The House Ways & Means Committee slammed the Internal Revenue Service on Wednesday for “deliberately” cutting $134 million in funding for customer service to pay for employee bonuses and union activity, which lead to 16 million fewer taxpayers receiving IRS assistance in the 2015 filing season.
In its report titled, “Doing Less With Less: IRS’ Spending Decisions Harm Taxpayers,” the tax-writing committee acknowledges that while Congress has chopped the IRS’s budget over the past few years in part due to IRS “waste and misconduct,” the IRS is misallocating its resources away from assisting taxpayers.
But IRS Commissioner John Koskinen countered in his testimony during a Wednesday Ways & Means Oversight Subcommittee hearing on the 2015 tax filing season that taxpayers’ poor customer service experience was directly related to congressional cuts to the IRS’ budget.
Since peaking in 2010, the IRS’ budget has been cut by $1.2 billion, with the “intent” of the cuts designed “to force the IRS to manage its resources more effectively and immediately stop inappropriate activities,” the report says.
The inappropriate activities in question, according to the report, included “extravagant” employee conferences, one of which cost $4.1 million; a “Star Trek” themed training video that cost $60,000 to produce; and the targeting of tea party-aligned groups for extra scrutiny.
However, the GOP-controlled committee’s report states that the IRS made a 73 percent reduction in user fees allocated to customer service, and a 6 percent decrease in total funding for taxpayer assistance, while awarding $60 million in bonuses to its employees “at a time when the IRS did not yet know what its budget would be for fiscal year 2015.”
Further, the report states that the amount of time IRS employees spent on union activity would allow for more than 2 million additional taxpayer-assistance calls.
In his opening statements at the Ways & Means Oversight hearing, Chairman Peter Roskam, R-Ill., said that last year the IRS spent $183 million of its user fees (collected for various IRS services), or 44 percent of the total user fee account, on taxpayer services.
Yet this year, he said, the IRS “only plans to spend $49 million in user fees on taxpayer services. That’s $134 million less than last year, a 73 percent cut.”
If the IRS had used that $134 million to answer calls for assistance, he continued, the money “could have helped 16 million people.”