Crackdown on Delinquent Rich Taxpayers by Biden Administration

The Biden Administration’s Efforts to Crack Down on Delinquent Rich Taxpayers

The Biden administration has been diligently working on cracking down on delinquent rich taxpayers over the past year, resulting in a significant milestone of recovering $1 billion. This achievement, announced by the Treasury Department, is attributed to the enhanced enforcement efforts of the Internal Revenue Service (IRS).

IRS Modernization Initiative

The IRS has embarked on a $60 billion modernization initiative to enhance its customer service and combat tax evasion among wealthy individuals. The Biden administration has been supporting this initiative by allocating $80 billion to the agency. However, there have been attempts by Republicans in Congress to reduce this funding.

Successful Tax Collection

Treasury Secretary Janet L. Yellen highlighted the success of efforts to increase tax fairness and collect revenue from high-income taxpayers who have been delinquent in paying their taxes. The IRS targeted 1,600 taxpayers with over $1 million in income and owing more than $250,000 in tax debt.

Enforcement Measures

IRS Commissioner Daniel Werfel emphasized the agency’s increased enforcement capabilities, enabling them to track down wealthy taxpayers with outstanding tax debts. By sending letters and imposing penalties, the IRS has been able to prompt these taxpayers to settle their dues.

Expansion of IRS Resources

The funding for the IRS expansion was included in the Inflation Reduction Act of August 2022. While the agency was initially granted $80 billion, $20 billion was reallocated during negotiations to suspend the debt limit. The IRS is also targeting high-wealth individuals who have not filed taxes for years.

Additional Enforcement Actions

• Ramping up audits of hedge funds and real estate investment partnerships
• Cracking down on abuse of corporate jets for personal travel

Challenges and Progress

Despite these efforts, reports have indicated that the IRS needs to improve in resolving identity theft cases and addressing taxpayer queries promptly. As of the latest report, the IRS has utilized $5.7 billion, representing 10% of its allocated funding from the Inflation Reduction Act.