IRS officials promise a new wave of enforcement efforts as the agency bolsters its workforce. As many as 700 new agents will soon go to work investing international tax matters and identity theft. The new effort will also crackdown on refund fraud.
The agency previously had not hired significant numbers of enforcement personnel in the past five years. Commissioner John Koskinen describes the recent move as one that will have a positive effect on revenue and the tax system in general.
The increasing numbers of individual and business taxpayers who have not been paying the proper amount of taxes spurred the decision to hire new employees. The IRS also has lacked sufficient labor resources to track down criminals who have stolen identities and obtained refunds under pretense. As the federal government faces mounting deficits, politicians and bureaucrats have looked to the IRS to increase its collection activities.
Congressional budget cutting and attrition caused by retirement and employee turnover had depleted the number of staffers employed by the IRS. After losing more than $900 million in operating capital since 2010, the IRS had to tighten its belt. In fact, in recent testimony before Congress, Koskinen had urgently requested a $1 billion budget increase to help his agency fulfill its obligations. The Commissioner has raised eyebrows on Capital Hill with his recent hiring announcement, leading some representatives to wonder where the IRS found the money to pay for its new recruits.
According to Koskinen, many years of underfunding has forced his agency has forced the IRS to find ways to do more with less money and fewer people. Increases in efficiency have left the IRS with the extra cash on hand that Koskinen will use to pay the new workers. The coming crackdown on business and individual taxpayers, as well as fraud, will bring enough money into federal coffers to justify the ongoing cost of the expanded IRS workforce.
Two Hiring Phases
Hiring the new enforcement employees will take place in two waves. First, the tax collection agency will fill entry level positions in the Small Business and Self-Employed Divisions. The workers will have basic enforcement responsibilities. The second wave will fill jobs above entry level with people charged with tracking down international tax cheats and criminals who have fraudulently obtained refunds and identity theft. The IRS will also fill positions in the Large Business and International divisions. Tax Exempt and Government Entities departments will also receive new workers.
Koskinen has said that the two hiring waves will not restore the agency to its original staffing level, but they will fill substantial gaps that have prevented the IRS from pursuing people and organizations who have not complied with tax regulations.
Self-employed taxpayers and small businesses can especially expect the new round of hiring to trigger a significant number of audits, but companies and taxpayers with overseas income can also expect to face increased scrutiny.
The complexity of myriad regulations and rules set the stage for additional tax liabilities of which some taxpayers were not aware. Similarly, inexperienced but enthusiastic IRS agents might wrongly target some taxpayers. No one should face the IRS alone. Taxpayers facing audits should immediately contact a tax attorney for representation.