WASHINGTON — U.S. Sens. John Thune (R-S.D.), ranking member of the Subcommittee on Taxation and Internal Revenue Service (IRS) Oversight; Chuck Grassley (R-Iowa), former chairman of the Senate Finance Committee and a current member of the Subcommittee on Taxation and IRS Oversight; and U.S. Rep. Mike Kelly (R-Pa.), chairman of the House Ways and Means Subcommittee on Tax Policy, today introduced the IRS Funding Accountability Act. This bicameral legislation responds to the Democrats’ use of the so-called “Inflation Reduction Act” (IRA) that will infuse the IRS with $80 billion of new funding without any oversight measures to prevent waste, protect taxpayer rights, or measure improvements of service. The IRS Funding Accountability Act would give Congress a direct say in how this new funding could be spent, hold the IRS more accountable, and provide more transparency for the American people.
“The Democrats’ attempt to supersize the IRS without holding the agency accountable to Congress and American taxpayers is dangerous and irresponsible,” said Thune. “This legislation would provide much-needed oversight of the unprecedented $80 billion in funding to the agency, more than half of which Democrats have directed toward enforcement-related measures, including audits. If our bill becomes law, the Biden administration’s IRS would have to answer to the American people, not Washington bureaucrats.”
“Government, especially when it comes to the treatment of taxpayers, needs to be accountable and transparent to the American people,” said Grassley. “When Democrats’ partisan spending bill gave the IRS an extra 80 billion dollars last year, their legislation included no oversight and accountability mechanisms whatsoever. Our bill will ensure that the IRS is answerable to the American people in how it uses this money, and will force it to forfeit funds every day it’s not in compliance.”
“Democrats and the Biden administration have weaponized the IRS over the last two years to pay for their tax-and-spend agenda. The time for oversight is now,” said Kelly. “The $80 billion authorized in the so-called Inflation Reduction Act will unfairly target low-and-middle income Americans. The goal of my legislation is to provide much-needed oversight and accountability that the Inflation Reduction Act lacks. This will hold government accountable to the American people and ensure the IRS is properly using taxpayer dollars.”
“Strict oversight of the IRS is a basic responsibility of Congress,” said Grover Norquist, president of Americans for Tax Reform. “Yet Biden and Democrats handed the IRS $80 billion to go after taxpayers without any oversight or accountability measures. They thought they could send IRS agents to shakedown taxpayers without anyone noticing. People noticed. This bill would help rein in IRS abuse and waste while increasing Congress' oversight abilities. Every lawmaker should back this bill.”
“The $80 billion in IRS funding included the so-called Inflation Reduction Act came with almost no guardrails for an agency that has fallen chronically short on core elements of their mission in recent years,” said Pete Sepp, president of the National Taxpayers Union. “National Taxpayers Union (NTU) is proud to support the IRS Funding Accountability Act, which would require the IRS to provide Congress with a genuine and realistic plan for spending the most significant influx of funds the agency has ever received. The bill would also require the IRS to regularly update Congress on their spending, ensuring ongoing accountability of the agency over the next 10 years. On behalf of the nation’s taxpayers, NTU gratefully applauds Senators Thune and Grassley for their leadership on IRS oversight.”
“The Inflation Reduction Act directed 80 billion taxpayer dollars to the IRS, with the majority earmarked to increase the agency’s enforcement activities,” said Brent Gardner, chief government affairs officer for Americans For Prosperity. “With little to no information about how the agency plans to use those taxpayer dollars or hold itself accountable, the IRS Funding Accountability Act would implement commonsense measures to increase oversight and transparency on behalf of the American taxpayer. Americans for Prosperity thanks Senators Thune and Grassley for introducing this legislation.”
The legislation is co-sponsored by all Republicans on the Senate Finance Committee, including U.S. Sens. John Barrasso (R-Wyo.), Marsha Blackburn (R-Tenn.), Bill Cassidy (R-La.), John Cornyn (R-Texas), Mike Crapo (R-Idaho), Steve Daines (R-Mont.), James Lankford (R-Okla.), Ron Johnson (R-Wis.), Tim Scott (R-S.C.), Thom Tillis (R-N.C.), and Todd Young (R-Ind.). The legislation is also co-sponsored by Republicans on the House Ways and Means Committee, including U.S. Reps. Ron Estes (R-Kan.), Randy Feenstra (R-Iowa), Darin LaHood (R-Ill.), and Lloyd Smucker (R-Pa.).
The legislation would, among other things, require the IRS to provide Congress with an annual plan for how the agency intends to use the new IRA funds, which would be subject to a new joint resolution of disapproval. The bill would also require quarterly updates from the IRS and U.S. Department of the Treasury to enable consistent and transparent evaluation of the plans, provide accountability for any misuse of funds, and guard against violations of taxpayer rights. Failure to submit timely and thorough plans or reports would result in financial penalties, including IRA funds being rescinded on a daily basis until the IRS complies with the reporting requirements.
Additional background information on the bill (S.338 and H.R.888) can be found here.