Treasury Urges Congress to Unfreeze IRS Funds

The U.S. Treasury is urging Congress to unlock $20 billion in IRS enforcement funds frozen due to a legislative anomaly in a stopgap funding law. This issue stems from a duplication of a previous $20 billion cut, part of a broader GOP effort to scale back IRS funding, which has already impacted the agency's ability to hire and enforce tax laws. Treasury Deputy Secretary Wally Adeyemo warns that without these funds, there could be 6,000 fewer audits of wealthy individuals and 2,000 fewer audits of large corporations, potentially increasing the national deficit by $140 billion. The Biden administration is seeking to resolve this in upcoming budget negotiations, emphasizing the importance of these funds to modernize IRS operations and improve taxpayer services. The situation is critical as inflation has raised government borrowing costs, and the federal debt has reached approximately $36 trillion. With Republicans poised to take control of the government, the future of IRS funding remains uncertain.