For weeks, Republicans have been telling voters across the country that President Joe Biden and Democrats will be sending an army of 87,000 IRS agents to audit everyday Americans, to dig deeper into their pockets to pay for unfunded liberal programs like student loan forgiveness. Leading up to the midterm elections, GOP candidates are running campaign ads featuring the claim and vowing to stop the IRS, once Republicans control Congress again. Where did this idea originate and is there any truth to it? Here’s what to know about whether the tax men cometh.
Where did Republicans come up with this number?
The 87,000 figure comes from a Treasury report released in May 2021, which evaluated a proposal to provide the IRS with an additional $80 billion in funding. That amount of money has since been approved, courtesy of the climate, health care and tax law passed earlier this year.
The analysis showed that over 10 years, the IRS could add nearly 87,000 full-time employees. But nowhere does it say how many employees would be auditors versus other kinds of IRS employees, like customer service staff who can help taxpayers process their payments and receive refunds. The figure also represents the gross number of employees that could potentially be hired, not the net total as the agency faces attrition over the next decade.
What are Republicans saying about these IRS agents?
It varies. On social media, some are saying the IRS agents will be armed. Others, like Washington GOP Senate candidate Tiffany Smiley, are capitalizing on the sheer size of the number. It’s “insane that Joe Biden and Patty Murray are sending a stadium full or IRS agents to force families making less than $75,000 to pay for someone else’s law degree,” she says in one ad.
North Carolina Senate candidate Ted Budd complains in another ad that Mr. Biden has “spent recklessly,” and “now he wants 87,000 more IRS agents to cover his tab.” Meanwhile, House GOP leader Kevin McCarthy is vowing to repeal the 87,000 agents in Republicans’ first bill if they win the majority.
Are the claims true?
No, the claims are outdated and misleading. While the IRS will be getting $80 billion from the Inflation Reduction Act passed in August, the IRS has not yet released a plan for the money. In August, Treasury Secretary Janet Yellen sent a memo to IRS Commissioner Charles Rettig directing the agency to deliver a plan within six months on how the funding will be used over the next decade. Yellen also had another directive for the agency regarding new personnel and which Americans shouldn’t see more audits.
“Any additional resources—including any new personnel or auditors that are hired—shall not be used to increase the share of small business or households below the $400,000 threshold that are audited relative to historical levels,” she wrote in a letter. In a separate letter to the Senate, Rettig, a Trump appointee, also stated the resources are “absolutely not about increasing audit scrutiny on small businesses or middle-income Americans.”
The IRS proposal for the money is due in February.
So, what is the IRS spending on, if not 87,000 agents?
Of the $80 billion in funding – nearly $46 billion was allocated to go toward enhanced enforcement as the IRS looks to close the so-called “tax gap,” which currently stands at an estimated $600 billion annually and $7.5 trillion over the next ten years. Apart from enforcement, the money is also being used for improving taxpayers services and technology.
“The resources to modernize the IRS will be used to improve taxpayer services – from answering the phones to improving IT systems – and to crack down on high-income and corporate tax evaders who cost the American people hundreds of billions of dollars each year,” a Treasury official said.
The IRS has been facing growing challenges over decades which were exacerbated by the coronavirus pandemic. Some of the technology used by the agency dates back to the 1960s. In both reports and testimony before Congress, Taxpayer Advocate Erin Collins has described IRS employees having to manually enter information line by line from paper returns. She has called paper returns “kryptonite” in numerous warnings to Congress. Her midyear report in June stated the agency had a backlog of 21.3 million unprocessed paper tax returns at the end of May. That number has come down, though. The IRS recently said it had 6.2 million unprocessed individual returns as of Sept. 23, including 4.6 million paper returns to be reviewed and processed.
The IRS has also struggled with its customer service load. Its workforce remains at similar levels to the 1970s despite a growing population and additional responsibilities. In the last tax filing season, the agency was only able to pick up about 10% of calls – an issue that frustrated both Republican and Democratic lawmakers.
What will those hired by the IRS do?
Filling vacant positions, mostly. The IRS is on the verge of losing more than 50,000 employees who are set to retire over the next five years.
“The majority of new employees will replace the standard level of staff departures over the next few years,” said an Treasury official, adding that new staff will be hired to “to improve taxpayer services and experienced auditors who can take on corporate and high-end tax evaders, without increasing audit rates relative to historical norms for people earning under $400,000 each year.”
On the enforcement side, the IRS has lost 40% of the complex revenue agents needed to go after high-end tax evaders over the past decade. The agency is working with the same number of auditors dealing with complex work as it had in World War II.
Will IRS agents be armed?
Just a fraction of employees across the entire IRS are armed. The criminal investigation unit is a small division within the agency with less than 2,000 employees – less than 3% of total workforce. And within that unit, only special agents are armed, so even fewer than the 2,000 employees working there. The unit deals in matters such as narcotics and money laundering. Recently, it’s been part of the task force tracking Russian oligarchs’ assets.
