications Privacy Act of 1986 ECPA), to monitor without a warrant the emails of individuals and organizations the agencies placed under investigation.
Privacy advocates at the Digital 4th coalition have been fighting to rein in the spying activities of both agencies by petitioning legislators and the White House to change the law so that government investigators will be required obtain a warrant for electronic communications.
As of 7:15pm ET on Friday, a petition on the White House website asking the Obama administration to weigh in on reforming ECPA had reached 60,362 signatures. The petition has until Dec. 12 to reach the 100,000 signature threshold required for a response from the White House.
And their numbers continue to grow.
Now even a road is pretext enough take, take, take.
OTOH, if you are in a city and pay taxes or fees against a general obligation bond, they are tax deductible.
As confusing as it may seem, the U.S. tax code is actually very consistent (from an accounting standpoint) when it comes to these things.
I don't see that as consistent.
“And, of course, there is nothing to stop an IRS agent from driving by your house to look around”
I remember someone telling me years ago that their town used Google Earth to increase property taxes on people with swimming pools that were plainly visible through the app; I can’t confirm that it was true.
Something I noticed is that as I get down closer and then in ‘Street View’ the view changes to several years back, same with Bing. I had a huge Oak tree taken off my front lawn five years ago that just went away, but the neighbor that moved out eight months ago is still showing his equipment and vehicles.
Is Google running ‘Street View’ at the behest of FedGov?
agreed... about 6 years ago we put a patio deck on the back of our house... the google photo, still shows our house without the deck.
This is what you get when we have a system where the government is charged with the responsibility of collecting taxes from income.
If we had a Fair Tax system, all of this would be completely moot would it not? The amount and source of income would be irrelevant.
That's because municipal taxes are tax deductible, while money paid to do maintenance and repairs on your personal residence are not.
This is very consistent across the board. The consistency is between the tax treatment of an owner of a detached home with no HOA and the owner of a unit in an HOA. The tax code applies uniformly to both types of owners, as long as both homes are used as primary residences.
I wasn't talking about personal residences but maintenance of common areas: HABITAT. Good grief.
It's not consistent.
It’s consistent because there’s a difference between common areas of an HOA and publicly-owned areas. Physically they may be the same, but there is a huge difference between the two that based entirely on who holds the underlying title to the property.
I guess I’m stumped as to what’s going on here.
Does the fact that there are no sidewalks or bicycle lanes disqualify it for historical status?
Were expenditures on sidewalks or bicycle lanes claimed on the organization’s Form 990?
Also what if there is no money in the HOA accounts? Do they go after the officers? By the way there are no bicycle lanes in my neighborhood - there are some sidewalks but they are maintained by the city, not the HOA. Does that make the HOA taxable?
I did run for HOA office a couple of years ago and didn’t win. Maybe I was lucky.
That is a classic tautology of argument by definition. It is a legal distinction and not a functional distinction. That means it is internally consistent but not logically consistent.
Facebook and Google Maps can also be used by the private sector to verify information and identify possible fraud indicators. Facebook is particularly helpful on developing useful intel on pop,e that aren’t so nice either. The blade cuts both ways.
If a city owns and operates a zoo, it's a non-profit entity by definition. If you build a zoo and charge admission, you pay taxes on your profits.
I'm not sure why this is so problematic.
1. The HOA qualified as a 501(c)(4) non-profit organization on the grounds that the common areas included streets, sidewalks and/or bike lanes that were open to the public, and therefore the HOA provided a "public benefit" to people regardless of whether or not they were owners or visitors to the owners.
2. The IRS looked into it and determined that the HOA did not qualify as a 501(c)(4) organization because it didn't adequately serve any "public benefit" at all. In making this decision, the IRS cited the fact that there are no bike lanes, the sidewalks are only open to the public during certain times of day, and the "streets" that are allegedly open to the public are blocked by a security gate.
3. As a result of the IRS determination, the IRS is instructing the HOA to go back and re-file their tax returns for a number of years, using the standard form for a corporation rather than the Form 990 for a tax-exempt organization.
If there is no money in the HOA accounts, the HOA will have to collect an additional assessment from the owners to pay whatever tax obligation there may be. The officers probably have no exposure here, since any HOA bylaws drafted by a competent professional would certainly include an indemnification provision that would protect the officers in a case like this. In theory the IRS could pursue a criminal case against the officers, but the information in the IRS letter indicates that this isn't the case.
If there's a substantial amount of taxes, interest and penalties here, the HOA might consider taking legal action against their management company, accountant, or legal counsel if the HOA board can make the case that they were given erroneous legal/accounting advice.
And that’s why only fools join these social networks and post personal info thereon.
It is a matter of market distortion that forces huge amounts of land into a very destructive control architecture. It places a large fraction of the housing stock in imminent risk. It impoverishes an entire industry. It enriches the wealthiest segment of the society at the expense of everyone else.
Other than that, no big deal
The list, Ping
Let me know if you would like to be on or off the ping list
Ping
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Google wanders around on public property and takes pictures. That seems legal.
If a government agency uses publicly available data to make a case, that's the way it is.
I DO wonder a bit about police cars cruising around capturing license plates, but while it seems evil, how is that illegal?
I’m not sure how that relates to the subject of this thread. This case involves an HOA in which I would presume all of the owners entered into contracts that governed the property.
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