Please ensure Javascript is enabled for purposes of website accessibility
AP FACT CHECK: GOP Skews Budget Bill’s Impact on IRS, Taxes
News
By News
Published 3 years ago on
August 10, 2022

Share

 

Republican politicians and candidates are distorting how a major economic bill passed over the weekend by the Senate would reform the IRS and affect taxes for the middle class.

The “ Inflation Reduction Act,” which awaits a House vote after passing in the Senate on Sunday, would increase the ranks of the IRS, but it would not create a mob of armed auditors looking to harass middle-class taxpayers, as some Republicans are claiming.

While experts say corporate tax increases could indirectly burden people in the middle class, claims that they will face higher taxes are not supported by what is in the legislation.

A look at some of the claims about $740 billion package that emerged from a deal negotiated by Senate Majority Leader Chuck Schumer, D-N.Y., and Sen. Joe Manchin, D-W.Va.:

HOUSE MINORITY LEADER KEVIN MCCARTHY, R-CALIF.: “Do you make $75,000 or less? Democrats’ new army of 87,000 IRS agents will be coming for you — with 710,000 new audits for Americans who earn less than $75k.” – tweet Tuesday.

SEN. TED CRUZ, R-TEXAS: “The Manchin-Schumer bill will create 87,000 new IRS agents to target regular, everyday Americans.” — Friday tweet.

THE FACTS: That’s misleading. Last year, before the bill emerged, the Treasury Department had proposed a plan to hire roughly that many IRS employees over the next decade if it got the money. The IRS will be releasing final numbers for its hiring plans in the coming months, according to a Treasury official. But those employees will not all be hired at the same time, they will not all be auditors and many will be replacing employees who are expected to quit or retire, experts and officials say.

The IRS currently has about 80,000 employees, including clerical workers, customer service representatives, enforcement officials, and others. The agency has lost roughly 50,000 employees over the past five years due to attrition, according to the IRS. More than half of IRS employees who work in enforcement are currently eligible for retirement, said Natasha Sarin, the Treasury Department’s counselor for tax policy and implementation.

Budget cuts, mostly demanded by Republicans, have also diminished the ranks of enforcement staff, which fell roughly 30% since 2010 despite the fact that the filing population has increased. The IRS-related money in the Inflation Reduction Act is intended to boost efforts against high-end tax evasion, Sarin said.

The nearly $80 billion for the IRS in the bill will also pay for other improvements, such as revamping the agency’s technology, said Janet Holtzblatt, a senior fellow at the Tax Policy Center and former Treasury official.

The Treasury says it will hire experienced auditors and workers who will improve taxpayer services, and that audit rates for those earning less than $400,000 are not expected to rise in relation to historic norms.

So that’s a long way from hiring 87,000 “agents” to go after average people in the United States, as the GOP claims have it. In any case, the bill has no mandate to hire that many people.

___

REP. TROY NEHLS, R-TEXAS: “Americans asked for lower inflation and the Democrats gave us an armed IRS shadow army to spy on your bank accounts.” — Sunday tweet.

REP. MARJORIE TAYLOR GREENE. R-Ga.: “It’s going to hire 87,000 new IRS agents and it’s going to arm — as in guns, you know, Democrats are always upset about guns — 70,000 of these IRS agents.” — at the Conservative Political Action Conference, in an interview with the conservative Canadian news magazine The Post Millennial.

THE FACTS: That’s false. The bill will not create any such army, officials and experts say. Only some IRS employees who work on criminal investigations carry firearms as part of their work.

A division of the IRS called criminal investigation serves as the agency’s law enforcement branch. Its agents, who work on issues such as seizing illicit crypto currency and Russian oligarchs’ assets, carry weapons, Sarin said.

There were just more than 2,000 such special agents working at the IRS in 2021, according to agency documents. The branch will get money from the Inflation Reduction Act, but the bulk of the dollars will go toward other areas, according to Sarin.

The bill does not designate money specifically for a large number of armed IRS employees.

___

NEVADA SENATE CANDIDATE ADAM LAXALT, criticizing his opponent, Democrat Sen. Catherine Cortez Masto: “.@CortezMasto just voted to raise taxes for Nevadans making as low as $30k/year.” — Sunday tweet.

THE FACTS: Nothing in the bill raises taxes on people earning less than $400,000, contrary to Laxalt’s claims. There are no individual tax rate increases for anyone in the bill, experts say.

It’s possible, though, that the bill’s new corporate taxes, including a minimum 15% tax for large corporations, could cause indirect economic impacts. A report from the Joint Committee on Taxation said some people who make less than $400,000 might see such impacts.

“Economists are generally in agreement that the corporate income tax is borne not just by the businesses, but also by shareholders and by workers,” Holtzblatt said. “So that tax that gets imposed on the corporation, some of that might end up getting shifted to workers in the form of lower wages.”

Added Garrett Watson, a senior policy analyst at the Tax Foundation: “Distinguishing between whether lower after-tax incomes happen because of a direct tax hike or indirect incidence may be a distinction without a difference for many households.”

Nevertheless, supporters of the bill did not vote for tax increases on people earning $30,000, as Laxalt claimed.

RELATED TOPICS:

DON'T MISS

What Are Fresno Real Estate Experts Predicting for 2025 and Beyond?

DON'T MISS

First California EV Mandates Hit Automakers This Year. Most Are Not Even Close

DON'T MISS

The TikTok Effect: Viral Videos Create the Next Travel Hotspots

DON'T MISS

‘The Studio’ Knows the Real Reason Movies Are Bad

DON'T MISS

US-China Tariff Talks to Continue Sunday, an Official Tells The Associated Press

DON'T MISS

Has America Given Up on Children’s Learning?

DON'T MISS

Could Trump Team Suspend Habeas Corpus to Expedite Deportations?

DON'T MISS

Two Teens Charged in Shooting Death of Caleb Quick

DON'T MISS

India and Pakistan Agree to a Ceasefire After Their Worst Military Escalation in Decades

DON'T MISS

Ukraine and Allies Urge Putin to Commit to a 30-Day Ceasefire or Face New Sanctions

DON'T MISS

Soviet-Era Spacecraft Plunges to Earth After 53 Years Stuck in Orbit

DON'T MISS

Tax the Rich? Slash Spending? Republicans Wrestle With Economic Priorities in the Trump Era

UP NEXT

Has America Given Up on Children’s Learning?

UP NEXT

Could Trump Team Suspend Habeas Corpus to Expedite Deportations?

UP NEXT

India and Pakistan Agree to a Ceasefire After Their Worst Military Escalation in Decades

UP NEXT

Ukraine and Allies Urge Putin to Commit to a 30-Day Ceasefire or Face New Sanctions

UP NEXT

Tax the Rich? Slash Spending? Republicans Wrestle With Economic Priorities in the Trump Era

UP NEXT

Experts Call Kennedy’s Plan to find Autism’s Cause Unrealistic

UP NEXT

Trump’s Trip to Saudi Arabia Raises the Prospect of US Nuclear Cooperation With the Kingdom

UP NEXT

Tariff Talks Begin Between US and Chinese Officials in Geneva

UP NEXT

US Military Ordered to Pull Books on Diversity, Gender Issues

UP NEXT

Mayor Baraka of Newark, New Jersey, Arrested at ICE Detention Center He Has Been Protesting

Has America Given Up on Children’s Learning?

2 days ago

Could Trump Team Suspend Habeas Corpus to Expedite Deportations?

2 days ago

Two Teens Charged in Shooting Death of Caleb Quick

2 days ago

India and Pakistan Agree to a Ceasefire After Their Worst Military Escalation in Decades

2 days ago

Ukraine and Allies Urge Putin to Commit to a 30-Day Ceasefire or Face New Sanctions

2 days ago

Soviet-Era Spacecraft Plunges to Earth After 53 Years Stuck in Orbit

2 days ago

Tax the Rich? Slash Spending? Republicans Wrestle With Economic Priorities in the Trump Era

2 days ago

Israeli Airstrikes Kill 23 in Gaza as Outcry Over Aid Blockade Grows

2 days ago

Experts Call Kennedy’s Plan to find Autism’s Cause Unrealistic

2 days ago

Trump’s Trip to Saudi Arabia Raises the Prospect of US Nuclear Cooperation With the Kingdom

2 days ago

The TikTok Effect: Viral Videos Create the Next Travel Hotspots

A recent study from TripIt and Edelman Data & Intelligence discovered 69% of millennials and Gen Z use social media to find inspiration ...

23 hours ago

23 hours ago

The TikTok Effect: Viral Videos Create the Next Travel Hotspots

23 hours ago

‘The Studio’ Knows the Real Reason Movies Are Bad

2 days ago

US-China Tariff Talks to Continue Sunday, an Official Tells The Associated Press

2 days ago

Has America Given Up on Children’s Learning?

2 days ago

Could Trump Team Suspend Habeas Corpus to Expedite Deportations?

The Clovis Police Department identified two suspects they have arrested in connection with the murder of Caleb Quick, 18, at a Saturday, May 10, 2025, news conference. (GV Wire Composite)
2 days ago

Two Teens Charged in Shooting Death of Caleb Quick

2 days ago

India and Pakistan Agree to a Ceasefire After Their Worst Military Escalation in Decades

2 days ago

Ukraine and Allies Urge Putin to Commit to a 30-Day Ceasefire or Face New Sanctions

Help continue the work that gets you the news that matters most.

Search

Send this to a friend