economy

What's Going on With the IRS?

The Trump administration's budget cuts are looming over Tax Day.

What's Going on With the IRS?

TL;DR

  • The IRS has experienced a significant decrease in staffing, losing nearly a fifth of its employees, which impacts its ability to address backlogs and outdated technology.
  • Budget cuts have led to the departure of many senior employees, resulting in a loss of institutional knowledge and experience.
  • Changes in immigration enforcement have led the IRS to share data with Homeland Security, potentially discouraging undocumented individuals from filing taxes.
  • The IRS is struggling with a substantial "tax gap" (the difference between taxes owed and collected) and a backlog of unprocessed returns.
  • Despite technological advancements in some areas, much of the IRS's essential infrastructure relies on outdated programming languages.
  • Federal spending on the IRS is presented as a sound investment, with audits of high-income earners yielding significant returns.
  • Customer service operations have been strained, requiring staff from other divisions to handle calls, regardless of their expertise.