IRS Commissioner John Koskinen told tax preparers and others who are frustrated with long wait times on the service’s phone lines to call their member of Congress.

Speaking in a keynote address to the annual meeting of the National Society of Accountants, Koskinen said, “Congress needs to hear and understand the impact of the funding cuts. As I tell people on Capitol Hill, we are the only agency still operating at the post-sequester level.”

The IRS budget was cut 7 percent in Fiscal Year 2014, even as the agency took on the burden of administering the tax provisions of the Affordable Care Act. This is “the biggest challenge facing the IRS,” according to Koskinen.

“Congress is starving our revenue-generating operation,” he explained. “If voluntary compliance with the Tax Code drops by 1 percent, it costs the U.S. government $30 billion per year. The IRS annual budget is only $11 billion per year.”

While IRS budget cuts may have been driven partially by outrage over the tax scandal involving targeting of conservative groups last year, Koskinen emphasized that “this was a mistake that should never happen again. My job is to make sure the public knows that.”

 

Beyond funding

Koskinen noted that when Congress passes tax law changes late in the year, it creates huge challenges for the IRS and taxpayers.

“We think it is unlikely that the tax provision extender package will pass before the mid-term elections, but we hope it will pass soon after that,” he said. “Congress needs to understand that the later these are passed and the more complicated they are, the more challenging it is for taxpayers to file accurate returns on time.”

Koskinen also spoke about the IRS voluntary education program the agency plans to implement by the beginning of the 2015 tax filing season. (See “IRS Offers Voluntary Tax Preparer Education Program.”) “It is important to keep the momentum going for the education of tax preparers but it is only an interim step,” he said of the education process.