IRS Asks for Raise, Needs an Audit

Eleven billion dollars is just not enough for the IRS to get all its work done.  John Koskinen, newly appointed IRS Commissioner, says they need a bigger budget, not cuts.  He’s backed up by President Obama, who proposed a 10% increase in the IRS budget for next year, exceeding current spending caps – even while proposing a reduction in the defense budget.

But the Republican-led House – currently investigating the IRS for targeting conservative groups applying for tax-exempt status – is not feeling their pain.

Koskinen warns that the performance of the agency will suffer without more funds.  But call response rates are already low and expected to worsen.  Only 40% of callers actually get help navigating an overwhelmingly complex code to file their taxes.  One bright spot is that audit rates are predicted to go down, but that also means the IRS won’t catch as many tax evaders and thus collect less revenue.

In addition, the responsibility for enforcing Obamacare now also falls on the IRS.  They will have to verify subsidy approvals, distribute assistance to those who qualify, and issue penalties to Americans without health insurance – just 3 of 45 new provisions they are now responsible to enforce.

Koskinen says they’re ready for the challenge and see this as a chance for the agency to redeem itself.  We think it looks more like an opportunity to expand the power of an agency that cannot be trusted with the power it already has.  He also says they need more funding to meet the new responsibilities.  “We have fewer employees and resources, even as our responsibilities expand.”

Poor IRS.  Sounds like the same dilemma facing most Americans under this Administration – do more with less.

Meanwhile, the IRS will be incurring millions of dollars of additional cost to maintain their computer system because they missed a deadline.

Windows announced in 2008 that it would be discontinuing service for the XP operating system – that means no future security patches.  The end date has finally come and gone, and half the IRS computers are still running XP.  To avoid security risks, they’ll have to pay Windows $11.6 million for one year of Custom Support.  That’s almost as much as they’ll spend to upgrade the rest of the computers to Windows 7.

Koskinen blamed this on the budget too, but he said it shouldn’t impact taxpayers.  Which begs the question – where will they get the money? The same place the money came from to pay for expensive employee retreats and bonuses last year.

Before they get more of our money, maybe the IRS needs a course in money management – or at least a good audit.

Photo Credit: Cheryl Casey / Shutterstock.com