IRS Expansion Raises Concerns of Politicized Tax Agency

Tax Attorneys Discuss Possible Link Between The IRS And Political Agendas

Some Democratic leaders are now pushing for a $5.2 billion increase to the IRS for expanding its enforcement activities – an increase that, on the surface, should be met with approval, but that conservatives fear is indicative of a return to politicized policies regarding who faces tax enforcement and who does not.

GOP members fear that under the Biden administration, the tax agency will become politicized, as it did during the Obama administration, when Biden was vice president. In 2013, the Office of Treasury Inspector General for Tax Administration issued a report that said that the IRS used “inappropriate criteria” for review applications from organizations such as the Tea Party and other conservative groups.

After an investigation, the Senate Finance Committee released a report in 2015 that showed that the director of the IRS Exempt Organizations Unit would subject these organizations to extra layers of scrutiny, requiring them to provide more documentation, as well as leaving their applications untended for as much as two years. The intent was to stall their efforts to fundraise and to grow their organizations.
A final ruling showed that no criminal conduct took place, but the IRS made a “sincere apology” for the behavior, and the government agreed to a $3.5 million settlement with several of the affected groups.

In the latest move, 25 House Democrats have signed a letter asking for $12.1 billion for the IRS, with $5.2 billion specifically for enforcement activities. “critical to ensuring compliance.”
Though the letter does not include any information indicating a specific group or goal for the enforcement activities, conservatives are concerned about the timing of the request. They note that House Democrats have not been interested in increasing such activities under the Trump administration. They have only renewed this interest with the election of Joe Biden – whose previous administration showed such targeted efforts.

Can The IRS’s Enforcement’s ROI Increase The Federal Revenues?

House Democrats said the increase was needed as a matter of “tax fairness.” The letter says that a $20 billion increase of enforcement efforts over 10 years would result in increased revenues of $6.1. If $40 billion in enforcement efforts is invested over 10 years, the letter says it would result in increased revenues of $103 billion.

It will be some time before any action is taken on this proposal, and even more time before it is known whether the IRS enforcement efforts become politicized as they did in the past.

If you feel that you are unfairly targeted in your audit or in other IRS enforcement efforts, you should contact a qualified tax attorney as soon as possible. Silver Law PLC is ready to help. Our tax attorneys all have experienced working with the IRS, and they understand how these cases are prosecuted, as well as the ins and outs of tax law. They understand how to protect your rights and prevent unfair prosecution. Call us if you are facing an audit, civil or criminal tax litigation, or other action from the IRS.

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