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Bill Gates' Taxes Require Special Computer
NightWulf writes "News AU claims Bill Gates said in an interview, his fortune is so big, that the IRS needs a special computer, because a normal one can't handle the numbers. The IRS must have had to switch from PC's to Macs just for Gates."
Yes but large corporations don't have the sort of long-running mismanagement of IT that the IRS has. The story here isn't that Gates' fortune is so large but rather -- assuming the story isn't a hoax -- that the IRS is so mismanaged that it cannot deal with exceptional cases like Gates.
The IRS is apparently still using a computer system that became operational in 1967 (see this announcement for example).
Ah well this reminds me of the story that claimed that a Cray computer has been used to design the new Apple Mac (I don't remember which one).
When Seymour Cray was told this he supposedly replied with "That's funny, because I'm using an Apple computer to design(the Cray supercomputers)".
"There are very lareg corporations with financials much more complex than Gates' taxes."
Yes, but corporate taxes are probably held by a different division than personal taxes.
I worked for a year at the IRS in the early 90s and things are BAD. I wouldn't be surprised if he had to have his personal stuff moved over to the corporate computers.
Think about it this way, if you are running on older databases on older computers -- you have specific field sizes. Its hard to retroactively recode these without possible killing a large number of other items (I worked on modernizing some code at my department -- it was a pain in the ass). And beyond that, just because 0.00001% of the population needs a field size of a few hundred digits to calculate a value -- this will mean EVERYONE gets the same value size and require the same sorts of calculations slowing down the whole process and requiring a lot more memory (on computers that are no longer manufactured or were custom pieces -- because when I worked there, it was the battle of the lowest bidder and they ALWAYS made sure that just because they were lowest, it didn't mean they didn't make up for this fact a few years down the road with purposely propriatary parts they never told anyone about even though it was against the original spec sheet).
So I wouldn't be surprised to know a few dozen billionaires had their own computer system and were managed by a single individual (where as a single individual might manage a few million from a data perspective otherwise). And when you think about it, as much taxable income that man is bringing into the gov't -- it makes PERFECT sense that they'd put a $30k employee on to manage one guy that is chipping in a hundred million a year in taxes...
I could say more, but I won't because I still have security clearance with the IRS...at the same time, I'm going to post this anonymously even though I didn't give out any information that was secret (or even all that interesting).
This story is 100% plausible.
Bill didn't say that his tax records were the *only* one on that special computer. It is very likely that Mr. Buffet's records are on that computer too, as well as the records for any high net worth individual with complicated tax situations. I completely buy the story. I work in estate and gift tax planning and at least from that perspective, there are myriad of complicated structures (ie LLCs, FLPs, trusts, promissory notes) that require incredibly intense accounting. And I'm not even exposed to the more esoteric tax issues.
I did some work for a billionaire with only a *fraction* of Bill Gates' fortune once and I had to invent a whole new set of models for keeping track of the spider web of entities. The guy's accountants had it even worse, because they had to keep track of transactions in hundreds of entities by and among various family members...I just had to track the data for one individual. It was my understanding that if this particular family ever underwent a Section 754 Election, where the cost basis of the underlying assets is adjusted to market value (or something like that), the cost in legal, accounting and IT resources could run into the millions.
Bill Clinton: Pimp we can believe in. - The Shirt!!!