What $80B in stimulus funding for the IRS could mean for taxpayers

WASHINGTON (NewsNation) – Underneath Inflation Reduction Act in 2022, that is Internal Revenue Service will spend an additional $79.6 billion over the next 10 years to help agencies dig out of the backlog of unprocessed paperwork, and staff for the nation’s top goals.

The act, which is expected to pass the House of Representatives before going to President Biden’s desk for signature, will add 87,000 new IRS agents to the list of agencies. It is expected to help speed up the processing of refunds that some taxpayers have been waiting 10 months to receive.

The legislation’s Democratic sponsors are also targeting wealthy people who cheat on their taxes, with $46 billion of the $80 billion earmarked for audit.

Ben Wilkerson, a Managing Attorney at North Mississippi Legal Services, said these audits are sometimes tilted against lower-income earners.

“There is no rhyme or reason that I can find out who is being audited,” he said.

Wilkerson has helped hundreds of low-income families affected by IRS audits. He said going after these individuals is less work and faster — while wealthier filers have the resources to fight the agency.

A recent learn from Syracuse University found the poorest families were audited at a rate five times higher than everyone else.

That figure compares to just 2% of audited millionaires in 2021.

Syracuse professor Susan Long said the Inflation Reduction Act could give agencies the energy they need to change those practices.

“It’s really revolutionary,” he says. “Over the years, the IRS has been starved of resources but has been given more tasks as we see and get things done. You know, it takes steps; that’s the way the world goes around.”

IRS Commissioner Charles Rettig said in one mail to the Senate last week that the source of the Inflation Reduction Act “is not really about increasing audits on small businesses or middle-income Americans.” Instead, it would bring the IRS “back to historical norms in challenging areas for the agency,”

Funds received will also go toward “employees and IT systems that will enable us to better serve all taxpayers,” Rettig wrote.

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