$8.64 Billion to be Obligated in 2023 and 2024
The IRS revealed in its Strategic Operating Plan that about $8.64 billion of the new funding will be obligated during the 2023 and 2024 fiscal years. During this time, 8,782 new hires will be enforcement staff.
Data Scientists to Complement Traditional Tax Staff
U.S. Deputy Treasury Secretary Wally Adeyemo highlighted that the IRS plans to hire more data scientists than ever for enforcement purposes. These professionals will work alongside traditional tax attorneys and revenue agents, using new data analytics technology to identify audit targets.
13,883 Customer Service Hires Over Two Years
In addition to enforcement staff, the IRS plans to hire 13,883 full-time-equivalent customer service staff over two years. This includes the 5,000 new taxpayer services employees hired recently to answer phones, reopen taxpayer assistance centers, and process tax returns.
Addressing Employee Retirement and Replacements
According to a U.S. Treasury official, the new hires will help offset the nearly 12,000 IRS employees expected to retire over the next two years, including over 4,700 enforcement staff.
Closing the Tax Gap and Upgrading Technology
The $80 billion in new funding, sourced from the climate-focused Inflation Reduction Act, aims to close the "tax gap" between taxes owed and paid, which the Treasury estimates to be around $600 billion annually. The focus will be on auditing the wealthiest Americans. Additionally, the Investment will help modernize the agency's outdated computer technology.
New Revenue Expected to Fund Inflation Reduction Act
The Congressional Budget Office estimates that the new funding will generate roughly $204 billion in new revenue over the next decade, which will help pay for the Inflation Reduction Act investments. The Treasury's estimates are as high as $400 billion over the same period.
IRS Commissioner Discusses Future Plans
New IRS Commissioner Danny Werfel informed reporters that the agency would soon provide hiring and spending plans for the 2025 fiscal year, with ongoing updates to the operating plan. The IRS's ability to deploy new technology for automation will play a significant role in determining future staffing needs.