Janet Yellen

The Internal Revenue Service hopes to process all of the tax correspondence, notice responses and nontax forms it receives digitally in the next two years.

The Treasury Department is trying to modernize the badly outdated agency in a bid to improve customer service and ramp up enforcement.

The Treasury Secretary Janet Yellen underscored the urgency of the White House reaching a deal with Republicans to raise the debt limit.

Republicans rejected a Democratic proposal that would seek to raise revenue by altering a dozen tax provisions.

She advised Congress that the Treasury may exhaust its special accounting maneuvers to avoid running out of sufficient cash as soon as early June.

The government reached the statutory cap on borrowing in January and the Treasury has since been using special accounting measures to make cash available.

The Treasury Secretary said her department's ability to use special accounting maneuvers to stay within the federal debt limit could be exhausted soon.

"Our budget request provides steady-state operational funding," Yellen said. "It will complement the one-time, long-term investment in the IRS."

The Treasury Secretary defended the extra investment in the IRS, arguing it is already paying off and that taxpayers are getting "drastically improved customer service this year."

The department detailed the tax provisions in the Biden administration's newly released budget plans for fiscal year 2024 on Thursday.