April 13, 2012
Cronyism at the IRS
By James Wilson

Quote of the Day: "My customers, not the IRS, should decide who prepares their taxes." - Elmer Kilian, in this video:

The IRS is making business more costly for 350,000 small, often part-time tax-preparation businesses. But large firms like H & R Block and Jackson Hewitt get a pass.'s "Write the Laws Act" was written to prohibit this kind of cronyism. It would prevent unelected bureaucrats from making up and imposing regulations. It would instead require that ALL such regulations be passed by Congress. After all, that's what the Constitution requires.

That's why I wrote this letter telling Congress to stop the IRS, and to introduce and pass the Write the Laws Act.

Please do the same. You may borrow from or copy this letter . . .

Unelected bureaucrats in "alphabet agencies" such as the FDA and EPA make up and enforce rules on their own. They impose many times more "regulations" than the number of laws passed by Congress each year.

This . . .

* ruptures the very concept of limited government
* busts the separation of powers
* violates Article I of the Constitution
* is fundamentally unfair, because powerful industry insiders have greater influence in the regulatory process than do small businesses.

Consider this blatant and recent IRS attempt to regulate small businesses . . .

Fewer than 500 tax preparers receive IRS sanctions per year. Far fewer are prosecuted. Yet the IRS is determined to make business more expensive for 350,000 small, independent tax preparers. They would have to pay additional fees and also pay for "continuing education."

But wait. Here's where it gets REAL interesting . . .

* CPAs and their employees
* Lawyers (any kind of lawyer, not just tax lawyers)
* And employees of large tax firms

. . . are exempt from the regulations!

Isn't it curious that . . .  (

* a deputy commissioner of the IRS, who had a hand in crafting the new rules, is a former CEO of H&R Block?
* big tax-prep companies — H&R Block, Jackson Hewitt, Liberty — all support the new regulations?

Do you REALLY think these IRS regulations protect the consumer? Isn't it clear that they're designed to ruin small business and protect the big and powerful from competition?

Isn't MOST regulation like this?

The Institute for Justice is fighting the IRS's crony regulations in the courts. But did this situation need to reach that stage?

* If Congress just followed the Constitution, it wouldn't have ever delegated legislative - or what you call "regulatory" - authority onto unelected bureaucrats.
* If the Write the Laws Act was in force, the IRS wouldn't have felt entitled to impose this regulation in the first place.

I insist that you . . .

* Pass a bill preventing the IRS from enforcing these unnecessary regulations on tax preparers.
* Introduce and pass the Write the Laws Act.


You can send your letter using's Educate the Powerful System.

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Have a great weekend!

James Wilson
Policy Research Director, Inc.

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