Budget cuts over the last five years have affected customer service at the IRS. In April, we discussed how furloughs of IRS workers and a hiring freeze also resulted in weaker enforcement of tax laws.
The funding crisis at the agency continues. At a recent IRS Nationwide Tax Forum in Chicago, IRS commissioner John Koskinen explained that the agency would only be able to answer about half of all taxpayer phone calls.
As the agency implements parts of the Affordable Care Act, taxpayers with questions about how the new healthcare law affects their taxes will not get answers. In January, a report by the National Taxpayer Advocate found that wait times averaged 18 minutes for those who were able to get through.
A report from the Center on Budget and Policy Priorities highlighted the drop in IRS funding. The budget fell from $13.2 billion in 2010 to $11.3 billion in 2014. Over this period, the agency cut 10,400 jobs.
The enforcement division absorbed the majority of staffing cuts. Fewer employees equal fewer audits. The number of tax audits completed this year will be on par with the number conducted back in the 1980s.
Even with fewer audits, it may also take longer to resolve an IRS tax audit. Often after staffing cuts, those who remain shoulder higher caseloads.
When complicated tax questions arise related to the healthcare law or another tax issue, it’s going to be even more difficult to get an answer directly by calling the IRS. In addition, you probably do not know what steps to take after receiving a notice from the IRS. A local tax attorney can answer questions and represent you through the audit process.
Source: The Guardian, "Nearly half of US taxpayers' phone calls to the IRS to go unanswered," Jana Kasperkevic, July 9, 2014.