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The IRS is a third world bureaucracy

This is shameful

The right wingers are up in arms over Biden’s “IRS Army” that’s coming to kill you in your beds but the truth is that the agency is in deep trouble from underfunding:

Inside the Internal Revenue Service, which is on the brink of a major funding infusion that Democrats and agency workers say is badly needed to boost efficiency and revenues, staffers describe bringing their own office supplies and working extensive overtime in understaffed divisions.

But outside, in Washington and online, an outcry is building among those who see the IRS as a powerful government entity hostile to taxpayers. Some of those critics are conservatives opposed to ramped-up enforcement. Others are far-right extremists sowing disinformation and calling on citizens to prepare for violence.

The sweeping climate and spending bill House Democrats passed Friday, sending it to President Biden’s desk for his signature, includes $80 billion for the IRS spread out over a decade. In interviews, agency employees say the money can help address bottlenecks, stemming partly from staffing issues, that can add complications for taxpayers and employees alike.

Will Kohler, who works as a tax examiner at the IRS office in Cincinnati, said supply shortages mean he sometimes has to use his own pens and paper clips. He has even brought in paper for the copy machine over his 10 years there, which he says is just part of the job at the chronically paperbound and technologically outdated agency.

Some of the challenges Kohler and fellow staffers recounted are familiar to workers across the economy, who in recent years have been asked to do more with less by employers plagued by labor shortfalls and tight resources.

“I mean, it’s a factory,” said Kohler. “And when there’s been no money and they’ve not been able to hire good people, it’s been bad.”

The IRS, which is overseen by the Treasury Department, has shed about 13% of its staff since 2012. With about 79,000 current employees, its headcount has receded to near-1974 levels, the agency’s director told Congress earlier this year, despite growing revenue and some 14% more taxpayers filing returns in the last 10 years. Over the same period, the IRS’s budget has dropped from $14.3 billion to $13.7 billion in the 2021 fiscal year, or around 15% when adjusted for inflation, according to the agency. 

Staffing in enforcement has fallen even more sharply, by 30% since 2010, even while the tax code — and businesses’ and individuals’ maneuvers to circumvent it — have become more complex.

Natasha Sarin, a counselor for tax policy in the Treasury Department, acknowledged that the IRS has been “a hard place to work over the last decade because of budget cuts and lack of funding,” which she said has dragged down workers’ efficiency.

Echoing Kohler’s experience, she said “people have had to buy staplers, buy red pens, buy Band-Aids that come from having to deal with so much paper-processing.”

The proposed funding, which would let IRS hire some 87,000 people over the next decade, should help, employees said. That number includes replacing some 52,000 employees who are expected to leave or retire in coming years, as the workforce has aged amid budget declines. That could bring overall staffing up to more than 110,000, a level not seen since the mid-1990s. Returns, meanwhile, have been growing, from 118 million individuals in 1995 to 168 million last year.

The IRS says it will use the resources to put more focus on high net-worth individuals and businesses, with Director Charles P. Rettig, a Trump-appointee, telling Congress recently that enforcement would heed a Treasury directive not to raise audit rates for households making less than $400,000 a year.

[…]

Amy Hanauer, the executive director for the Institute on Taxation and Economic Policy, which supports efforts to recoup more tax revenue from big companies and high earners, voiced optimism about the planned funding. “My hope is that this will begin to restore trust from Americans that our tax system is fairer than it was — that corporations aren’t being allowed to pay no taxes,” she said.

In the meantime, IRS staffing shortages can make it hard for existing employees to get their jobs done. Lorie Y. McCann, a senior program analyst in Chicago and the president of the local National Treasury Employees Union chapter, said more than 90% of the complaints she hears from colleagues are related to understaffing.

“There’s not one division in the agency that doesn’t have issues with understaffing at this point,” said McCann, who has been at the IRS for 31 years. “When your co-workers have retired or resigned, the work doesn’t go away.”

Steven Eldridge, 30, a technician in Austin who has worked at the IRS for two years, said his supervisors have been offering workers as many as 76 hours of overtime every two weeks to help with backlogs.

He effectively works two jobs: His main responsibility is helping resolve errors on tax returns, an often cumbersome process of reconciling paper forms with the agency’s outdated computing system. But he also works as an “OJI” — an on-the-job instructor, training and helping new hires get up to speed with the agency’s programs.

The instructing needs now take up the bulk of his time, as the agency works to plug gaps from attrition with new hires. So Eldridge has been working long weeks — 65 hours last week, 70 hours this week — to keep up.

Like many employers grappling with a tight labor market, the IRS has been struggling to bring in and hold on to new staffers. The average agent makes about $62,000 a year, according to jobs site ZipRecruiter, but the most popular role — phone reps the IRS says it’s hungry to hire as call service has suffered — makes less than that on average.

The pay range for phone reps is about $40,000 to $55,000 a year, with some variation, in expensive cities like New York, Oakland, Washington and Denver, according to federal data.

An human resources specialist in Kansas City whose focus has been hiring for the phone lines, said that turnover remains a major problem, largely because the pay has fallen behind rising wages in the private sector.

“It’s not so much that hiring is the problem,” he said, “but retaining the people we have.”

Nobody likes paying taxes but to turn the tax collection agency into a 19th century Dickensian organization is ridiculous.

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