If you think that Democrats’ tax-and-spending bill wouldn’t expand government, have I got news for you. Believe it or not, the Build Back Better legislation would more than double the size of the IRS.
That’s one of the hidden details in the agreement that Sen. Joe Manchin, D-W.V., cut with Majority Leader Chuck Schumer, D-N.Y., behind closed doors. And of course, Democrats want to ram it through Congress within a matter of days. As House Speaker Nancy Pelosi, D-Calif., once said about another big-government scheme, “we have to pass the bill so that you can find out what is in it.”
Massive Increase in IRS Personnel
The draft bill contains an $80 billion “investment” in the Internal Revenue Service. Of that amount, more than half, or over $45.6 billion, will go towards enforcement activities.
Even as it doles out such vast sums for the IRS, the bill contains only a few short pages of text explaining the provisions. In other words, the IRS will have a relatively wide berth to spend the new funding as it likes.
But last May, the Treasury Department released its “tax compliance agenda,” showing where it would like to spend that money. And on page 17 of that document, it helpfully included a chart demonstrating the IRS agents it would hire with that additional cash. All told, the Biden Administration wants to hire 86,852 agents, expressed in this chart as “FTEs,” or full-time equivalent employees:
By comparison, the most recent version of the IRS’ Data Book shows that in the fiscal year that ended last September 30, the agency had a total of 78,661 full-time equivalent employees. (See Table 32 on page 87 here.) In other words, hiring an additional 86,852 agents would more than double the size of the IRS.
Warning: Government Harassment Ahead
Language on page 39 of the bill states that “nothing in this subsection”—that is, the portion of the bill appropriating the $80 billion for the IRS—“is intended to increase taxes on any taxpayer with a taxable income below $400,000.” A one-page “fact sheet” summarizing the tax provisions makes the same claim.
But, as previously noted, the Biden Administration intends to use the funding in the bill to hire over 86,000 new employees. Does anyone really believe that more than doubling the IRS — the same agency that spent years harassing conservative groups, and still hasn’t explained the public leak of confidential tax return information to the liberal website ProPublica — means that all those new employees will exclusively focus on “the rich,” and won’t spend some or all of their time targeting middle-class and working Americans?
Admittedly, the Treasury Department claimed in its compliance agenda last May that “audit rates will not rise relative to recent years for those with less than $400,000 in actual income.” But the bill itself includes no statutory prohibition on the IRS harassing middle-class taxpayers. It merely says the bill “intends” not to increase their tax burden. It doesn’t prohibit the legislation from having that effect in practice, and it doesn’t prohibit the IRS from burying struggling families in a mountain of new audits and paperwork.
Why Not Audit Biden Instead?
All this focus on IRS “enforcement” comes with a profound irony: Many tax experts, including one from the liberal Tax Policy Center, believe that Joe Biden himself cheated on his 2017 and 2018 taxes, paying himself an absurdly low salary (while using a “loophole” that his Administration now wants to close) to avoid paying hundreds of thousands of dollars in Medicare and Obamacare taxes.
In what will come as a shock to absolutely no one who understands how Washington works, the Democrats who claim to support giving more power to the IRS to audit “the rich” have said precious little about Biden’s tax shenanigans. Of course, if they really believed in the accountability they claim to support, they would be sending letters to the IRS demanding that the Service audit Biden’s 2017 and 2018 returns.
Instead, the principle of “audits for thee, but not for me” rules the Democratic roost. All of which suggests that the 86,852 new IRS agents the Biden Administration wants to hire will end up making life miserable not for “the rich,” but for ordinary Americans, for years to come.