12/09/2021

Senate Republicans Want to Restrict IRS Funding Boost

They fear too many will be targeted for accessing loopholes

Senate Republicans plan to offer an amendment to Democrat’s Build Back Better Act that would restrict the IRS from using additional funding in the package to audit households making $400,000 or less.

The House-passed reconciliation bill includes an additional $80 billion in funding for the Internal Revenue Service (IRS), and Democrats have said increased IRS enforcement to collect unpaid taxes will help offset the $1.7 trillion price tag for the BBB Act.

Republican lawmakers say the $80 billion in funding would lead to roughly 1.2 million more audits per year, close to half of which would target households making under $75,000 a year.

“If you look at where the tax gap supposedly is, interestingly, it falls mostly on those making less than $500,000 a year,” said Senate Finance Committee ranking member Mike Crapo (R-ID). “I think half of it roughly, 40 percent to 50 percent, falls on people making $100,000 or under.”

Senate Finance Committee Chairman Ron Wyden (D-OR) said several weeks ago that the funding boost for IRS enforcement will enable the revenue collection agency to target wealthy Americans who cheat the system.

“Without these investments in rebuilding the IRS, more and more of the tax burden is going to fall on working people who pay taxes with every paycheck because those at the top would know they can get away with more and more cheating,” Wyden said. “That’s not fair to millions of honest, hardworking taxpayers.”

This article was provided to OSAP by ASAE's Power of A and Inroads.