IRS Unveils Spending Plan for $80 Billion Funding Boost

The Internal Revenue Service on Thursday unveiled its long-awaited spending plan for a controversial $80 billion cash infusion, pledging to hire thousands of new workers to audit wealthy Americans and big corporations.

The roadmap provides new details about how the tax-collecting agency will use the money over the next decade, including plans to modernize technology, improve customer service, deliver real-time alerts, provide “world-class” customer service and crack down on the so-called tax gap by enhancing enforcement of the wealthy.

The Treasury Department previously said the funding boost would allow the IRS to hire about 87,000 workers over the next 10 years, doubling the agency’s staff. However, the operating plan did not provide an estimate for the agency’s hiring plans beyond the next few years.

The IRS – which had about 78,700 employees as of 2021 – said that it plans to hire nearly 30,000 new employees by the end of fiscal year 2025, including 8,782 hires in enforcement and 13,883 in taxpayer services. The new enforcement employees will be “exclusively” focused on high-earning households, larger partnerships and companies, according to IRS Commission Danny Werfel.

The influx of money for the IRS over the next decade was included in the Democrats’ health care and climate change spending bill – dubbed the Inflation Reduction Act – that President Biden signed into law in August 2022. The funding is aimed at improving tax compliance among big corporations and wealthy Americans and shrinking the estimated $600 billion tax gap.