Economics of adding 87K IRS agents

Investment Analysis Clubs Macro Economic Trends and Risks
101

That is not what the report states. Your article appears to be conflating two different things. From the report linked in the article:

Quote from page 25:

Recommendation 4: The Commissioners, SB/SE and LB&I Divisions, should coordinate
examination planning to ensure that the examination plans will follow the Secretary of the Treasury Directive to prioritize coverage of individual high-income earners over $400,000.

Management’s Response: The IRS agreed with this recommendation. The IRS agreed
to ensure that the enterprise examination plan will follow the Treasury Secretary’s
directive to not increase audit rates above historic levels for households making less than $400,000 and small businesses.

The Report did go on to state that:

The IRS Commissioner should:
Recommendation 5: Establish a definition for high-income taxpayers in reference to
examination compliance for purposes of focusing on income levels above which taxpayers have unique and varied opportunities for tax avoidance.

Management’s Response: The IRS disagreed with this recommendation. It asserted
that a static and overly proscriptive definition of high-income taxpayers for purposes of
focusing on income levels above which taxpayers have unique and varied opportunities
for tax would serve to deprive the IRS of the agility to address emerging issues and
trends.

Further, the report goes on to state:

Recommendation 6: Further refine the examination activity codes scheme to better identify high-income individual returns.

Management’s Response: The IRS partially agreed with this recommendation. The IRS
agreed to identify the best method to identify and track high-income examinations as
part of the work being undertaken to implement the Treasury Secretary’s directive to not increase audit rates for households making less than $400,000 and small businesses.

Your source article appears to be trying to pull a rope a dope.

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102

For the first 100 years of the Republic government was mostly funded by tariffs.This was a way of shielding nascent US industries from predatory British industry, while raising monies in a way that was pretty easily identifiable given the state of income disclosure and tracking at the time.

And, of course, government did a lot less so there was less money to raise. (No standing army, no roads, no Fed, etc.)

With the advent of modern society the income tax was introduced, not without disruption and pain, but eventually it stuck, and over the past 100 years or so has been hacked to death with ever more carve-outs, exceptions, loopholes, incentives, and who knows what else. It’s a nightmare for ordinary people.

Europe adopted the Value Added Tax some years ago, a wholesale change which was met with the same kind of angst as the income tax, but it is now well established and provides a base of government income to those countries which use it. It has not eliminated the income tax in those countries however, so the price of everything is higher, but the “common funding” now has multiple legs on which to stand. The laws surrounding the many-and-various income taxes in Europe are more straightforward, at least as I have read, than what we have in the US.

But a consumption tax hits lower income people harder than higher incomers, so I would have to look pretty carefully to say this is a good solution. I do have to say tho’ that the overwhelming complexity of our system is rife and ripe with opportunities for mistakes and fraud, and I wish someone somewhere would figure out how to do something about it.

Including, by the way, more IRS agents to help, more IRS agents to investigate, and more IRS automation to make the whole thing smoother. It would also require Congress to close the doors to so many special interests that I fear it can never be done, at least until the empire falls, so I’m not expecting anything in my lifetime.

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103

Not true in the EU. Most of the VAT taxation goes to social services. Low income people live far better with retirements and healthcare. There is no comparison to the squalor in the US.

This is changing in the EU v US. The sociopaths are changing continents. The EU country by country decisionmakers had been honest brokers. Good luck with that now. The US is working its way to honest brokers now.

104

A new report from the Treasury Inspector General for Tax Administration on the initial implementation of the IRA found IRS is failing to bring on its first wave of specialists to focus on increasing compliance for large corporations, large partnerships and high-income/high-wealth individuals. The agency has made some progress—it has eliminated barriers to posting job openings—but is still facing headwinds that are largely outside of its control. Revenue agents for those roles have “yet to be hired and onboarded,” the IG said.

“External applications that have been received are far below the IRS targeted goal and there is an overall shortage of individuals with the desired background and experience,” TIGTA found.

A previous IG report found that despite its new funding, revenue agent staffing had actually decreased by 8%, or more than 650 employees, between the end of fiscal 2019 and March 2023. IRS had planned to bring on 3,833 revenue agents in fiscal 2023, but in the first six months officials had recruited just 34.

DB2

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105

So the IRS is having trouble finding and hiring staff for positions that require specialized knowledge. This is not surprising. Some school systems facing teacher shortages and growing teacher retirements have been offering teachers the opportunity to “retire” but continuing to work at full pay. Since they are retired they are not making retirement contributions any longer, it means that their take-home pay is like they have received a significant pay increase. Maybe the IRS should look into that type of arrangement if they haven’t already.

106

This isn’t all that surprising. They’d have better luck trying to fill a position that requires repeated kicks to the groin.

“Are you ready to make a difference finding tax cheats gaming an already rigged system? You can join an overburdened agency that is routinely demonized! Did we mention that your livelihood will be routinely threatened by politicians not interested in governing? Join us now!”…NOPE.

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107

…and that our computer systems are so antiquated that we can no longer maintain them?

d fb

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108

Especially as a faction among the (L&Ses) has cutting IRS funding as almost as high a priority as keeping brown people out of the US, so, if you join the IRS, you may be on the street again in a year.

Steve

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109

Heh.

Why didn’t you quote the most significant part of your link? :slight_smile:

IRS has already begun targeting such taxpayers, and is beginning to scratch the surface of its grand ambitions: an early campaign to target 1,600 seriously delinquent millionaires has so far resulted in more than $500 million recovered tax payments. Its larger efforts, however, are running into a wall—or perhaps more of a vacuum.

Man! Half a billion already recovered and they are just getting started!

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110

You need to get with the program. That is “half a billion of THEIR MONEY taken away from JCs”. “Bazzilions of jobs destroyed”. That is why the Shinies are trying to hard to have that extra auditing funding taken away, so the “JCs” will not be "burdened’ with “job killing” taxes.
/sarcasm

Steve

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