President Trump’s fiscal 2021 budget plan proposes $12 billion in funding for the Internal Revenue Service (IRS), up from the $11.5 billion allocated to the agency in the fiscal 2020 government funding bill the president signed in December.
The proposed budget increase is intended to allow the IRS to “modernize its systems to improve taxpayer service and enforcement” and carry out other reforms mandated in an IRS-improvement bill enacted last year. The IRS is required to send Congress a reorganization plan by Sept. 30.
“The budget allows Treasury to continue implementing the Tax Cuts and Jobs Act, which has unleashed the U.S. economy and is benefiting American workers, families, and businesses,” Treasury Secretary Steven Mnuchin said. “It also funds the IRS to modernize its systems to improve taxpayer service and enforcement, to implement the bipartisan Taxpayer First Act, and proposes an investment in enforcement funded through a program integrity cap adjustment which will save the American taxpayer $64 billion over the next ten years.”
Senate Finance Committee ranking member Ron Wyden (D-OR) said this week that the IRS needs to rethink its enforcement role. “We still have a long way to go in terms of tax enforcement when we have seen tax enforcement, so often in the past, focused on vulnerable folks and giving a free ride to the wealthiest,” Wyden told Bloomberg BNA.