For months, IRS Commissioner John Koskinen and the agency's defenders have warned that taxpayers "would suffer longer waits on the phone, receive less help from the agency, and experience a delay in refunds because of the budget cuts Congress passed — cuts that came after years of IRS budget increases,"
The Washington Examiner observed Monday.
Last May, for example, the agency said in a report that without "additional customer service funding," nearly every other call "will not be answered in 2015 due to projected increases in demand anticipated by the Affordable Care Act."
But according to a
scathing new report issued by the House Ways and Means Committee's Republican majority staff, many of the hardships visited upon the American people resulted from poor decision-making by the IRS itself.
The report issued last week notes that the IRS collects an estimated $400 million to $500 million worth of user fees annually which it may allocate for its own operations.
But instead of devoting the funds to improvements in customer service (where user fees are traditionally allocated), the IRS spent much of it for lower-priority matters, including $60 million for employee bonus checks and more than $23 million on activities by the agency's employee union.
In addition, the IRS squandered millions of dollars on training videos "that contained little or no educational content," including $60,000 for one video parodying "Star Trek."
Questionable agency decisions on allocating the user fees resulted in cuts to customer service. In fiscal 2014, the IRS spent $183 million in user fees on taxpayer services — just 44 percent of the user fee account.
But in fiscal 2015, "the IRS plans to spend only $49 million on customer service, or 10 percent of the user-fee account," the report said. "This decision amounts to a 73 percent reduction in user fees allocated to customer service, and a 6 percent decrease in total funding for taxpayer assistance."
For the 2015 filing season, the IRS estimated that it would receive 48.8 million calls seeking live assistance but would only answer 16.8 million — slightly more than one of every three — leaving 32 million taxpayer calls unanswered.
Moreover, spending decisions "entirely under the IRS' control led to 16 million fewer taxpayers receiving IRS assistance this filing season," said the report. "Other spending choices, including prioritizing employee bonuses and union activity on the taxpayers' dime, used up resources that otherwise could have been used to assist another 10 million taxpayers."
The IRS' spending decisions "and mismanagement of resources raise serious questions about the nature and extent of the agency's self-described budget crisis and its commitment to serving the taxpayer," according to the staff report.
Koskinen, the report continues, noted that the effect of IRS' budget allocations "will hurt taxpayers"; described IRS customer service for the 2015 filing season as " abysmal"; and called cuts to his agency's budget "a tax cut for tax cheats."
For fiscal 2015, the IRS "has said publicly it will conduct 46,000 fewer audits." IRS enforcement agents in Dallas, Texas, said "they would not audit anyone who owed less than $1 million in taxes."
According to the "supervisory revenue officer" for Dallas, if a person owed $900,000, "I have to say, 'sorry, we can't get that money.'"
The reasoning behind these public announcements is "hard to understand," the Ways and Means report said. "It is like a sheriff announcing that anyone driving under 85 miles per hour would not be pulled over."
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