Kerby Anderson

Will all the new federal funding for the IRS make it a more efficient governmental agency? The editorial board of the Wall Street Journal doesn’t think so. They remind us that many progressives wanted the president to unleash what they call “beast mode” and use all executive power to advance their agenda.

The recent bill included $80 billion in new funding for the IRS. The assumption is that greater scrutiny of tax filings will yield more than $200 billion in revenue. I’m skeptical of the cost/benefit used in the legislation, but I do believe that the only way to reach that goal will be to send IRS auditors after tens of millions of tax-paying Americans.

To put these numbers in perspective, remember that the current IRS budget is $12.6 billion. Much of the funding is earmarked for “enforcement” and “litigation.” It also includes “investigative technology” and “digital asset monitoring.” If you think that this new money will result in better IRS service, remember that during the 2022 filing season, the IRS answered a mere 10 percent of the phone calls.

It is likely the IRS will go after more than just a few wealthy individuals. The target will be middle-class and upper-middle-class Americans. That’s where the money is. The Joint Committee on Taxation in Congress estimated that 78-90 percent of the money secured will come from under-reported income from people making less the $200,000. Only 4-9 percent would come from those making more than $500,000.

Unfortunately, I suspect that many individuals and small businesses will settle with the IRS rather than endure costly expenses of appeal and litigation even if they have a good case. This is what will happen when the IRS goes “beast mode.”