More IRS Audits Are Coming for Americans at All Income Levels
The Democrats in DC finally noticed the high inflation in the United States — caused by their $2 trillion spending bill last year — so they passed a bill to spend even more on green energy, environmental workshops, and labor-union credits.
I’m sure this will fix inflation right away. (That’s sarcasm.)
One of the core elements of the “Inflation Reduction Act” is adding billions of dollars of new spending for IRS audits on Americans of all income brackets. I’m not sure why Democrats believe more IRS audits will decrease inflation, but it’s one of the largest programs in their “Inflation Reduction Act.”
Over the past decade, the power of the IRS has been used to target Americans. The IRS has engaged in audits because of Americans’ faith and political views. Now they can wield that power even more with tens of thousands of new auditors.
Meanwhile, the IRS has fallen behind in their actual task: processing Americans’ federal tax returns in a timely manner. Until about midway through last year, workers in the district office that serves Oklahoma were still working remotely. In some cases, they were many months behind processing returns, and if you filed your taxes on paper: Forget about it. It could be a year or more before you get an answer.
Oklahomans have told me they’ve waited hours to actually speak to someone at the IRS about their question. My office engages directly to help hundreds of Oklahomans get their issues resolved with the IRS. I even spoke to the IRS commissioner in a hearing about staffing needs at the IRS. Currently, only 20 percent of the calls to the IRS “Help Line” get an answer. It’s not uncommon for people to call the IRS early in the morning to hopefully get through by the end of the day.
The IRS does need help, but its first priority should be getting staff back in the office to be more effective and allocating any additional money to helping people get their questions answered before they file their taxes, rather than auditing them after they file, mishandling their information, or targeting them for their beliefs.
Most Americans file their taxes each year and hope that they did all the math correctly. Many people I talk to worry every year that they made a mistake on their complicated tax return.
Now, the chances of an audit have greatly increased for every American thanks to the “Inflation Reduction Act.”
The IRS now has $80 billion in new funding to go after American taxpayers with an estimated 87,000 new employees, likely to include tens of thousands of new auditors and enforcement agents, to be hired for what’s called “enforcement of underreported income.” The IRS has a quota of over $200 billion to raise from their new enforcement power, which means that, for the next ten years, the IRS will be measured on how many new audits they have conducted and how much new money they raise from the penalties they have imposed on Americans who just made an honest mistake. Meanwhile, less than 4 percent of the new funds are allowed to improve customer services for taxpayers such as answering phones, resolving tax-return questions and issues, and more.
Biden and the Democrats continue to say that the top earners in America aren’t paying their fair share and that they need more audits of high-income Americans to get revenue to pay for their Green New Deal. But the actual text of the “Inflation Reduction Act” does not limit the number or income of the people being audited. Every tax bracket will have increased audits.
According to the nonpartisan Joint Committee on Taxation, almost all (up to 90 percent) of the money raised from under-reported income could come from taxpayers earning less than $200,000 a year. But less than 10 percent could come from those making $500,000 or more. This fact was known before the bill passed, so Senate Republicans brought an amendment during the debate of the “Inflation Reduction Act” to prohibit audits on those who make less than $400,000, but Democrats voted that amendment down.
Remember last year when the Biden administration wanted to require all banks to report to the IRS information on the deposits and withdrawals of customers’ accounts over $600? Americans were furious about the intrusion into their private banking, and they rightly asked how focusing on $600 flows in and out of accounts was intended to only target millionaires and billionaires. Thankfully, after public outcry and major pushback from senators, including me, Democrats dropped that proposal.
This time, the “Inflation Reduction Act” text was released and passed through the Senate within hours so the American people would not have any time to speak out against the new IRS powers.
Remember last year when there was a massive leak of more than 15 years’ worth of legally protected, personal taxpayer information from supposedly “wealthy” Americans to the media? I raised the IRS-leak issue again recently in a hearing with Treasury secretary Yellen, and she told me that it’s being taken seriously. But no one at the IRS has been held to account, and no charges have been filed. Apparently, the American people can be audited, but the IRS cannot.
Remember a few years ago when Lois Lerner was shutting down conservative nonprofits from accessing nonprofit status while left-leaning nonprofits’ applications were expedited? We investigated that while I served in the House, and Lois Lerner was held in contempt of Congress for her involvement in trying to shut down conservative nonprofits.
The IRS has proven that they are capable of misusing the tax authority they have for political purposes. That is reason enough to not give them even more authority to audit even more Americans.
Americans are furious about the “Inflation Reduction Act” for good reason. It does not reduce inflation, but it does increase our blood pressure.