Biden budget would beef up IRS tax enforcement
Sunday, April 11, 2021
The White House last week kicked off the fiscal year 2022 budget process by sending a letter to the House Appropriations Committee chairman and issuing a press release on President Joe Biden's funding priorities.
The official 2022 discretionary budget request announcement lists 11 areas that also got attention during the presidential campaign, such as education, medical research, housing, and civil rights.
In addition to the information issued by 1600 Pennsylvania Avenue, Treasury Secretary Janet Yellen also elaborated a bit on the areas under her department.
Overall + enforcement $ bumps for IRS: Yellen said the Biden Administration's formal FY22 budget also will seek money to help support a fair and equitable tax system. That's political speak for beefing up the Internal Revenue Service so that it can do its job better, including auditing all who aren't paying what they should.
To do that, Biden's first budget for the coming fiscal year, which begins Oct. 1, will include $13.2 billion overall for the IRS, said Yellen. That's $1.2 billion, or 10.4 percent, more than the level of funding provided the tax agency for the 2021 fiscal year.
"In addition to increases for base IRS enforcement funding, the 2022 discretionary request provides an additional increase of $417 million in funding for tax enforcement as part of a multiyear tax initiative that will increase tax compliance and increase revenues," noted Yellen.
"With this funding, the IRS will increase oversight of high-income and corporate tax returns to ensure compliance," she added.
Altogether, the 2022 discretionary request will increase IRS resources for tax enforcement by $900 million.
The Biden Administration's proposed new money for IRS enforcement actions is welcome. But for this weekend's By the Numbers honors, I'm going with the overall IRS budget request of $13.2 billion, since the agency has been historically undercut financially by Congress.
We'll see if the slim majorities in the House and Senate can push the Biden request through.
If that happens, then we'll see how quickly the IRS can ramp up its lagging enforcement, aka audit, efforts.
More money for taxpayer service, too: The new money should help enforcement, but Yellen also underscored the agency's other job of customer, i.e., taxpayer, service.
Yellen said other requested FY22 funds should help the IRS provide new and improved online tools for taxpayers to communicate with the IRS easily and quickly, and improve telephone and in-person taxpayer customer service, including outreach and assistance to underserved communities.
Here's hoping the IRS does indeed get more money in the coming fiscal year and that it puts it to good use toward all its responsibilities.
You also might find these items of interest:
- IRS says it did a pretty good job in a COVID-affected year
- Trump's FY21 budget calls for extended tax cuts and more IRS money
- 7 former IRS commissioners chastise Congress for slashing the tax agency's budget, urge full funding
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