IRS crackdown on wealthy tax cheats nets $1 billion in revenue
The Inflation Reduction Act’s IRS modernization is already yielding results.
President Joe Biden’s Inflation Reduction Act of 2022 included funds to modernize the Internal Revenue Service, including to expand the agency’s resources for cracking down on wealthy individuals making more than $400,000 annually who do not pay what they owe each year in taxes. Already the effort is paying dividends.
The U.S. Department of the Treasury and the Internal Revenue Service announced on July 11 that their efforts to collect past-due revenue from the highest earners have brought in more than $1 billion.
As points of comparison, $1 billion would more than pay for the entire cost of the federal program providing free and low-cost breakfasts and lunches in schools for two weeks.
It would pay for the operation of the entire National Park Service for more than three months.
And it would more than pay for the $225 million in bridge repair funding Wisconsin will receive over five years under Biden’s bipartisan 2021 Infrastructure Investment and Jobs Act.
Wisconsin Democratic U.S. Sen. Tammy Baldwin voted for the Inflation Reduction Act, as did Democratic U.S. Reps. Gwen Moore and Mark Pocan.
But every Republican in Congress, including Sen. Ron Johnson and Reps. Scott Fitzgerald, Mike Gallagher, Glenn Grothman, Bryan Steil, and Tom Tiffany, voted no.
Republicans falsely claimed the law would create an army of armed federal agents to harass working families. “Today the House voted on whether or not we ought to hire 87,000 new IRS agents to come after average Americans,” tweeted Tiffany in August 2022. “I voted NO.”
CNN debunked this claim in January 2023, reporting that while a 2021 Treasury Department document noted that the funds could enable 86,952 full-time employees to be hired over a decade, not all of those hired would be agents, and many would replace the 52,000 IRS employees expected to retire by 2028.
The five representatives and first-term Rep. Derrick Van Orden voted in January 2023 for a bill to rescind the IRS modernization funding.
A February analysis by the IRS and Treasury Department estimated that the crackdown could net $851 billion by the end of 2034.
