IRS says it has levied $1 billion in overdue taxes from millionaires | Wilnesh News

The U.S. Treasury Department and the Internal Revenue Service announced Thursday that they recovered more than $1 billion in taxes from high-income individuals last year, marking what they called a “major milestone.”

Armed with tens of billions of dollars in new funding, the IRS announced in September plans to expand scrutiny of people who earn more than $1 million a year and have confirmed tax debts of more than $250,000.

“The IRS has raised $1 billion from millionaires, demonstrating that it can successfully launch strategic new initiatives and achieve maximum return on investment,” U.S. Treasury Secretary Janet Yellen told reporters at a news conference.

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If funding continues, IRS investments in enforcement, technology and data could generate up to Will reach $851 billion by 2034agencies expect February.

However, the infusion of IRS funding enacted through the Inflation Reduction Act of 2022 remains criticized, especially by congressional Republicans.

“Over the past decade, the IRS has not had the resources or personnel to pursue high earners that our compliance teams knew owed taxes,” IRS Commissioner Danny Wayfair said in a news release.

Wayfair said that due to budget constraints, the unpaid taxes collected from similar earners before the Inflation Reduction Act provided funding would be negligible. “The difference is really like night and day,” he said.

According to the latest available data, the audit rate for taxpayers earning $1 million or more was 0.7% in 2019, compared with 7.2% in 2011 IRS.

The U.S. Government Accountability Office and the U.S. Treasury Department’s Inspector General for Tax Administration have recent review IRS high income audit process. While both agencies’ reports addressed their audit selection processes, the Treasury report specifically noted higher no-change rates in audits of certain high-income filers.

“Our goal has always been to eliminate the risk of a zero-balance due audit,” Wayfair said at a news conference on the agency’s report.

The latest announcement comes less than a month after the IRS and Treasury Department unveiled plans to close “significant tax loopholes” exploited by large, complex partnerships. The crackdown could raise $50 billion in tax revenue over the next 10 years, according to agencies.