Watchdog: IRS budget cuts hurt taxpayers

The IRS’s watchdog agrees with the agency on this point: Slashing the tax collector’s budget has taken a toll on taxpayers.

The Treasury inspector general for tax administration found in a new report that reduced resources have forced the IRS to pare back the number of staffers who try to collect from delinquent taxpayers. 

{mosads}“The availability of key collection employees directly affects taxpayer service and the IRS’s ability to take appropriate enforcement action on delinquent taxpayers,” J. Russell George, the tax watchdog, said in a statement.

George added that the budget cuts could increase the number of taxpayers who decide to follow the tax system. “Taxpayers may become frustrated and remain noncompliant if they are unable to reach a contact representative to resolve their tax issues,” he said.

IRS officials have made similar points in recent months, as they lobbied to stop years of budget cuts. The agency has seen its budget slashed by more than $1 billion over the last five years, from $12.1 billion in 2010 to $10.9 billion this year. 

But the IRS’s efforts have so far been unsuccessful. House Republicans have proposed cutting the agency’s budget by more than $800 million next year. 

The Treasury inspector general found that the IRS had imposed serious cuts on two separate programs for collecting revenue in recent years. The IRS removed roughly one in five telephone collectors from one of the programs, and more than a quarter of the revenue officers that held face-to-face meetings with delinquent taxpayers.

In all, the watchdog said revenue officers collected roughly 7 percent less in 2014 than in 2011, and closed around a third fewer cases.

GOP lawmakers have said that the IRS is getting more than enough money, and is not wisely using its resources right now.