that is all the time that we have tonight. "the willis report" is coming right now. gerri: hello, everyone, i am gerri willis. tonight on "the willis report", the irs says it is above the law. not needing a warning to invade your privacy. is it legal, and what are they looking for? also, how do you avoid an irs audit. many red flags to look out for. and here comes the invasion. billions of cicadas about to sweep across the country. we are on the case on "willis report."

our top story tonight is a taxman may be reading her e-mails. the internal revenue service claims it doesn't need a warrant to read your e-mails. we will get to that in just a moment. it prefers, is it legal for the irs read my e-mails between now and 10 anytime? >> that is the problem here. documents say that the irs has written policies telling thousands of agencies.

it made it painfully clear that because of a number of legal reasoning from the government cannot go in and invade private e-mails. that there has to be a legal process. gerri: fox business got a statement. here's what the irs says, respecting taxpayer rights and privacy are cornerstone principles for the irs. any suggestions to the contrary

is wrong. we make about? >> well, i think that those words are just going around the whole issue. they might has well have been reading at home or something. there is a laundry list of critical federal laws that make it clear that this isn't legal action the government says don't worry about it. it is absurd. gerri: exactly. an old law, so old in fact, that it allows the irs access and the government access to e-mails that are under 180 days old. go figure how they came up with that. wanting you to respond to the irs handbook where they outlined their ability to do this. it's said the fourth amendment

does not protect communications held in electronic storage such as e-mail messages stored on a server. internet users do not have a reasonable expectation of privacy in such conditions. i mean, i have a reasonable expectation of privacy. how about you? maxwell, of course. that position is legally absurd. you have the fourth amendment restriction of searches and seizures. the 10th circuit ruling. there are other statutes as well. federal law says that not only do you have an expectation of e-mail, if somebody violates it, they can go to jail for felony. gerri: let me make a comparison. if i go to your mailbox and i take your mail out, i go to jail. why isn't the same true with my e-mail box?

>> i completely agree. now you have a situation where there is no judicial intermediary because they are saying that they don't want to have a one and they are going to step over the constitution and just move forward applying a 30-year-old law completely out of context. it is an unconstitutional approach. gerri: will be challenged in a court of law? >> perhaps. the senator who is the author of the original bill has voiced concern here on capitol hill in washington. they are looking at an amendment to clarify this issue and i think that would also provide some guidance. the one i like big brother to go away. thank you for coming on. so is the irs weighing in?

here is a member of the tax writing ways ways and means committee. and kim carney from honey from the senior political columnist for the washington examiner. i must get your reaction to the story today by the irs, reading the e-mails, electronic indications, congressman, to you first. >> okay, that sounds outrageous as to what the irs is claiming that they have the authority to do. taxpayers have a reasonable expectation that their privacy will be protected. now we have an agency that has clearly shown it is wasting taxpayer dollars. and now we can overreach and they can violate the fourth

amendment. we are going to look at this and in fact, today, i fired off a letter to the irs acting for accountability is what is going on. >> will you investigate? this is the irs. at the end of the day, they carry a very big stick. >> well, congress carries a big stick as well. we are going to ask those questions. i will be in contact and expect a proper response. >> we will have a hearing coming up in the upcoming weeks. if i haven't had answers directly, i can assure you that i will be asking these questions during the context of the hearing. >> you are always watching government overreach and you are always following it as closely as you can. are you outraged as well? >> yes, because we have had a federal court ruling, saying

that no, you can't just go and subpoena an e-mail. the irs could go and if they had a probable cause to go to your e-mail. now they can go in and they can read your e-mail. every aspect of your life is relevant to this. what about the dinner you deducted? going throw your e-mails with your buddy, so it's another reason to worry about. gerri: frankly, that is very concerning. >> what they have to use for a subpoena is a far lower

threshold. they can subpoena you without a judge and go out there and they could subpoena and say to turn over these e-mails to us from gerri willis. gerri: that is what i am worried about. the coverage on this, people have been stepping very carefully because you don't want to make the irs now. it is concerning, but yet the overreach is stunning. the rs will be charged at the irs is paying for it. because if you're not coming or going to have to paychecks. >> all this has been placed under the shoulders of the affordable care act. obamacare. the irs is not ready to do this. i don't think the irs ought to

be looking at people's health care and benefits and determining what kind of benefits are subject to penalties. this is a serious problem. it is certainly a problem inherent in the health care law and we have been holding hearings on this and we will have plenty more on it because clearly this bill,. >> i'm wondering what you are thinking. empowering the irs really peer over your shoulder every little

expansion of government leads to his future intrusion on liberty and privacy of. gerri: it is not uncle sam's business what i eat or how i live my life. >> thank you for coming on tonight. what a great conversation. you must come back so we can discuss it again. cumbersome, thank you so much. >> now we want to know what you think. log on to gerri willis.com and vote on the right-hand side of the screen. andy coming up next, the pending circuit invasion. ♪

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we asked total strangers to watch it for us. thank you so much. i appreciate it. i'll be right back.

they didn't take a dime. how much in fees does your bank take to watch your money? if your bank takes more money than a stranger, you need an ally. ally bank. your money needs an ally. gerri: it is a bug alert for you now. the east coast is going to get slammed by billions of cicada bugs. these bugs that you are seeing here, they are creepy and crawly critters. haven't seen the light of day for 17 years and they are set to converge on a country in a

matter of weeks. for more what this means to you and your property, we have the senior scientific assistant for the american museum of natural history. which is a very cool place. >> there about three species total of different kinds of cicadas. but they look very much alike. gerri: so they live underground and my question for you is what

are were they doing? >> they are feeding. gerri: they are in my lawn underneath the ground? >> beating on the glitz of the trees. gerri: there is a 1962 event where people were scared. you expect us to beat a dead kids on playgrounds are scared and that we see swarms of them? >> it will probably be through new jersey and pennsylvania and in connecticut, maybe rhode island. they produce a sound, the mail

produces a sound. and they attract a female and they say on trees and that is why it is quite loud. gerri: it is a love call? >> yes. gerri: hopefully they meet and then go away. >> they only live about four to six weeks, the nymphs hatch and go into the ground to start this whole sequence over again. gerri: so you think this is a good thing? what is good about it? >> well, it is a food source for a lot of animals. the dead cicadas are good for fertilizer for plants, actually. gerri: all over my yard and driveway. all over the sidewalk. if you are on the golf course, it is like crunch, crunch, crunch. >> it could potentially be. gerri: anything else you want to

say about the data? >> they are actually edible. if you get them when they are coming out of the ground -- they taste like one, you can cook them in different ways. i collect the annual cicadas that are out every year. although they have been in the ground for about two years. gerri: okay, so we have cicada gumbo, pineapple cicada, coconut cicada, do you recommend any of those? >> those are deep dishes. you can actually sputum or sauée them. >> people make ice cream as well. they make lobster ice cream as well as. gerri: that i can deal with. now you have ruined lobster for me forever. thank you for coming on. you are a great guest. thank you, sir.

>> thank you for having me. gerri: the 77th masters tournament is underway in odessa, florida. sergio garcia, of spain, just tied for first place. he is not well known, but he is reclaiming his number one spot. woods shattered two under 70, leaving him four shots behind. but he still has three rounds to go. leishman did his best. coming up tomorrow on "the willis report", pga tour radio host is going to be with us to talk about this. you won't want to miss it. and still ahead, the latest

trend in the jobs trends. and why health care costs are going to take a bigger bite out of your wallet and why some employers are dropping coverage altogether. are you still sleeping? just wanted to check and make sure that we were on schedule.

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gerri: lots of information coming out about the cost of that obamacare. we will have that next

gerri: obamacare kicking into high gear next year and nobody -- and i mean nobody seems to know how much it will cost. two prominent democrats admitting that the law is

complex and complicated and confusing. and that included the health and human services secretary kathleen sibelius. one of the reasons the estimated costs are spread out across hundreds of pages in obama's newly released budget is requesting an additional $1.5 million just to implement the change -- exchanges, that is. with more with the confusion had, michael cannon, the director of health policy studies at the cato institute. thank you for coming on. why can't we get a straight answer about the cost of this? wire the costs rising? >> blasting the obama administration wants is for anyone to know the cost of this law. the cost is spread out among federal agencies. we pick out individual parts, we find the projections, like you said. like you said, kathleen sibelius has been spending lots of money

to encourage them to implement the law. earlier this year, they said they would be spending $2 billion by the end of the year. but now we learn it will be more than twice that amount to an you say the devil is in the details. look at the insurance exchanges. we were told 4.4 billion and now we are told it will be more than that. but can we trust her for numbers >> that is the cost of driving the states. states don't want to do it. only one third of the state say that they want to run these exchanges because this is going to be a disaster. and they don't want to take responsibility for it. the federal government has to run exchanges in 33 states. they will not be able to get up and running. supporters of this law are heading for the exit. you have jay rockefeller, a

senate democrat saying that it is so complex. gerri: getting to the big kahuna of costs, focused on how much money is coming out of taxpayer pockets. how much will it really cost to extend health care coverage to 27 million people? we have been told everything. we know that the low income folks will get medicaid, low income folks will get subsidized. but there is no reporting in the budget that tells you. $3 billion here, $32 billion there. there is no real accounting of what we will have to pay for this. >> the congressional budget office has been tracking that and what they found is that current states are refusing to implement parts of the law is the medicaid expansion. at the but the cost is actually going to be less. the cbo has said that back in july -- they said that the cost will be $84 billion less than they had originally projected.

states are refusing to implement the medicaid expansion. gerri: medicated an additional $30 billion to cover people who are not covered now. then a tax credit that would go to middle income folks is estimated to be worth $32 billion. i just don't seem to find much honesty in talking about the real cost. that is what is so frustrating. it's one thing to suggest a program to help americans that you are eager to put into place. it's another thing to tell the american people what they are going to have to pay to get that kind of service. what do you think of that double standard? >> the worst part is not just 30 something billion dollars that the subsidies will cost him the first year. we look over the first limitations, they say it's $1.2 trillion of impact on the budget. but the obama administration

offered authorization from congress to spend the money in those own exchanges. they are really trying to spend $600 billion that congress never authorized. that is the most important story here. they're being sued by the state of oklahoma and probably by other people because illegal subsidies will trigger legal taxes. gerri: some people maintain that obamacare is sort of falling apart. but it will be irrelevant and it's not really going to come to fruition mainly because of the states refusing. and also because it's just not working.

>> it looks like we have a train wreck coming by the end of this year before these provisions take effect. it is entirely possible thing that congress will delay and even president obama will want to delay the implementation of many provisions of the law. may have you met on their hands thank you for coming on, it is great to talk. gerri: unbelievable. , stories in the news. coming up, we continue the business of taxes and we will talk about a scary trend of thieves getting hold of your tax returned before you do. avoiding those automatic red flags. what to do if you get audited coming up next. we know a place where tossing and turning have

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>> still haven't filed your taxes, we got you. we have rich coppa, the managing director for wealth health financial planning. let's start with some of these red flags of the irs. >> some things you have to watch out for it is one of the things that's very easy to find. the w-2 is reported to the irs come about is one of the large big flags. another thing is taking excessive itemize deductions,

particularly charitable deduction, mortgage interest deduction. which i have seen letters from the irs on the. >> the government is getting really tight about desperately want to reduce as much as possible. what you say about that? are people going out to be to be particularly careful this year with their terrible donations? >> the irs tracks with the deductions are based on the amount of income that you have. they have a reasonable number of what people do for a personal expense and charitable deductions and things like that. you are at the very least going to open yourself to an audit. gerri: they are looking at how much you should be giving in terms of charity. you say aggressive business deductions. how much is a progressive? >> the small businesses -- you

have to have the necessary expenses. there have than people taking excessive travel expenses, finding its way to the business ring. meals and entertainment. it is a truly related to the business. gym memberships. country club memberships, funny things in a more personal in nature. gerri: so you can't include the country club memberships? [laughter] >> no. >> dominick, i want to give you a couple of specific examples of things. if you have a small business, particularly one that tends to operate on cash. a small bar or restaurant or hair salon. more likely to look at you than they are ibm, is that right? >> every single business uses a business code to tell the irs what kind of business you do. the irs tracks this. if you own a hair salon and

you're taking a trip to hawaii for a seminar, you open yourself up for someone saying, is that normal, is that customary, is that appropriate. you must look at the expenses for your business. they have to be appropriate. gerri: you have to ask a tax professional or is there a way to know? >> states come in and target industries and they know what kind of cost is associated with that industry. if you will are showing this in the pizza via business, you are showing $100,000 in income. >> they have actually done it, gerri. gerri: i wonder if the models are right.

are they really that accurate? >> it doesn't matter if they are accurate, what matters is giving them enough to investigate. gerri: they have your e-mail as well. which is crazy. dominic, this is like one of those, you know, red flag in front of a bull, you have your home office. the utility bill, heating and air conditioning, what else? >> daycare. >> this is really a legitimate age where you are working in companies actually want to work out of your house. it is a legitimate deduction. but the problem is when people decide they need to be piggish about it. if you are using more than one room for an office, you should take only 10% of the electric bill and etc.

it's when people go out of bounds and try to take advantage of the situation. >> one quick thing to 2013. there's a new rule out so that people don't want to go through the major calculations, there is a format that allows you a maximum 1500 credit for 2013. not 2012. gerri: i'm a little disappointed in not. i thought it would be a little more. >> then you have to do the longform and support the deductions. gerri: my husband and i have had to do that. >> welcome to my world. >> thank you guys for coming on. you guys are great. a lot of people got the information they needed. i thank you. now that we have your 20s will taxes figured out, it's time to think about your 2013 returns if you haven't started already. we are already a third of the

way through 2013 and there are many changes thanks to the american taxpayer relief act. be prepared for those changes, including a higher income tax rate. money-saving moves you can make. some advice was given earlier on fox business. >> they have made sense in the past. but now the taxes have fully come into play. you must look at the implications of the portfolio because he could have such a loss on the return of the investment based on the tax implications. the loss that you could take, the overall income tax rates. it is a much more complicated and the structure to maximize your return. gerri: he also pointed out that state taxes are a hidden burden when it comes to tax season. some say that the course is worse than others. brace yourselves, my friends. number five is rhode island.

this state ties with highest unemployment rate. number four, vermont. not a small state, but a big tax bill. gas taxes on the rise. and number four is california. the golden state has the highest unemployment rate in the country and the highest sales tax. it brings in the top five of corporate tax rates. despite that, 12 of the 1400 companies are in california. and the garden state ranks number two. and property taxes, number three in sales taxes. new york has the highest income tax, and like california,

businesses are getting the picture. seventeen of the fortune 100 companies are in the empire state. i'm thinking about moving because i live right here. maybe i can move west. when we come back, should you be looking for a job on twitter. and our special, the business of taxes continues. these are targeting your tax refund and taking your hard earned at dough. up next with the details. my mantra?

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>> somebody else cashing in and your tax return? identity theft is certain.

peter burns is in washington with this story gerri: did we lose peter? well, maybe we will get him back. oh, there he is. welcome back. >> people need to know about this. i was stunned when i learned about this problem. a report by the treasury inspector general estimated that the refund robbers may have stolen as much as $5 billion in 2011. >> it is much easier than risking yourself out there,

trying to do a drug deal or knock over a bang. he said at a that a computer in the living room and grab some social security numbers and some w-2s that you have talked about. it is like a dollar in the dream in lottery, this is a social security number and a dream. >> the irs says that with detection software, it has stopped $20 billion in fraudulent returns. but to prevent this from happening, the administration is proposing to replace social security numbers on your w-2 form with a special new employee id number. it also wants to limit access to a public social security database of people who died so that their personal information doesn't get stolen afterwards. and somebody tries to get a refund from a dead person. gerri: peter, i must tell you that this is -- this is the lazy

criminals way of making money. what do folks do? >> you have to protect yourself and your own personal information better. you can do that in a variety of ways. you can register for alerts and things like that. but do not respond to e-mails that appear to be from the irs. because the agency doesn't communicate with taxpayers by e-mail. don't ever respond or click on an e-mail like that. don't give your social security and number to some cool cause it. beyond that is good stuff, you're totally right. if someone sends you an e-mail saying they are the irs, they are a crock. i thank you. gerri: still to come, will cost more, a caribbean cruise or a stay at a motel motel six? and getting your resume to fit on one page.

look at the new resume coming up. thank you orville and wilbur... ...amelia... neil and buzz: for teaching us that you can't create the future... by clinging to the past. and with that: you're history. instead of looking behind...

delta is looking beyond. 80 thousand of us investing billions... in everything from the best experiences below... to the finest comforts above. we're not simply saluting history... we're making it. gerri: the new resume must be 140 characters or less. details on how twitter is the new job board.

gerri: all right, forget the old-fashioned traditional resume. the new resume is 140 characters or less. in some cases, a 62nd video clip. rachel silverman joins me now. rachel, thank you.

it's great to have you here. i can't believe people are using twitter for their résumes. how'd he do that? >> well, a lot of people are not putting those onto a tweet or that what they are doing is working on a twitter resume, and then provide a link. whether that be a linking page or a website. >> uses would be appropriate in the tech industry, marketing. this is really for certain kinds of jobs? >> right now it is used for certain kinds of jobs. marketing jobs, communications jobs.

the people really need to have good customer experience working with the public and the customers as well. gerri: it seems that twitter is the wild west. people say all kinds of things there. so how do you do something as serious as finding a job as twitter? >> don't lament your tweet to purely professional tweaks. a lot of recruits like it when you post personal information. gerri: but you have to be careful. >> yes, you do. but a lot of the recruits really want to know about you. a resume is a one-page piece of paper. hooters want to know what

someone will be like to work with. don't be shy about tweeting what you have for breakfast. but don't don't be a noxious. keep it clean. >> i cannot say good morning and 140 characters. i have no idea how i would do an entire resume that way. thank you for coming on, rachel. >> thank you. gerri: we will be right back. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age. ♪ the question is how do you make sure you have the money you need to enjoy all of these years. ♪

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real estate in hong kong, and the optics industry in germany? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. gerri: if you only knew what happened. it's unbelievable. back to the irs. they say, they do not need warrants to access your e-mail. the you think they're spying and you? we * of gerriwillis.com. sydney sat -- 79 percent said yes to maturity and not one person said no. finally tonight, when your reputation is damaged you are forced to get desperate, and that is what is happening with carnival cruise lines. after a string of incidents you have heard about these to my including

the triumph being stranded for days with more than 3,000 passengers on board the their slashing prices. a 4-night trip will set you back $150 or so which includes meals. pretty good. however, that is before travel fees and taxes and to include all of that it is $230, but it is still cheap compared to others. compare the $149 price tag for four nights coming upset $37 per night. you could not get that low staying in a motel six. illustrate there is $40 per night. no, i'm not pushing it to take your family and a cruise. employee and if you wonder wrist the stomach flu, power outages, and backed up toilets you could do it cheaply. that's my "2 cents more". i can't believe i said that. to meet tomorrow. in fashion distances big business of nail care if. here to tell me how they're tapping into the billion dollar indust