a) In the spirit of 'you can't get blood from a stone' -- I suppose the IRS - similar to other creditors - may believe it's better to get something rather than nothing when the financial circumstances of a tax payer may make it impossible for them to fully pay past due taxes they owe.
There could be any number of circumstances where this might occur.
I'm sure many instances are the fault of the taxpayer in some negligent or nefarious way. On the other hand, there could be some situations that might lie more in the vein of --> there but for the grace of God go I.
(Color me a bit skeptical about the claim of a $100,000 tax bill reduced to $100. If that's true - that's obviously some extreme, unusual situation.)
b) I've known two clients who've been tax scofflaws.
One was an alcoholic who simply didn't file a tax return for several years. His daughter ended up having to deal with all this with the IRS. I have no idea how that was settled. It was a real headache for the daughter.
In another case -- there was elderly widow whose deceased husband handled all their financial affairs. This woman had millions $$$; but went for months after her husband died without even opening her bills —> millions $$$ but Duke Power is ready to cut off the lights. I think she had depression after her husband passed.
She had a son (age 60+) who was supposed to help her. But he had mental problems.****** He was like a 65 year old child.
Between her and the son - they couldn't get their act together to deal with a CPA and get their taxes filed. After failing to file a return for a number years they hired a law firm to help clean up after the mess that had been created. But the lawyers are limited by the inability of the client to cooperate in providing the information needed to complete past tax returns.
Eventually, she got a home health service to help her handle her day-to-day affairs. Exactly where things have ended up with the IRS I couldn’t say. Her problem wasn’t paying the money. It was getting the records together after so many years to file a proper tax return and know what was owed.
****** This man was involved in a legal dispute over a rent controlled apartment in New York City. I learned at some point he was wearing an aluminum foil skull cap underneath a toboggan on his head and he had aluminum foil covering all the windows in his bedroom -- because the other people in lawsuit were sending down radio signals to screw with this brain.
Given that -- it shouldn't be surprising that filling out even a 1040EZ was somewhat beyond his capacity.
c) So whether we should hold delinquent taxpayers in contempt or pity I suppose depends on how they've ended up that way.
