WASHINGTON (AP) — IRS pleas for more funding from Congress — made by one leader after another for years — Democrats this summer to release $80 billion in major climate funding and shoving into medical law finally paid off.
Bolstered by new funding, the IRS plans to clean up a massive backlog of tax returns, upgrade its decades-old technology, and hire more auditors.
But as Republican candidates across the country have made clear, the battle for IRS funding is only just beginning. They put a bigger attack on the IRS at the center of their midterm election pitch to voters, with Democratic bills funding an army of auditors to harass middle-class taxpayers rather than help them. I warn you that it will happen.
“If you go through it, they’ll come after you,” says an ad that runs at the Iowa House Race, which camouflages a scene from the movie Field of Dreams. Instead of the baseball player that came out, it’s an IRS agent in a black suit.
Republican warnings are generally disturbing and misleading. Government agencies aren’t hiring an army of 87,000 “new agents” to target middle-class Americans. used to replace Others will be customer service representatives answering taxpayer calls.
While some of the IRS employers are added to the ranks of sophisticated audit teams that spend thousands of hours scrutinizing complex earnings, the Biden administration will not allow small businesses and households earning $400,000 or less a year. I also made it clear that my income would not increase. Possibility of being audited.
“The purpose of the funding is to modernize the severely underfunded government agency and provide the customer service that Americans deserve,” said Natasha Sarin, tax policy and implementation counselor at the Treasury Department. increase.
But campaigning has a way of becoming policy. With Republican ads against the IRS dominating the airwaves of the campaign, IRS funding looks far from safe and could come under threat as soon as the next Congress is sworn in.
The waiting speaker, House Minority Leader Kevin McCarthy, has promised that if Republicans win a majority, passage of a bill to end the new IRS funding will be their first legislative act.
A bill like this is unlikely to pass, but even if Republicans gain control of Congress, President Joe Biden will retain his veto power, but it’s unlikely that Republicans will abandon the issue. is. Their greatest influence over IRS funding comes when Congress takes up the appropriations bills needed to fund government agencies or avoid government defaults.
Douglas Holz-Eakin, economist and president of the American Action Forum, a center-right think tank, doubts lawmakers will force government shutdowns in order to cut IRS funding .
“If it’s important enough to shut down the government, it will shut down,” Holz Eakin said. It said it had passed measures and largely skipped the IRS fight.
Still, some supporters of additional IRS funding are concerned about the Democratic response, or more precisely, the lack thereof, to the Republican advert. We focus our advertising campaigns on non-economic issues such as the right to
Frank Clemente, executive director of the liberal-leaning advocacy group Americans for Tax Fairness, said:
“This is a story about messaging,” said Clemente. “…candidates need to talk about it. They need to advertise on it. We need to tell people how they benefit from how they have to pay the taxes they owe.”
The IRS is still working out details on how the additional $80 billion will be spent, but has stressed that resources will be directed to improving customer service and scrutinizing at the income scale ceiling.
Among other things, the IRS said the new funding will be used to fix longstanding customer service problems such as answering phones. The problem is so prevalent that a bipartisan group of lawmakers last November complained that he wrote to the IRS and was only on the phone 9% of the time during the 2021 filing season. .
The IRS is also tasked with figuring out how to move forward with an enhanced free file system for taxpayers.
Nina Olson, former director of the Office of Taxpayer Advocacy, said taxpayers who wanted better customer service would be hit the hardest if funding was cut.
“If you don’t want the IRS to handle 85% of incoming calls, cut funding. If you want the IRS to continue using technology from the 1960s, definitely cut funding,” said Olson. said.
Democrats will support other health and climate priorities, such as helping millions pay health insurance premiums over the next three years and limiting insulin costs for Medicare recipients to $35 or less a month. Funded the IRS to help pay for the matter.
Of the additional $80 billion in IRS funding, the measure allocated $46 billion for tax law enforcement. The rest is used for other activities such as taxpayer services, operational support, and business system updates.
In 2013, when the IRS under the Obama administration was found to have used inadequate standards to screen the Tea Party Group and other organizations applying for tax-exempt status, additional funding to government agencies became political. It is highly controversial.
Despite a subsequent 2017 report finding that both conservative and liberal groups had been singled out for scrutiny, the IRS remained largely in the congressional fundraising battle in the years that followed. I was defeated.
In April, IRS Commissioner Charles Rettig told members of the Senate Finance Committee that, given inflation, the agency’s budget has shrunk by more than 15% over the past decade, with full-time employees dropping to 79,000 last fiscal year. said it was coming. Up to the 1974 level.
Vanessa Williamson, a senior fellow at the Urban Brookings Center for Tax Policy, said if the Republican Party succeeds in defunding the IRS, it would “severely undermine the basic functioning of government.” This is really annoying,” he said.
“The reality is that the government, through the IRS, plays a very important role in every day American life,” she said. “It is subversive to pretend that the roles that earn political points do not exist.”
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