BILLIONS IN LOST REVENUE FROM BUSINESSES
Billions in lost revenue from businesses. The debate goes back and forth. Should businesses be given a tax cut to spur economic growth in times of slow growth, to only swell the deficit, and are the benefits of increased growth worth the risk of dealing with the debt down the road. The same argument happened during the Reagan Administration when tax cuts improved the economy, but increased the deficit. It has happened multiple times since, and each time our deficit has grown, but so has the overall size of the economy. Billions in lost revenue from businesses.
A series of budget cuts at the Internal Revenue Service has led to an estimated $34.3 billion in lost revenue from large companies, according to a new study. New research from the Indiana University Kelley School of Business backs up previous statistics indicating that the IRS is auditing fewer tax returns from corporations because it has fewer people and resources available to identify potential errors and follow up on questionable tax returns. However, the researchers say this is the first study to actually quantify the amount of corporate tax revenue lost during the audit process per dollar of IRS budget cuts. BIllions in lost revenue from businesses.
In recent years, especially since the passage of the Tax Cuts and Jobs Act at the end of 2017, Congress has appropriated more funding for the IRS to implement the new tax law, as well as deal with issues such as taxpayer identity theft, taxpayer service and computer modernization. However, relatively little funding has been designated for increasing IRS tax audits, even though audits and examinations more than pay for themselves. When adjusted for inflation, the 2019 IRS budget of $11.3 billion is less than in 2000 and 19 percent beneath its highest level of funding in 2010, according to the Government Accountability Office. The agency now has 21 percent fewer employees than it did eight years ago. Meanwhile, the number of examiners has declined by 38 percent since 2010.
What is not told by the Accountability Office is that the IRS has gone on a spending spree since the fall of 2018, due to generous Congressional funding, to swell the ranks of its members. The Congress in its wisdom, finally realized that the IRS brings in multiple dollars for every dollar Congress affords it. Audits on actually on the way back up. If you have been contacted by the IRS and have a tax debt or unfiled tax returns, this Tax Resolution Company can help you determine your Tax Relief options in the Internal Revenue Code. For 35 years we have provided Tax Resolution Services for those who want to explore options for dealing with tax debts, including the IRS Fresh Start Program and other Tax Relief options.