87,000 More IRS Agents
All thanks to the Inflation Reduction Act
On Tuesday of this week, August 16, President Joe Biden signed a bill that has been a long time in the making. With a name almost more Orwellian than notable bills such as the Patriot Act or the Affordable Care Act, the Inflation Reduction Act is a significantly scaled-back version of Biden’s “Build Back Better” bill that was killed in the Senate earlier this year, and it does practically nothing to address inflation.
While less sweeping than the original bill, this current iteration still pertains to everything from taxes to health care and even climate policy. It narrowly passed both chambers of Congress through party-line votes before reaching the President’s desk.
There’s much to criticize about this bill, but I want to focus specifically on the nearly $80 billion allocated to the Internal Revenue Service (IRS), which is more than six times the agency’s annual budget. Along with a massive influx of funding, the bill allows the IRS to hire roughly 87,000 new agents over the next ten years with the supposed intention of going after wealthy tax cheats in order to bring in more tax revenue. However, the idea that only the wealthy will face an increase in audits is, frankly, naive.
It is true, as some have pointed out, that not every single one of those new agents will be auditors. It’s also true that out of the 79,000 people currently employed by the IRS, a large portion of them are expected to retire within the next six years. However, as Matt Welch recently wrote for Reason:
The agency has tried gamely to make the 87,000 hiring number seem less scary, insisting (as the White House did Thursday) that "the IRS would need to hire 52,000 people over the next six years just to maintain current staffing level to replace those who retire or otherwise leave." An employee attrition rate of two-thirds over just six years seems a tad on the exaggerated side. [Emphasis added]
Out of the $80 billion that the bill allocates to the IRS, more than half ($45.6 billion) is specifically for enforcement. So the idea that none of that enforcement will be directed at lower-middle-income Americans seems hard to believe.
For instance, those who make more than $400,000 a year (that number matters because Biden has promised not to raise taxes on anyone who makes less than that) can likely afford accountants and lawyers in order to exploit any loopholes in the tax code and combat any attempts at being audited. That’s especially true for the millionaires and billionaires that “don’t pay their fair share” as progressives often put it.
Middle-class Americans and those living in low-income households don’t have that same luxury and have typically been audited more frequently than those who are wealthy. In fact, an analysis by the Transactional Records Access Clearinghouse (TRAC) at Syracuse University published earlier this year found that those making less than $25,000 a year were audited five times more often than those with higher incomes.
There’s no reason to assume that will change anytime soon, especially with a significantly ramped-up IRS. To make matters worse, Democratic senators actually struck down an amendment to the bill that would’ve explicitly stated that the 87,000 new agents would not be used to go after those making less than $400,000 a year. As Matt Welch said, “You'll just have to take Democrats' word for it.”
What makes this situation even more concerning is that the IRS has been quietly purchasing more guns and ammunition than usual over the last several years, which likely means some of that $80 billion will go toward continuing that trend. On top of that, a now-deleted job listing posted by the IRS recently explicitly stated that agents may need to “carry a firearm and be willing to use deadly force, if necessary.”
This isn’t to say that there’s never a situation where IRS agents might be put in danger and need to be able to defend themselves, but most audits shouldn’t escalate to the point of physical violence, let alone deadly force.
This new development is not good news for working-class Americans, but none of this means that the IRS will immediately begin auditing people and threatening them with violence as it’ll be years before we actually see the repercussions. To be completely honest, most people probably won’t even notice a difference in the near term. However, this massive increase in funds and personnel for an agency already rife with problems (what government agency isn’t?) significantly increases the likelihood that at some point in the not-too-distant future, average U.S. citizens will be affected.
This expansion of a government agency — one that is literally designed to rob Americans of their wealth — is a worrying part of a much broader trend, in which governments around the world have increasingly become more authoritarian, particularly since the onset of the Covid-19 pandemic.
Don’t let anyone convince you that these 87,000 new IRS agents will only be going after wealthy tax cheats. They will go after any of us, regardless of income, and those toward the bottom will more than likely be impacted the most. All thanks to the Inflation Reduction Act, a bill that doesn’t even reduce inflation.
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