Oh, $700 Billion Was Not Enough…

So, much to my chagrin the House of Representatives voted to pass the bailout bill yesterday, after it was made into a mashup of the proposed bailout, the Energy Improvement and Extension Act of 2008, and the Tax Extenders and Alternative Minimum Tax Relief Act of 2008. In addition to the EIEA to woo Democrats, and the TEAMTRA to woo Republicans, many specifically targeted pork projects were added to entice lawmakers to vote for it. The sections and their “enticements” are listed below:

Sec. 101. Extension of alternative minimum tax relief for nonrefundable personal credits.

Sec. 102. Extension of increased alternative minimum tax exemption amount.

Sec. 103. Increase of AMT refundable credit amount for individuals with longterm unused
credits for prior year minimum tax liability, etc.

Sec. 201. Deduction for State and local sales taxes.

Sec. 202. Deduction of qualified tuition and related expenses.

Sec. 203. Deduction for certain expenses of elementary and secondary school teachers.

Sec. 204. Additional standard deduction for real property taxes for nonitemizers.

Sec. 205. Tax-free distributions from individual retirement plans for charitable purposes.

Sec. 206. Treatment of certain dividends of regulated investment companies.

Sec. 207. Stock in RIC for purposes of determining estates of nonresidents not citizens.

Sec. 208. Qualified investment entities.

Sec. 301. Extension and modification of research credit.

Sec. 302. New markets tax credit.

Sec. 303. Subpart F exception for active financing income.

Sec. 304. Extension of look-thru rule for related controlled foreign corporations.

Sec. 305. Extension of 15-year straight-line cost recovery for qualified leasehold improvements and qualified restaurant improvements; 15-year straight-line cost recovery for certain improvements to retail space.

Sec. 306. Modification of tax treatment of certain payments to controlling exempt organizations.

Sec. 307. Basis adjustment to stock of S corporations making charitable contributions of property.

Sec. 308. Increase in limit on cover over of rum excise tax to Puerto Rico and the Virgin Islands.

Sec. 309. Extension of economic development credit for American Samoa.

Sec. 310. Extension of mine rescue team training credit.

Sec. 311. Extension of election to expense advanced mine safety equipment.

Sec. 312. Deduction allowable with respect to income attributable to domestic production activities in Puerto Rico.

Sec. 313. Qualified zone academy bonds.

Sec. 314. Indian employment credit.

Sec. 315. Accelerated depreciation for business property on Indian reservations.

Sec. 316. Railroad track maintenance.

Sec. 317. Seven-year cost recovery period for motorsports racing track facility.

Sec. 318. Expensing of environmental remediation costs.

Sec. 319. Extension of work opportunity tax credit for Hurricane Katrina employees.

Sec. 320. Extension of increased rehabilitation credit for structures in the Gulf Opportunity Zone.

Sec. 321. Enhanced deduction for qualified computer contributions.

Sec. 322. Tax incentives for investment in the District of Columbia.

Sec. 323. Enhanced charitable deductions for contributions of food inventory.

Sec. 324. Extension of enhanced charitable deduction for contributions of book inventory.

Sec. 325. Extension and modification of duty suspension on wool products; wool research fund; wool duty refunds.

Sec. 401. Permanent authority for undercover operations.

Sec. 402. Permanent authority for disclosure of information relating to terrorist activities.

Sec. 501. $8,500 income threshold used to calculate refundable portion of child tax credit.

Sec. 502. Provisions related to film and television productions.

Sec. 503. Exemption from excise tax for certain wooden arrows designed for use by children.

Sec. 504. Income averaging for amounts received in connection with the Exxon Valdez litigation.

Sec. 505. Certain farming business machinery and equipment treated as 5-year property.

Sec. 506. Modification of penalty on understatement of taxpayer’s liability by tax return preparer.

Sec. 512. Mental health parity.

Sec. 601. Secure rural schools and community self-determination program.

Sec. 602. Transfer to abandoned mine reclamation fund.

Sec. 702. Temporary tax relief for areas damaged by 2008 Midwestern severe storms, tornados, and flooding.

Sec. 703. Reporting requirements relating to disaster relief contributions.

Sec. 704. Temporary tax-exempt bond financing and low-income housing tax relief for areas damaged by Hurricane Ike.

Sec. 706. Losses attributable to federally declared disasters.

Sec. 707. Expensing of Qualified Disaster Expenses.

Sec. 708. Net operating losses attributable to federally declared disasters.

Sec. 709. Waiver of certain mortgage revenue bond requirements following federally declared disasters. Sec. 710. Special depreciation allowance for qualified disaster property.

Sec. 711. Increased expensing for qualified disaster assistance property.

Sec. 712. Coordination with Heartland disaster relief.

Sec. 801. Nonqualified deferred compensation from certain tax indifferent parties.

Wow! That was all that was needed to make a horrible bill attractive enough for passage. Clearly, we, the taxpayers who will be footing the bill for this debacle, were not persuasive enough to convince our legislators that this was a bad idea.

If all that pork was not enough to enrage you, CNET News is reporting that the bill grants permanent privacy invasion by the IRS to conduct undercover operations where they run businesses to ensnare individuals by posing as accountants to ask questions like “I am not 100% sure this deduction is legal, but it will save you a couple grand. Do you want to take it anyway?” Not only does this give the IRS the ability for entrapment, it also allows the IRS to give information from individual tax returns to whatever federal law enforcement agency requests it as part of their investigation of suspected terrorist activity. This information can then be shared with local and state authorities at the discretion of the federal agency. They can share “a taxpayer’s identity, the nature, source, or amount of his income, payments, receipts, deductions, exemptions, credits, assets, liabilities, net worth, tax liability, tax withheld, deficiencies, overassessments, or tax payments, whether the taxpayer’s return was, is being, or will be examined or subject to other investigation or processing, or any other data received by, recorded by, prepared by, furnished to, or collected by the Secretary with respect to a return.”

Not only is the government spending nearly a trillion dollars that will be printed with no backing, but the IRS now has permanent authority to entrap citizens into tax fraud, as well as the ability to share my personal information with any agency that suspects that I may be involved with terrorism. Luckily, they control what constitutes terrorism these days. That certainly makes this whole situation more appealing to me.

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