$1 Billion Recovered: IRS Cracks Down on Wealthy Tax Evaders with $80 Billion Funding Boost – What You Need to Know!

According to CBS News, the IRS recently announced a significant success in its efforts to recover unpaid taxes from wealthy individuals stating that it has reclaimed over $1 billion from wealthy tax evaders. This achievement follows a strategic crackdown on affluent taxpayers who owe the government money. The announcement that was made jointly with the U.S. Treasury Department underscores the positive impact of the $80 billion funding the IRS received from the 2022 Inflation Reduction Act. This funding boost has been used to enhance the IRS‘s capabilities, especially in terms of hiring more customer service agents and upgrading technology. These improvements were essential after the pandemic caused major delays and complications in processing tax returns. Contrary to false claims from some Republican lawmakers who argued that the funding would be used to hire 87,000 new IRS agents to audit low-income shoppers the IRS clarified that its focus is on improving service and targeting wealthy tax evaders.

The IRS is now conducting more audits on individuals earning over $1 million annually and those with tax debts exceeding $250,000. Federal officials have emphasized that the main targets are wealthy individuals and large corporations with a promise not to increase audit rates for Americans earning less than $400,000 per year. U.S. Secretary of the Treasury Janet Yellen highlighted the success of these efforts, stating that the initiative ensures tax fairness by holding wealthy taxpayers accountable just like working families. In May, IRS Commissioner Danny Werfel outlined plans to increase enforcement. These plans include tripling audit rates for corporations with assets over $250 million and boosting audits by 50% for individuals with incomes exceeding $10 million. The goal is to ensure that everyone pays their fair share of taxes.

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$1 Billion Recovered: IRS Cracks Down on Wealthy Tax Evaders with $80 Billion Funding Boost – What You Need to Know! (PHOTO: Boing Boing)

Furthermore, despite these efforts, there has been resistance from some Republican lawmakers. They have proposed several cuts to the IRS budget. In the summer of 2023, a $1.4 billion reduction to the IRS was included in a debt ceiling and budget cuts package. Additionally, an agreement was made to redirect $20 billion from the IRS over the next two years to other programs. Further cuts have been proposed for the fiscal year 2025 including reductions to the Direct File program which aims to make it easier for Americans to file their taxes directly with the IRS. Eugene Steuerle a fellow and co-founder of the Urban-Brookings Tax Policy Center noted that while increased investigations might seem intrusive, transparency in how the IRS conducts these audits could garner public support for the agency’s actions. By showing its methods the IRS could reduce the public’s fear of audits and increase backing for its initiatives.

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