IRS budget cuts have led to declines in taxpayer services, tax case closures, and collections of overdue taxes, according to a recent report from the Treasury Inspector General for Tax Administration.
The report found that the IRS budget cuts from fiscal years 2010 to 2015 led to a 21% reduction in automated collection service representatives and a 28% drop in field collection revenue officers.
Along with IRS staff levels, field collection amounts have declined from US$3.244 billion in fiscal year 2011 to US$3.02 billion in fiscal year 2014. In the same time span, the number of closed tax cases dropped from 125 to 110.
But it’s not only government coffers that are suffering from the IRS budget cuts. The reductions are also blamed for a 25% drop in taxpayers’ phone calls being answered by the remaining automated collection service staff. Those who were lucky enough to have their calls answered saw their wait time nearly double, going from 8.1 minutes in 2011 to 15.9 minutes in 2014.
Russell George, head of the inspector general’s office that oversees the IRS, stated that the reductions in efficiency and effectiveness at the IRS were a result of the budget cuts.
“The availability of key collection employees directly affects taxpayer service and the IRS’ ability to take appropriate enforcement action on delinquent taxpayers,” George said in a statement issued with the report.
With Republicans controlling both the Senate and the House, the budget situation will likely remain the same for the IRS. Hostility toward the IRS among Republicans is fierce as a result of allegations that the IRS targeted conservative political groups for greater scrutiny when the organizations applied for tax-exempt status.
President Obama has suggested US$12.9 billion in IRS funding for fiscal year 2016, a US$2 billion increase. However, House Republicans responded with a suggestion of their own: US$838 million in IRS budget cuts.