IRS Gets $80B in Additional Funding
The Internal Revenue Service says it needs $80 billion in additional funding to help collect some of the $600 billion left on the table in uncollected taxes every year, but a look at the agency shows why that money might be better spent elsewhere.
The IRS says it needs to hire more people and upgrade its technology, some of which is stuck in the 1960s.
It says it needs to clear the backlog of unprocessed 2021 tax returns, improve customer service by hiring more customer service representatives, overhaul its technology and hire more staff overall, CNBC reported.
But critics are asking important questions about why the IRS needs the money and whether the agency will spend it properly
Tyler Cowen, a professor of economics at George Mason University and a Bloomberg Opinion columnist, recently wrote a column titled “The IRS Has Problems That $80 Billion Won't Solve.”
In it, he notes that the IRS’s cybersecurity software is woefully underwhelming and an essential technology upgrade isn’t slated to finish until 2030.
A Government Accountability Office report on the IRS said the upgrade has been radically scaled back and the agency has also “revised the program’s cost, schedule, and scope goals on numerous occasions, including seven times between 2016 and 2019.”
“That does not inspire much confidence,” Cowen wrote.
The IRS is also using fax machines, “an obsolete version of Windows, and the programming language of COBOL, which was designed in 1959 and standardized in 1968,” he wrote.
Plenty of small to mid-sized businesses and non-profits around the country with smaller staff and budgets have managed to upgrade to better software, he noted.
“These software upgrades are supposed to save money by enhancing productivity, letting organizations do more work with fewer people,” Cowen wrote. “A reasonable person can be forgiven for asking whether an agency with a $13.7 billion budget really doesn’t have enough to front some cash.”
With such poor performance, he suggests asking the IRS to improve its performance without extra money “and after they have shown they can make better progress, give them the money they need to finish the job.”
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