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During a House Ways and Means Committee session, Rep. John B. Larson questioned IRS Commissioner Danny Werfel about the impact of the Inflation Reduction Act’s additional funding gained by Democrats, focusing on improvements in customer service and holding wealthy tax evaders accountable. Werfel warned that any reduction in this funding, as proposed by Republicans, would negatively affect taxpayers and hinder IRS operations. The Inflation Reduction Act has already resulted in heightened services like a 95% callback option for live assistance callers, expanded in-person services, an online portal for small businesses to file Form 1099 returns, and recovering over $500 million from around 1,600 wealthy tax evaders.
Democratic Funding and the IRS: Implications Discussed in House Ways and Means Committee
At a recent House Ways and Means Committee session, Rep. John B. Larson (CT-01) questioned IRS Commissioner Danny Werfel regarding the impact of additional funding from the Inflation Reduction Act. The discussion highlighted how the funding could improve customer service and strengthen measures against affluent tax evasion. Concerns were also raised about the potential harm of Republican-backed IRS budget cuts.
Larson highlighted concerns about budget cuts on IRS operations, particularly in light of the federal deficit. Commissioner Werfel stressed how such cuts would adversely affect taxpayers, hampering the IRS’s capacity to provide crucial services, leading to increased taxpayer stress and uncertainty.
The Inflation Reduction Act already produced palpable results, with evident service enhancements during the current filing season. These include customer callback options for most callers, expanded in-person services, an online portal for small businesses to file Form 1099 returns, and recovery of over $500 million from wealthy tax evaders.
Despite these improvements, House Republicans proposed IRS funding cuts, which could drastically reduce taxpayer services and hinder measures against tax evasion. These reductions could constrain the IRS’s ability to assist taxpayers and effectively pursue wealthy tax fraudsters.
The Inflation Reduction Act has brought significant improvements to IRS services, favoring taxpayers and reinforcing tax enforcement accountability. However, the threat of funding cuts jeopardizes these advancements, emphasizing the necessity for continued IRS funding support for effective tax administration and taxpayer rights protection.
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