Congress has just revoked another $20 billion in funding from the IRS — here’s why that’s a problem for all Americans

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Posted on 01/09/2025 1:02:00 PM PST by where's_the_Outrage?

When the IRS starts asking for money, many Americans get nervous. This time, though, the Internal Revenue Service isn’t trying to collect additional funds from taxpayers. Instead, Treasury Officials are asking Congress to provide access to $20 billion in funding that was lost due to an error in legislative language.

The Inflation Reduction Act of 2022 included $79.4 billion in funding for the IRS — $1.4 billion of which was rescinded to raise the debt ceiling last year. These cuts reduced the budget of the enforcement division by $20 billion. Unfortunately, the legislative language was duplicated in error in a September funding bill, putting the agency at risk of losing another $20 billion.

The consequences could be dire, as Treasury Deputy Secretary Wally Adeyemo warned reporters, “the IRS is going to potentially have to make dramatic decisions about stopping hiring and starting to budget for a world in which they don’t have $20 billion which will stop a lot of their progress. If they don’t get that $20 billion that is at risk they would run out of enforcement money at the current pace sometime in fiscal year 2025.”.....

Although you may not be too sympathetic to the plight of the IRS, the reality is that the loss of these funds is likely to have a real-world impact on what the agency can do. Adeyemo explained some of the things that would happen if the money is not restored:

Around 6,000 fewer wealthy individuals will be audited

Around 2,000 fewer large corporations will be audited

The IRS may have to freeze hiring

(Excerpt) Read more at moneywise.com ...

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