March 28, 2024

Taxpayers suffer when IRS misplaces priorities

Get ready for the credibility gap to vault north between the IRS and the taxpaying public. Right before tax season kicks into high gear, the National Taxpayer Advocate issued a scathing report that exposed the tax collection agency’s misguided strategy to manage its core mission.

Just as the IRS saddles up to process around 150 million individual federal tax returns, the report suggests taxpayers, especially those who are in need of assistance, may be in for a rough ride this season.

The IRS commissioner boldly forecast that of the 100 million calls the agency expects to receive during tax season, fewer than half would reach a customer service representative.

There’s nothing like lowering the bar of expectations to rally the troops before the biggest event of the year. While it’s true the IRS likely would never achieve 100 percent customer satisfaction, the agency’s defeatist culture and lamentable mismanagement arguably prevents the agency from restoring public trust, improving voluntary compliance and narrowing the tax gap.

So instead of restructuring resources to strengthen customer service, the IRSplows stubbornly ahead, recycling a favorite excuse that will be used by Big Spenders from now until the end of time. It says budget cuts have forced the agency to cut back on essential services and functions, including information technology, enforcement and the most basic tax return assistance.

Let’s be clear. The IRS received a hefty 64 percent budget increase from 1997 to 2012. As the federal debt climbs to infinity and beyond, now exceeding $18 trillion, the IRS needs to understand that resources are scarce. And if the IRS is looking to assign blame, let’s look in the mirror a moment. Some overdue self-reflection will show the IRS that its track record over the last year or so has prompted Congress to tighten the purse strings a bit. That doesn’t mean the agency’s belt-tightening must come at the expense of basic customer services, from processing refunds to answering the phones.

In case you missed it, let’s review a few places where the IRS has made a mess.

From targeting taxpayers based on their political views and mishandling federal recordkeeping protocols, the agency’s missteps have undercut confidence in the IRS.

Just as taxpayers are expected to comply fair and square with the federal tax code, taxpayers have every reason to expect the IRS will function with integrity and competence. Politicizing the IRS risks harming our system of voluntary compliance, corrupting effective enforcement of federal tax laws and undermining the financing of public works and services.

The agency needs effective leadership to shake up a bureaucracy mired in mismanagement. No doubt, it’s a tough assignment. The complex tax code is burdensome enough, notwithstanding the additional complications tacked on by the Affordable Care Act and troubled efforts to shut down identity fraud.

Last summer the IRS tacked up a list of taxpayer rights that it says will “renew the focus on” protecting the rights of taxpayers. The list includes the right to be informed; to receive quality service; to pay no more than the correct amount; to challenge the IRS’ position; to be eligible for an impartial appeal; to know when an audit is final; to expect due process rights; to have tax matters treated confidentially; to retain representation; and to receive a fair and just tax system.

And yet, the IRS isn’t exactly blazing trails to satisfy its customers. Tellingly, the IRS prioritizes resources when it comes to union activities, employee bonuses and lavish conferences. The recent report by the National Taxpayer Advocate and comments by the IRS commissioner instead suggest an underwhelming commitment to taxpayer rights.

As a longstanding taxpayer watchdog, I’ll continue to keep the IRS on a short leash through robust oversight and legislative reforms. Building from bipartisan taxpayer rights laws enacted in 1988 and 1996, I am drafting new legislation with Sen. John Thune of South Dakota to strengthen several provisions, including those to root out misconduct and abuses of taxpayer rights by IRS agents and others.

Among other measures, my legislation would target unauthorized collection practices, improve tax administration, strengthen taxpayer protections and shield private taxpayer information.

Putting the brakes on scofflaws within the IRS will help steer the agency toward a culture of integrity, service and accountability.

Using the IRS as a political tool not only violates federal laws, but it also goes against the American grain. Stonewalling congressional oversight, politicizing the administration of tax laws and blaming budget woes as a scapegoat for bailing out on taxpayer service flunks any measurement of managing the people’s business.

Throwing a bone to taxpayer rights may look good posted on the IRS website. But a skeletal commitment to taxpayer rights misses the mark. Good government requires good services. The new Congress will not let the IRS off the hook for misplacing its priorities. From my leadership position in the U.S. Senate, I am working to put more meat on the bone that will beef up taxpayer and whistleblower rights so the people’s business comes first.