Black taxpayers are more than three times as likely to be audited by the Internal Revenue Service than other filers, according to a historically detailed study on race and the U.S. tax system. The discrimination stems from the IRS algorithm used to determine who is audited and the agency’s reliance on automated systems in the face of severe budget cuts. As The New York Times’ Jim Tankersley explains, this system caused the IRS to shy away from more difficult audits, such as those of wealthy people with complex finances, and focus on easier audits of historically disadvantaged groups.

Black Americans are disproportionately concentrated in low-wage jobs. They are more likely than whites to claim the E.I.T.C. The authors wondered if that prevalence in claiming the credit might explain why Black taxpayers face more audits, because I.R.S. data show the agency audits people who claim the E.I.T.C. at higher rates than other taxpayers. But as the research progressed, the authors found the share of Black Americans claiming the E.I.T.C. only explained a small part of the audit differences. Instead, more than three-quarters of the disparity stems from how much more often Black taxpayers who claim the credit are audited, compared with E.I.T.C. claimants who are not Black.


An historic Medicaid waiver
Californians who are on the verge of being released from prison or jail will soon have access to an array of Medicaid-covered services that include substance use treatment, behavioral health services and obstetrics. The coverage comes through a first-of-its-kind waiver granted last month by the U.S. Department of Health and Human Services that is designed to ensure that incarcerated people have access to critical services before their release – and that the coverage continues as they regain their freedom. From the Centers for Medicare and Medicaid Services:  

For example, Medi-Cal will be able to cover substance-use treatment before a Medicaid beneficiary is released from jail, prison, or youth correctional facility. Additionally, the state will be able to help connect the person to community-based Medicaid providers 90 days prior to their release to ensure they can continue their treatment after they return to the community. … This is the first time Medicaid will pay for a limited set of health care services provided to justice-involved individuals before they are released—a key component of the President’s proposed public safety package, the Safer America Plan.


Tenure task force shelved
Despite seeing a budget increase during last year’s legislative session, higher education took a step backwards in academic freedom, the LSU Reveille wrote. That’s because legislators approved a resolution by Sen. Stewart Cathey to study changes to academic tenure. The resolution created a task force that included representatives from state schools who were eager to defend tenure, and the academic freedom it enables. But the Louisiana Illuminator’s Piper Hutchinson reports that Cathey has shelved his own task force, which never met, and plans to introduce his own legislation instead. 

Cathey said he is working with higher education leaders on legislation, but he declined to name them or provide specifics on the bill he will pursue. Ashley Arceneaux, a senior aide to LSU President William Tate, said Tate has not been asked for input on Cathey’s proposal. Jim Henderson, president of the University of Louisiana System, said he has offered to discuss the topic with Cathey but has not been called on for advice. … “We do not know what the aim of the proposed new legislation is and are deeply worried that it may do irreparable harm to higher education in Louisiana. We would love to talk to the legislature and address any issues that it may have regarding tenure,” [Christof] Stumpf added. 

Louisiana would not be alone in challenging academic freedom on campus, as Florida and other states are taking aggressive steps to regulate what can be taught. The Washington Post’s Jack Stripling gives us an idea of what these new laws could look like. 

[Florida Gov. Ron] DeSantis recently signed a law that would require tenured faculty to undergo a review every five years. But there may be a need to “more aggressively” examine faculty performance, DeSantis said, touting a plan for college governing boards to review tenured faculty members “at any time.”


Capping credit card late fees
The White House proposed a new rule on Wednesday that would cap credit card late fees at $8. The move comes as Americans are taking on more credit card debt and interest rates reach record highs. The rule tightens a 2009 law that ostensibly required companies to charge “reasonable and proportional” fees to cover the cost of handling late payments, but in reality led companies to charge five times as much to perform the services. NBC’s Brian Cheung reports: 

“We worry that credit card companies are actually hoping that consumers are a day or two late so that they can cash in on fees,” Biden-appointed CFPB Director Rohit Chopra told reporters. … “Companies would be able to charge above the immunity provision so long as they could prove the higher fee is necessary to cover their incurred collection costs,” a CFPB document clarified. Capping the fee at $8 would reduce late fees by as much as $9 billion a year, according to the CFPB. 


Number of the Day
48,200 – Number of jobs that Louisiana added in 2022.  Louisiana has regained approximately 82% of the jobs it lost since Covid-19 shut down the economy in March 2020. (Source: Louisiana Workforce Commission via The Advocate