IRS Failed to Hold Tax-Evading Employees Accountable, Report Finds
Story by Chris Kissell, Money Talks News, 8/12/24
The IRS recently made a big splash by announcing it had collected more than $1 billion from rich taxpayers who previously had not paid their fair share. But a new report shows that some workers inside the agency also have failed to live up to their obligations to the government.
Thousands of IRS employees collectively owe roughly $46 million in overdue taxes, according to a report by the U.S. Treasury Inspector General for Tax Administration (TIGTA), an independent federal agency that oversees the IRS.
The report found that overall, 95% of IRS and contractor employees had both filed and paid their taxes on time as of May 2023. However, others were not so diligent.
The report states that among IRS employees, 3,323 (4%) had not fully paid the balances due on their federal tax returns. Of these, 2,044 were not on an IRS payment plan, and the other 1,279 were on one.
IRS payment plans are installment agreements for taxpayers who are unable to pay their tax bills in full on time. According to the report, they also serve to “educate the taxpayer on ways to avoid future tax delinquencies while paying off their balances due and ensuring that they fulfill their tax compliance responsibilities.”
Among contractor employees, 2,484 (10%) had overdue taxes. Of these, 1,729 were not on an installment agreement, and 755 were.
Looking at the numbers, it is clear that a majority of those who were not compliant were not on installment agreements.
U.S. Sen. Joni Ernst (R-Iowa) — who commissioned the TIGTA report — says in a press release that despite the fact that the IRS has the power to terminate employees who willfully fail to pay taxes, the agency fired just 20 such workers between October 2021 and April 2023.
In addition, the IRS later rehired some employees and contractors who previously had not complied with their tax obligations, according to the report.
In a press release, Ernst says:
“While the IRS warns, ‘tax evasion is a serious crime punishable by imprisonment, fines, and the imposition of civil penalties,’ the agency is rewarding its own tax dodgers with paychecks and lavish benefits made possible, ironically, with the taxes paid by law-abiding citizens.”
Ernst says she has introduced legislation called the Audit the IRS Act, which would require “annual audits of agency employees and the termination of every IRS agent who isn’t paying their taxes.”