Cutting Through the Misinformation About The IRS

Maybe the better question is what is the optimal audit rate and method, given the new
resources?
Next question: Does the IRS plan to use less burdensome tools in its enforcement
arsenal, short of audits?
For example, the agency currently matches Forms W-2 and 1099 to individual income
tax returns. If it finds a discrepancy above a threshold dollar amount, it will notify the tax
filer.
In 2018, the IRS received 2.8 billion information returns and detected 22.3 million
discrepancies. But it could afford to select just 2.9 million of the mismatches for further
review. That’s about half the rate of a decade ago. Should that historic rate be restored?
About those 87,000 armed agents. In May 2021, the Biden Administration projected
the IRS would hire 86,852 new employees over the next decade if Congress approved
the $80 billion. But it never provided a detailed breakdown of what types of positions
would be filled.
Republicans filled the information vacuum with the specter of 87,000 armed IRS agents
terrorizing innocent people.
That’s ludicrous. Less than 3 percent of IRS employees are authorized to carry
weapons. They are agents of its Criminal Investigations unit whose targets typically are
drug dealers, money launderers, and others suspected of serious, often-violent, crimes.
The IRS is currently hiring about 300 more.
And the critics willfully ignored some breadcrumbs in those 2021 Administration
estimates: Some of those new hires would work in taxpayer services or technology.
More recently, Administration officials asserted that 50,000 of the new hires would
replace retirees.
Still unanswered: Will the new hires do the same work as the people they are replacing,
or will the IRS create new positions more suitable for the 21 st century? The answer has
implications for the type of agency the IRS will be in the future.
About hiring. Senator Rick Scott (R-FL) warns people not to take jobs with the IRS. If
Republicans take Congress in January, he says, the $80 billion will be history and those
new hires will lose their jobs. Well, that’s not true. Biden still would hold the veto pen,
and civil service rules make it hard to fire government workers.
But it already is tough for the IRS to hire in today’s competitive market. At the last
minute, Congress dropped from the IRA provisions that would have made it easier for
the IRS to recruit. But Congress can restore that language in future spending bills, and
the Office of Personnel Management has discretionary authority to do the same.