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IRS funding now below 2009 threshold

Jan. 20, 2014 - 06:00AM   |  
By SEAN REILLY   |   Comments
IRS building, Washington D.C. (Wikimedia Commons)

Despite an in-house watchdog’s warning that that the IRS “desperately” needs more money to do its job, the agency is getting less funding this year than it received in 2009, according to the House Appropriations Committee.

For fiscal 2014, the agency will receive $11.3 billion, a figure that locks in most of last year’s sequester-related funding cuts, the committee said in summarizing the impact of a newly passed spending package. The Obama administration had requested almost $12.9 billion.

The package, signed into law Friday by President Obama, was unveiled days after National Taxpayer Advocate Nina Olson told lawmakers that previous cuts to the IRS’s budget were “shortsighted and counter-productive,” because they lead to reduced services to taxpayers and undercut efforts to increase tax revenue collections.

“The IRS desperately needs more funding to serve taxpayers and increase voluntary compliance,” wrote Olson, whose independent office is housed within the IRS. From 2010 to 2013, the agency’s workforce fell about 8 percent to 87,000 employees, she said. During the same period, its training budget tumbled from $172 million to $22 million, an 87 percent cut.

As a result, Olson wrote, the IRS “not only has fewer employees than four years ago, but those who remain are less equipped to perform their jobs.” Her annual report to Congress was made public Jan. 9, four days before lawmakers released the spending package text.

In the bill and accompanying explanatory statement, lawmakers did not spell out their rationale for further cutting the IRS’s budget. But, as Olson noted, last year was a difficult one for the agency, which found itself in the congressional cross-hairs after its inspector general found that “inappropriate criteria” were used to evaluate Tea Party groups seeking tax-exempt status. The scandal helped force the resignation of acting Commissioner Steven Miller in May; the Senate confirmed John Koskinen as a permanent replacement only last month. The agency also faced questioning following the disclosure of a 2010 video that featured employees in a“Star Trek” parody.

In the new spending bill, Congress bars the IRS from singling out groups based on their ideological beliefs, and earmarks a minimum of $200,000 for training employees in its tax-exempt unit.

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