The Impact of Funding on IRS Compliance and Enforcement

A year ago, the tax world was pleasantly surprised when Congress granted the chronically underfunded IRS an $80 billion windfall in the Inflation Reduction Act. Now that surprise is turning into dismay among some as Congress starts to claw back that money bit by bit.

President Joe Biden agreed to reallocate about a quarter of that funding as a part of this spring's debt ceiling deal. And now Republican appropriators on Capitol Hill are proposing to take away even more of the money.

On the first part of a two-part podcast series looking at Congress as it returns from its August recess, we sort out what this means with Janet Holtzblatt, a senior fellow at the Urban-Brookings Tax Policy Center and former unit chief for tax policy studies at the Congressional Budget Office.

She spoke with Bloomberg Tax reporter Chris Cioffi about just how much the IRS could lose through this year's appropriations process and about what that would mean for the agency's grand modernization plans.

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