Tags: IRS | budget | Republicans | scandal

NYT: The Real IRS Scandal Is in the Budget Cuts

By    |   Monday, 07 July 2014 02:41 PM

Republicans investigating the IRS for allegedly targeting Tea Party groups thought they found a scandal when the IRS said emails Congress sought were lost.

The real IRS scandal isn't about missing emails. It's about Republican budget cuts that have eviscerated the agency, according to The New York Times Editorial Board.

Congress has cut the IRS budget 14 percent since 2010 after taking into account inflation, according to The Times. That leaves the agency with less staff to enforce tax laws, serve taxpayers and audit tax returns.

Editor's Note:
Seniors Scoop Up Unclaimed $20,500 Checks? (See if You qualify)

"Middle-class taxpayers who struggle to fill out their 1040s may welcome a diminished threat of an audit, but in fact this reduction is not about them," The Times opines. "The IRS audits a far higher percentage of tax returns from people reporting incomes over $200,000 than from those reporting less, because that is where the money is."

The IRS audited 30 percent of returns reporting income higher than $10 million in 2010, but only 24 percent of those returns in 2013. It audited 21 percent of returns reporting incomes between $1 million and $5 million in 2010, compared with 16 percent in 2013.

That's great for those with high incomes, who often donate to Republican politicians to keep their taxes low, the editorial states.

"They are getting their money’s worth from lawmakers who debilitate revenue collection while claiming to be deeply worried about the budget deficit."

Gutting IRS funding means less money for government services, such as fixing roads or national security.

Every dollar spent on IRS enforcement generates $6 in additional revenue, The Times notes, pointing to a report from the Center on Budget and Policy Priorities. Revenue from IRS enforcement actions has dropped more than $4 billion in the last four years.

The supposedly scandalous revelation only shows that the IRS isn't better at backing up computer files than other government agencies are.

Jared Bernstein, former chief economist to Vice President Joe Biden, believes the Congressional investigation is an attempt to distract the public from its IRS budget cuts.

"This is just a different way to try to shrink government, accommodate tax evasion and even undermine the implementation of health reform," Bernstein writes in an article for The Washington Post. "To collect taxes, we need an amply funded IRS, and therein lies the real scandal."

A paper from the Center on Budget and Policy Priorities says the budget cuts have force the IRS to slash employee training and postpone technology upgrades, which has weakened its ability to serve taxpayer, he says.

Editor's Note: Seniors Scoop Up Unclaimed $20,500 Checks? (See if You qualify)

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Republicans investigating the IRS for allegedly targeting Tea Party groups thought they found a scandal when the IRS said emails Congress sought were lost.
IRS, budget, Republicans, scandal
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2014-41-07
Monday, 07 July 2014 02:41 PM
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