Post Reports The IRS is in turmoil. Taxpayers are taking notice.
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Mar 26, 2025 In this enlightening discussion, Jacob Bogage, Congressional economics correspondent for The Washington Post, delves into the tumultuous state of the IRS as Tax Day approaches. He reveals a staggering predicted shortfall of over $500 billion in tax receipts and explores how the Trump administration’s policies have reshaped taxpayer behavior and agency effectiveness. The conversation also touches on a controversial proposal that would allow the IRS to share taxpayer information with ICE, raising critical concerns about privacy and the implications for undocumented immigrants.
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Significant Drop in Tax Revenue
- The IRS predicts a 10% drop in tax revenue, equaling $500 billion.
- This loss significantly impacts the federal government, comparable to the Defense Department's budget.
Reasons for Tax Revenue Drop
- Tax officials link the revenue drop to Trump's policies and DOGE's actions.
- These include staff layoffs, halting modernization, and removing key IRS officials.
Changing Taxpayer Behavior
- The US tax system relies on voluntary compliance.
- Taxpayers are changing behavior due to reduced enforcement, leading to less compliance.