Rep. Adrian Smith, R-Neb., discusses Treasury Secretary Janet Yellen admitting that 90% of new audits will affect families and small businesses on ‘The Bottom Line.’
President Joe Biden’s plan to hire 87,000 Internal Revenue Service (IRS) agents as part of the Inflation Act has raised concerns among Republicans who believe it will lead to increased audits on small businesses and families in America. Despite efforts by the administration and Democrats in Congress to dispute this claim, Treasury Secretary Janet Yellen recently confirmed that the proportion of new audits on individuals and small businesses earning less than $400,000 per year would remain consistent with historical levels.
According to the nonpartisan Government Accountability Office, over 90% of audits target families and small businesses below the $400,000 income threshold.
Treasury Secretary Janet Yellen testifies before the Senate Finance Committee on Capitol Hill on March 16, 2023. (Chip Somodevilla/Getty Images / Getty Images)
Despite concerns, the Biden administration has failed to provide a clear answer on this issue. When asked about the total number of audits of families earning less than $400,000 annually, Yellen clarified that she meant the proportion of new audits, not the total number. This means that 90% of new audits funded by the Inflation Act would still target small businesses and families earning less than $400,000. This is concerning considering the IRS’s current inefficiencies in customer service, with only one in eight calls being answered by an IRS employee and 1.4 million returns awaiting processing.
The Biden administration claims that their focus is on “tax cheats and billionaires,” but their actions suggest otherwise. With initiatives such as bank surveillance, the hiring of 87,000 new IRS employees, a proposed tip reporting program, and the reporting of online payments above $600, it is clear that this administration aims to scrutinize the private finances of everyday Americans.
U.S. Treasury Secretary Janet Yellen on Friday did not deny a claim made by Rep. Adrian Smith, R-Neb., that 90% of new IRS audits will be on individuals making less than $400,000 annually, contrary to promises from the White House.
The administration argues that the majority of the new IRS hires are due to attrition, but the actual decrease in Treasury’s headcount over the past decade is only 12,000, much lower than the 87,000 new hires they seek. Even if we take their word, this still results in 75,000 new IRS employees compared to 2012.
In line with our commitment to the American people, House Republicans have introduced the Family and Small Business Taxpayer Protection Act. This legislation aims to defund President Biden’s army of IRS agents, ensuring that families and small businesses are not unfairly targeted by audits. It also maintains funding for customer service improvements.
President Joe Biden delivers remarks at the National Association of Counties legislative conference on Feb. 14, 2023 in Washington, D.C. (Alex Wong/Getty Images / Getty Images)
As House Republicans, we are committed to a government that is accountable and works for the people. The American people deserve efficient service from agencies funded by their tax dollars, instead of unnecessary audits and bureaucracy. We believe that our focus should be on improving the economy and restoring Americans’ trust, which is why we introduced the Family and Small Business Taxpayer Protection Act.
Rep. Adrian Smith, a Republican, represents Nebraska’s 3rd Congressional District. He is a member of the House Ways and Means Committee.
