Biden’s fund infusion to the IRS appears to be paying off this tax season
Filed in style… Tax Day was Monday, and the IRS is giving itself a lot of credit. The agency said it had reduced customer-service wait times to an average of three minutes — down from four minutes last year and 28 minutes in 2022. That’s despite receiving nearly 1M more calls this year and helping 88% of callers (in 2022 it answered just 15% of calls). What changed:
Billions: In 2022, the Biden admin approved $80B in fresh funding to modernize the IRS, an amount later reduced to $60B by budget-conscious GOP members.
Money talks: “This shows that when it has the resources it needs, it will provide taxpayers the service they deserve,” Treasury Secretary Janet Yellen said.
Fresh discresh… After receiving its new allowance, the IRS hired 5K staff to help digitize its tax archives, ramped up audits, and said it collected $500M from delinquent millionaires. Still, The Wall Street Journal reported that over half of new audits last summer were directed at folks making less than $200K. The IRS also rolled out its Direct File program, which lets taxpayers with simple returns file directly online at no charge. It’s bad news for third-party tax-prep services like Intuit’s TurboTax and H&R Block. Direct File’s been introduced in 12 states so far, but the IRS said it met its goal of getting 100K people to use the service this year.
The IRS has lifestyle creep… The Internal Revenue Service has taken big steps toward modernizing with new funding, but the agency said it’ll need more budget to keep up the momentum and ramp up audits of Big Biz. It’s why the IRS is touting its achievements now to show legislators that you get what you pay for — in this case, more tax $$ to fund the government.