WASHINGTON — Look out, warn the Republicans. The Internal Revenue Service is about to unleash an army of agents eager to audit you and cost you a lot of money and aggravation.
But there is no such army about to mobilize. And it’s unlikely to cost most people extra money.
Here’s what to expect:
There will be greater IRS enforcement of tax laws, and more personnel, but the buildup will take years and it’s not clear how many employees will be involved.
The new Democratic-authored tax law “does not contain any detailed instructions as to how the money would be used by enforcement, taxpayer services, etc. It certainly does not say how many employees should be hired, or what those employees would do,” said Janet Holtzblatt, senior fellow at the nonpartisan Tax Policy Center.
Conservatives say otherwise.
“They’re adding 87,000 new IRS agents — larger than the entire population of Flint, Michigan — to collect $200 billion of new taxes — mostly from middle class families and shopkeepers who don’t have the resources to contest expensive audits,” said Rep. Tom McClIntock, R-Calif.
Democrats want to spend “$80 billion of your money to hire an army of 87,000 new IRS agents,” charged House Republican Leader Kevin McCarthy.
The furor stems from the Inflation Reduction Act that President Joe Biden signed into law Aug. 16. It included $80 billion over the next 10 years to help the IRS, which has been struggling not only to enforce tax laws but provide efficient customer service.
IRS officials insist there’s nothing for law-abiding taxpayers to worry about. “These resources are absolutely not about increasing audit scrutiny on small business or middle-income Americans. The investment of these important resources is designed to support honest, compliant taxpayers,” IRS Commissioner Chuck Rettig said Thursday in an op-ed for Yahoo! Money.
Is McClintock correct about the IRS?
Here are some of the key questions Republicans are raising, and some answers:
Will IRS hire 87,000 new agents to enforce tax laws?
Not right away, and in the future, it’s not clear just how many new agents would be hired or used to help enforce laws. Treasury Secretary Janet Yellen has told the IRS to report in six months how it will use its funds.
As evidence supporting the 87,000 figure, McClintock’s office pointed to Treasury’s “American Family Plan Tax Compliance Agenda,” a 2021 blueprint for modernizing the IRS.
On page 16, it seeks $80 billion that would be used for “hiring new specialized enforcement staff, modernizing antiquated information technology, and investing in meaningful taxpayer service.” The report says that by 2031, that would mean 86,582 positions.
