IRS Reveals Plan to Spend $80 Billion Funding Boost
The Internal Revenue Service (IRS) has unveiled its spending plan for an $80 billion cash infusion, promising to hire new workers to audit wealthy Americans and big corporations, modernize technology, enhance enforcement of the wealthy, improve customer service, and deliver real-time alerts to reduce the tax gap over the next decade.
The IRS has not given an estimate for agency hiring plans beyond the next few years, but plans to hire nearly 30,000 new employees by the end of fiscal year 2025, including 8,782 hires in enforcement and 13,883 in taxpayer services. The new enforcement employees will focus exclusively on high-earning households, larger partnerships, and companies.
Republicans and other critics have criticized the funding boost for the potential to hurt lower-income Americans, as the IRS targets low-income Americans, auditing them five times more often than everyone else. However, the IRS plan states that it will comply with Treasury Secretary Janet Yellen’s order not to increase audit rates for Americans earning less than $400,000 a year.
The influx of money will improve tax compliance among big corporations and wealthy Americans and reduce the estimated $600 billion tax gap. Revenue generated by the IRS will go toward initiatives to combat climate change, reduce pharmaceutical prices, and address the nation’s $30 trillion debt.
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