How to Cheat on Your Taxes
No Authority to Audit
Curnutt has been unable to get the IRS to follow up on the insights for which it honored him, for reasons neither spokespeople nor IRS commissioners have explained, despite my repeated queries. So Curnutt began offering his services to every state with an income tax. The response has been underwhelming.
Years ago, a Kentucky tax official told me Curnutt was rebuffed because his audits would have exposed some of the then-governor's major campaign donors. New York state officials under four governors have repeatedly claimed, in writing and interviews, that they already do "Curnutt audits," but that is not true.
California's Franchise Tax Board told
Curnutt in 2009 that it could not afford to hire him. His fee? Travel expenses, plus $140 an hour. That is a fraction of the hourly rate states routinely pay lawyers, accountants and other experts for advice that does not raise a penny of revenue. And Curnutt could put many millions into state coffers for minimal expense and effort.
Only one state hired Curnutt: Pennsylvania. From 2002 to 2009, he put in seven months of work there and found hundreds of real estate partnerships that had failed to report more than $1.6 billion in income. That works out to close to $50 million in unpaid state taxes, and $400 million in federal taxes. Curnutt's fee came to less than $200,000.