IRS Beefing Up for a Busy 2013
Does the idea of an even bigger, better funded IRS sound good to you? If so… you’re in luck. Earlier this year AccountingToday.com reported that the IRS has requested an even larger budget for 2013:
The Obama administration has increased its budget request for the Internal Revenue Service for fiscal year 2013 to approximately $12.8 billion to make up for recent budget cuts.
The $12.8 billion represents an 8 percent increase of approximately $944.5 million over the level enacted in fiscal year 2012, but only a 5.3 percent, or $639.3 million, increase from the level enacted for fiscal year 2011.
A significant part of the increase from fiscal 2012 stems from the administration’s request to restore lost revenue resulting from reductions in IRS funding made over the past two years. The request is designed to provide the resources necessary to administer and enforce the current Tax Code, implement recent changes to the law to update the Code, and serve American taxpayers in a timely manner.
In fiscal 2011, the IRS collected $2.415 trillion in taxes, representing 92 percent of federal government receipts. The IRS processed more than 144.7 million individual returns during the 2011 filing season and issued almost 110 million refunds totaling $345 billion, the agency pointed out.
In fiscal year 2013, the IRS expects to identify nearly $71 million in cost savings from increased use of electronic return filing, reductions in non-case related travel, and the streamlining of operations.
The fiscal 2013 budget includes $403 million for new IRS enforcement activities, which are expected to raise $1.48 billion in revenue annually at full performance, once new hires are fully trained and develop broader experience by fiscal 2015, representing a 4.3-to-1 return on investment.
“The return on investment is even greater when factoring in the deterrence value of these investments and other IRS enforcement programs, which is conservatively estimated to be at least three times the direct revenue impact,” said the IRS.
This might not sound like a bad thing until you realize that increased “enforcement” means more audits and more onerous paperwork, and that when the agency speaks of a “revenue increase” they are talking about taking more of our tax dollars.
In short, the IRS is going to be bigger than ever in 2013, and more aggressive. This is clearly bad news for business owners and taxpayers who are working hard to earn a living in this troubled economy.
However, should you run into trouble with the IRS, keep in mind that you DON’T have to fight your battle alone. We can help. We’ll get the IRS off your back so you can get back to enjoying your life!