Jeesoo Nam (USC) presents Justice in Tax Enforcement at Duke today, as part of its Tax Policy Seminar hosted by Larry Zelenak:

The IRS has limited resources with which to pursue enforcement actions against people who have underpaid on their taxes. Given such limitations, the agency can only pursue a small subset of underpayers. How should the agency decide who to pursue?

This Article argues that the answer to this question depends on a fundamental issue of justice. Is the decrease in well-being that underpayers experience when tax laws are enforced against them good or bad from the standpoint of justice? When taxpayers underpay, they are illegally keeping money that they should have paid to the government to instead spend on themselves. When the government enforces the law, it deprives such underpayers of the use of their illegally gotten gains. Surprisingly, theories split on whether this deprivation is intrinsically good or bad. On a desert-based theory of justice, when people underpay on their taxes, they take for themselves more than they deserve. Thus, depriving underpayers of illegally appropriated cash is good from the standpoint of justice. It brings those underpayers back to the level of well-being they deserve. On a welfarist theory of justice, such deprivation is bad because all deprivation is bad, even deprivation of illegally gotten gains. This Article teases out the implications of these competing perspectives for the question of how the IRS should choose who it targets in its enforcement actions.