Barrasso, Crapo, Ernst Expose New Evidence IRS Is Out of Control but What Will They Do About It?

All executive branch departments and agencies exist solely by receiving prior authorization from the First Branch created by the U.S. Constitution. That would be the Congress of the United States. Somebody should remind IRS Commissioner Danny Werfel of this fact.

Three U.S. senators, all Republicans — John Barrasso of Wyoming, Mike Crapo of Idaho, and Joni Ernst of Iowa — are getting a good start on such a reminder. The next question is whether they follow up in a meaningful way following the usual, utterly predictable bureaucratic evasion and double-talk.

Ernst has focused heavily in recent years on drawing public and congressional attention to the lax response of top IRS officials to a growing trend within the federal agency's own workforce of late-filing of tax returns and taxes owed but unpaid.

In the latest edition of an annual assessment of this issue by the Treasury Inspector-General for Tax Administration (TIGTA), which Ernst originally requested, more than 5,800 IRS employees and contractors were found to owe nearly $50 million in unpaid levies.

Among these tax cheats are 3,414 IRS employees, representing 4% of the agency's current 85,359-member workforce. Of those among the 3,415 IRS workers who have agreed to payment plans, $9 million remains unpaid. Employees without a payment plan owe another $12 million.

Contractors, many of whom are former or retired IRS full-time employees, play a major role in performing tasks required for the IRS to fulfill its major duties of tax collection and compliance.

A total of 2,573 of 25,732, or 10%, of the IRS contractors have unpaid taxes. Those without a payment plan owe $17 million, and those with a payment plan have $8 million outstanding.

This problem of federal workers not paying their taxes — whose average pay is more than $106,000 annually, versus just under $60,000 for the individual non-federal worker — is not limited to the IRS. Last year's TIGTA report found more than 149,000 federal workers across the government had unpaid taxes.

And check this out — IRS officials rehired 512 former employees and contractors with outstanding unpaid taxes. And, while federal law requires feds who haven't paid their taxes be fired, the same statute includes a provision allowing the IRS Commissioner to waive the requirement if he or she so chooses.

Turns out, according to the TIGTA report, that Werfel has waived that provision more than 1,000 times. Only 22 such government workers were shown the IRS exit door.

Remember, this is the same IRS for which President Joe Biden sought to add more than 87,000 new investigators, doubling the agency's workforce, purportedly to ensure that rich people pay every penny of what they are obligated. 

But as the House Ways and Means Committee Republicans reported last year, most of the new investigative muscle will result in a massive wave of audits of mostly middle-class earners.

Barrasso and Crapo are zeroing in on the federal tax agency's recently announced Direct File Program (DFP). That's the "service" under which IRS employees take an individual's tax records and prepare their return for them. 

Besides the obvious fact that nobody in their right mind wants to give the tax man the unaccountable authority to decide how much each of us owes the government, Barrasso and Crapo note that Congress has NOT authorized the DFP.

“We write with serious concerns regarding your agency’s recent unilateral and unauthorized action to create a permanent Internal Revenue Service (IRS) Direct File tax preparation program... The American people do not want an all-encompassing IRS acting simultaneously as the tax collector, tax auditor, tax enforcer, and tax preparer,” the senators wrote.

“Taxpayers already have access to numerous free tax-filing options and dozens of national non-profit entities offer tax preparation services at no cost…The IRS does not have unlimited resources and should focus on improving information technology systems, data privacy, and long-standing customer service issues.”

Federal agencies are not allowed simply to create a new program without prior authorization from Congress, which must also provide funding and approve staffing levels.

As Barrasso and Crapo point out, the IRS received permission to study the possibility of establishing such an initiative, not to proceed directly to creating the new program.

"The American people do not want an all-encompassing IRS acting simultaneously as the tax collector, tax auditor, tax enforcer, and tax preparer," the two senators told Werfel in a recent letter.

So the question now is: what will this trio of Republican senators do to follow up on their exposures of IRS maladministration when nothing changes despite their efforts?

In the final analysis, the only way to end unaccountable bureaucratic power-grabbing with certainty is to defund it. Government agencies and bureaucracies are like tigers tied up at dawn. Not long after, they find the maximum length of their tether.

Sooner or later, Republicans and clear-thinking Democrats are either going to man up and start cutting the budgets of agencies like the IRS in response to their power-grabbing, or they should stop complaining about bureaucrats that continually ignore them.