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Auditing the rich is paying off already

Published on 21 Comments on Auditing the rich is paying off already

Not everyone is happy about the money the IRS got a couple of years ago to beef up its tax enforcement of rich people:

This is a common conservative trope: You've spent all this money and gotten nothing! Its most famous use is that lots of money has been allocated for electric charging stations but only nine have been built. But that project was scheduled from the start to go through 2030. There's nothing wrong with the current construction rate (210 charging ports through Q3 of 2024).

The same kind of thing is true here. Let's go through it:

  1. The original funding level for everything related to the IRS was $80 billion.
  2. Of that, $45 billion was for enforcement.
  3. Republicans have either clawed back or frozen about half of that, so we're down to about $22 billion.
  4. That's for all enforcement. Probably around two thirds is for audits of the rich. That puts us in the neighborhood of $15 billion.
  5. As always, this is over ten years. It's probably somewhat front loaded, so it's most likely around $2 billion per year right now.
  6. So if Jayapal is right about the $4.7 billion number, that's $4.7 billion in return for about $4 billion in spending during the program's first two years.
  7. Needless to say, the intent is to ramp up enforcement over the next decade. These cases can take a lot of time, and the payoff will get bigger and bigger each year.

Griping about $4.7 billion compared to $80 billion is either ignorant or dishonest. Only time will tell how successful this enforcement program is over its lifetime, but right now it's perfectly reasonably on track.

21 thoughts on “Auditing the rich is paying off already”

  5. SC-Dem

    Ultimately the return for audits of the rich will be much larger than whatever is reported. It used to be that the fear of audits resulted in pretty honest tax returns being filed by the rich. Re-instilling that fear should result in far more taxes being paid in the first place than is actually attributed to the audits.

  7. bharshaw

    While fear of audits should get more money out of the rich, the real winners are the accountants and tax lawyers who get paid for devising new ways to get around the rules, or at worst taking cases to the courts.

  11. OldFlyer

    After January , fear of audits on the wealthy will immediately transform into- Fear of audits on the wealthy … who haven’t purchased shares in Truth Social

    Best president money can buy

  12. Joseph Harbin

    "The United States is losing $1 trillion in unpaid taxes every year." That's the assessment of Charles Rettig, a recent IRS commish appointed by Trump, no less.

    It's not likely you'd get all of that, but without extraordinary effort (funding, staffing, persistence), the IRS could probably rake in hundreds of billions more per year. You could fund great programs that make a difference in people's lives with that kind of cash.

    Instead, we're likely to hear more b.s. about out-of-control government spending and the need to cut, cut, cut, cut, cut.

  13. jdubs

    Dishonest and ignorant is an option.

    But the idea that law or rule enforcement must be a profit center is a plague on American society. Bad way to run a business, terrible way to run a country.

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