Is Biden Hiring 87,000 New IRS Agents? Not Exactly.
A new meme started by Republican leaders is mostly false.
TIME (“Trump Allies Are Attacking Biden For a Plan to Hire 87,000 New IRS Agents That Doesn’t Exist“):
Since news broke on Monday that the FBI searched former President Donald Trump’s South Florida home, Republican members of Congress and right-wing media figures have launched a new line of attack against Democrats: that the Internal Revenue Service intends to use nearly $80 billion in new funding to pursue similar intrusions on average Americans. Those dollars, Trump allies are saying, will go toward the hiring of 87,000 new IRS agents.
“Do you make $75,000 or less?” tweeted House Minority Leader Kevin McCarthy. “Democrats’ new army of 87,000 IRS agents will be coming for you—with 710,000 new audits for Americans who earn less than $75k.” Richard Grenell, Trump’s former Acting Director of National Intelligence, wrote on the social media platform: “The FBI raids Trump’s house and the Democrats vote to add 87,000 new IRS agents to go after Americans. Wake up, America.”
Other high-profile conservatives have insinuated that the Biden administration intends to direct those additional auditors to dig up dirt on the President’s political opponents. “After todays raid on Mar A Lago what do you think the left plans to use those 87,000 new IRS agents for?” tweeted Sen. Marco Rubio.
I’ve definitely seen this going around on Facebook, including from folks who are fairly intelligent and not prone to extremist nonsense.
There’s only one problem. It’s not true.
As problems go, that’s pretty significant.
The Inflation Reduction Act, a landmark climate, health care and tax package that passed the Senate on Sunday and is expected to head to Biden’s desk after the House approves it on Friday, includes roughly $78 billion for the IRS to be phased in over 10 years. A Treasury Department report from May 2021 estimated that such an investment would enable the agency to hire roughly 87,000 employees by 2031. But most of those hires would not be Internal Revenue agents, and wouldn’t be new positions.
So, it’s more truthy than an outright lie. The 87,000 number is real, it’s just being misrepresented.
According to a Treasury Department official, the funds would cover a wide range of positions including IT technicians and taxpayer services support staff, as well as experienced auditors who would be largely tasked with cracking down on corporate and high-income tax evaders.
From the standpoint of an ordinary citizen, calling the latter “IRS agents” isn’t unreasonable. But, surely, IT techs and service support staff shouldn’t be characterized this way.
“It is wholly inaccurate to describe any of these resources as being about increasing audit scrutiny of the middle class or small businesses,” Natasha Sarin, a counselor for tax policy and implementation at the Treasury Department, tells TIME.
So, I’m actually skeptical of that. Rather obviously, neither the Biden administration nor Congressional leadership intended to sic the IRS against the little guy with this new funding. Their rhetoric, which I believe, is about going after the big fish who are skirting the rules to radically underpay what they owe. Still, as noted a week ago in “Coming IRS Crackdown?” Congress’ own independent tax staff estimates that “78% to 90% of the money raised from under-reported income would likely come from those making less than $200,000 a year.” Further, small businesses, especially “pass throughs” including Subchapter S businesses that file under the individual tax code, are likely a particular audit target.
At the same time, more than half of the agency’s current employees are eligible for retirement and are expected to leave the agency within the next five years. “There’s a big wave of attrition that’s coming and a lot of these resources are just about filling those positions,” says Sarin, an economist who has studied tax avoidance extensively and who was tapped by the Biden administration to beef up the IRS’s auditing power.
It’s honestly weird to include the replacement of positions that will naturally attrite in one’s hiring report. It just sets up this sort of wild conjecture.
In all, the IRS might net roughly 20,000 to 30,000 more employees from the new funding, enough to restore the tax-collecting agency’s staff to where it was roughly a decade ago.
Finally, we get to the key point and it’s one I’ve pointed to many times* in recent years: the IRS has slowly been gutted during times of Republican government.
The IRS currently has roughly 78,000 employees. According to John Koskinen, who served as IRS commissioner from 2013 to 2017, that’s down from around 100,000 when he first started. By the time he resigned four years later, he said, it was clear that the agency was in the grip of a systematic attempt by the GOP to weaken it.
“Nobody loves tax collectors,” Koskinen tells TIME.
It’s an effort that goes back to 2010, when Republicans took back control of the House of Representatives and immediately instituted a series of crippling cuts on the IRS. Since then, overall funding for the IRS has fallen further, by more than 20 percent, while enforcement funding has dropped by 31 percent. That’s made it easier for high-net-worth tax cheats and major corporations to avoid federal taxes to the tune of billions of dollars.
“The largest corporations in the United States with over $20 billion of assets have had their rate of audits go from nearly 100% to 50%,” says Janet Holtzblattt, a senior fellow at the Urban-Brookings Tax Policy Center. “Among wealthy individuals who had a positive income of a million dollars or more, the audit rate fell from 8.4% in 2010 to 2.4% in 2019.”
This, naturally, was the whole point of the cuts. Not only does it benefit companies who tend to be Republican-friendly but it also reduces government revenue, making it harder for new programs to “pay for themselves” and therefore advance the long-term goal of making government so small you could drown it in a bathtub.
Meanwhile, the employee shortage only made it harder for average Americans to reach IRS customer support, which has been inundated with requests far beyond what the staff could handle. “I used to say there’s no Democratic or Republican way to run the IRS,” Koskinen says. “The people who are significantly disadvantaged are the average taxpayers who have a simple question and can’t get through. Those are Republicans as well as independents and Democrats.” As of last month, the IRS backlog included 10.2 million unprocessed individual returns.
This is also diabolical, in that it vexes ordinary folks trying to file their own taxes—as required by law—thus further turning them against the Federal government, its bureaucracies, and the whole process of paying one’s taxes.
*See especially my spring 2019 posts “Taxing the Very Rich” and “It’s Hard to Audit the Rich, So We Go After the Poor.”