September 02,2015

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Wyden Cautions IRS Resource Cuts Could Fuel Tax Evasion, Data Theft

In Letter to IRS Commissioner, Finance Leader Asks How Budget Cuts Could Weaken Data Security, “Embolden Tax Cheats and Increase Deficits”

WASHINGTON –Senate Finance Committee Ranking Member Ron Wyden, D-Ore., today sent a letter to IRS Commissioner John Koskinen asking how deep cuts made by Congress to IRS resources over the last several years could hamper the agency’s ability to crack down on tax cheats -- and fuel cyberattacks against taxpayer data.

“Cutting enforcement spending, such as by performing fewer audits, will embolden tax cheats and increase deficits, heaping a new burden onto the backs of honest taxpayers. Furthermore, cutting funding intended to modernize the agency’s 1960s-era IT systems makes it easier for fraudsters to steal taxpayers’ identities or hack into IRS computers,” Wyden wrote in the letter.  “Congress ought to increase resources to the IRS if it expects the agency to bring its antiquated computer systems into the 21st century to prevent these criminal attacks going forward. Cutting resources to the IRS and similarly-affected government agencies could essentially hand tax cheats and foreign crime syndicates the financial keys to the country.”

According to the National Taxpayer Advocate, the IRS budget was reduced by 17 percent, after adjusting for inflation, between FY 2010 and FY 2015. A further cut of nearly $350 million was made in December 2014, and an appropriations proposal for FY 2016 would cut nearly $500 million more, while increasing the agency’s service workload.

The full letter from Senator Wyden to Commissioner Koskinen can be found here.