The IRS may see an additional $1 billion in funding to improve taxpayer service and technology, as well as make the tax system in general, fairer. A draft of the House Appropriations Committee’s 2023 Financial Services and General Government funding bill was released which outlines annual funding for various agencies, including, but not limited to the Treasury Department, the Small Business Administration, and the Executive Office of the President.
Bill Breakdown
The bill provides a $1.3 billion increase from the fiscal year 2022, which totals out to $15.6 billion in discretionary appropriations for the Treasury Department in FY 2023. Of the money to be distributed, the IRS will be receiving $13.6 billion, which is a $1 billion increase from the fiscal year 2022. The increased funding is supposed to be directly allocated towards improving customer service, enforcing fairness in the tax system, and modernizing the IRS systems.
Specific Spending:
In terms of customer service, the budget will increase by $630 million from last year. This extra funding is purposed to support the Volunteer Income Tax Assistance Matching Grants Program, Low Income Taxpayer Clinic, the Taxpayer Advocate, Tax Counseling for the Elderly, and more employees to improve IRS customer service.
Additionally, tax enforcement efforts will have $682 million in additional funding. The extra money will be utilized to support current enforcement efforts, as well as hire more essential personnel.
Technology will be improved by the $35 million budget increase. The money will be put directly towards the modernization of business systems, the improvement of the IRS’ web applications, and the tax filing process.
Rosa DeLauro, House Appropriations Committee chair had this to say, “By increasing resources for [the] Internal Revenue Service, we are helping the agency provide better customer service and crack down on big corporations and the wealthy who are not paying their fair share in taxes.”
Wrap Up
Overall, the additional funding to the IRS should help reel in some of the large issues had with the agency over the past few years, however, we do not yet know how successful it will be. This being said, to ensure the money is being spent correctly, the Treasury Inspector General for Tax Administration will also be receiving more funding, in the amount of a $13 million increase.