With the nearly certain enactment of the Inflation Reduction Act, the Internal Revenue Service is on track to receive an additional $80 billion in funding over the next decade. Now it is up to the administration, IRS and Congress not to miss this opportunity to bring the primary tax collector of the country to 21. ^{scheduled tribe} century.

It would help if opponents of the new funding stifled their irresponsible claims that armed IRS agents are going to go after middle-income families. And it would also help if the IRS clearly stated how would like Use the new money.

Funding is an amazing political achievement. Let’s face it, the IRS isn’t exactly the prom king of government agencies. And its unpopularity made it easy for Congress to cut its funding in real dollars by more than 20 percent since 2010, with its particularly defiant enforcement staff taking the hardest hit.

The reality is that the $80 billion boost will be spread across the agency, with funds flowing to enforcement, taxpayer services, operations and modernization.

About $46 billion – or 57 percent – will be allocated for tax enforcement. This has fueled claims that the IRS will deploy as much 87,000 new agents – “an army of auditors”– Which additional 700,000 . Flyspec will make the return of Walmart Buyers, some conservative commentators have gone even further, warning that those agents may be carrying guns.

Neither the Biden administration nor congressional Democrats are particularly interested in cracking down on the vast majority of taxpayers who take the standard deduction and whose income is reported on W-2s and 1099s. one in Letter This week to IRS Commissioner Charles Rattig, Treasury Secretary Janet Yellen confirmed that enforcement money would be used to target the very wealthy, large corporations and partnerships. Walmart, maybe, but not its customers.

Despite Yellen’s attempt to clean up a mess, with a number and a few words, the administration left itself open to Republican accusations.

First, about those 87,000 auditors. is buried last year’s treasury report On its compliance agenda was an estimate that if the IRS receives an additional $80 billion, its workforce would increase to 86,852 — or nearly double by 2031.

This is a really accurate number to include in a government report, without explaining where it came from. But the hires will not be the only auditors. The new workforce will include more customer service representatives to help eligible taxpayers claim the Child Tax Credit and Earned Income Tax Credit, the report said. And of course, the IRS would need to hire a lot of skilled people. computer scientists Developing new technologies to improve both enforcement and taxpayer services.

Ultimately, the agency must replace the thousands of critical workers who have been laid off over the past decade.

However, the Treasury opened itself up to the Walmart charge the other way round. The report also stated that the audit rates for taxpayers earning less than $400,000 . will not increase relative to recent years. And in this week’s letter, Yellen wrote that the new funds would not be used to increase the share of small businesses or households earning less than $400,000, relative to those audited. historical Level.

But what does Treasury mean by “recent” or “historic”? A decade of deep budget cuts have come down audit rates for personal income tax return 0.4 percent In 2019 from 1.1 percent in 2010. And that was before the pandemic slowed the audit. Keeping audit rates at pandemic levels will not be an effective long-term compliance strategy.

The Treasury Agenda took a broader vision. Yet, despite the very precise number of new workers promised, the Biden administration has failed to describe in detail how the staff and technology will be deployed.

A shout out to drafters of the first version of the Inflation Reduction Act, which would require the IRS to submit a spending plan to Congress within six months with periodic updates. There was also a $100,000-a-day fine for missing those deadlines.

Reporting requirements are responsible governing. Unfortunately, the mandate had to be dropped, probably because it violated Senate rules for budget reconciliation bills.

But the IRS and the Treasury need not be ordered to explain what they will do with the additional $80 billion. They should simply answer basic questions such as:

• How will the audit selection tool be refined so that compliant taxpayers are not audited?
• Will new auditors have the skills and experience to avoid being outgunned (figuratively, of course) by the army of sophisticated tax advisors hired by the wealthy and large businesses?
• What advances in technology will help taxpayers?

Even without a Congressional mandate, the IRS must submit a detailed spending plan within six months and update it regularly. That’s a small price to pay for $80 billion.