Will the IRS begin auditing rape and incest victims?

The U.S. House of Representatives is scheduled to vote tomorrow, Wednesday May 4th, on legislation (H.R.3) which would require rape and incest victims to prove to the IRS that they were victimized. Under the bill proposed by Congressman McClintock (CA-R) the IRS would be forced to investigate how Americans have paid for their abortions.

To help ensure taxpayers comply with the law (assuming the proposed legislation becomes law) IRS agents would be expected to investigate whether certain aborted pregnancies were the result of rape or incest. Tax attorneys believe the legislation could result in new questions appearing on your tax forms. (e.g. Did you have an abortion this year? Do you have a receipt for the abortion? Was your aborted pregnancy the result of rape or incest?) These same tax lawyers also believe victims of rape or incest are likely be targeted for IRS audits if the legislation becomes law.

According to many tax attorneys and other legal scholars, the proposed legislation extends the reach of the Hyde Amendment (which bans federal funding for abortion except in cases of rape, incest, or when the mother’s life is at risk). The legislation would amend several provisions of the U.S. Tax Code, and in some cases, would forbid taxpayers from using any tax credits or deductions to help pay for abortions or health insurance that cover abortions. The bill would also reportedly impose tax penalties on businesses and/or individuals that buy abortion coverage for themselves or employees.

If the law passes, tax lawyers warn it could raise many questions and cause much confusion amongst taxpayers and the IRS. For example, suppose a rape victim uses funds from her Health Savings Accounts for doctor visits related to the abortion? Or suppose an incest victim is being audited, does the IRS have the right to demand court documents, or other records (e.g. counseling records) to prove the aborted pregnancy was the product of incest? Significantly, the proposed legislation puts the burden on the taxpayer to prove she was a qualifying victim.

If you are a rape or incest victim and have questions about how this legislation may affect you please consult a competent tax attorney or other tax professional to get the answers you need. If you are a small business owner and don’t have the internal resources to understand how this legislation may affect your business a tax lawyer or other tax professional may be able to help.

 

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