The agency, which received an additional $60 billion in funding from the Inflation Control Act of 2022, has hired hundreds of experienced accountants over the past year and a half after years of staffing cuts. Some of them have been focused on specific groups of delinquent taxpayers, including a group of 1,600 households earning more than $1 million a year that, based on past tax returns, were found to owe at least $250,000 in back taxes. IRS leaders, who have faced staffing shortages in the past, acknowledge that agents have not tried to collect those taxes for years.
The new enforcement campaign began last year by sending letters to at least 1,500 people in the targeted group, asking them to pay their past due amounts, Wurfel said. In the first month or so, about 100 of those targeted had paid a total of $100 million in taxes, interest and penalties, Wurfel said.
Others involved much more effort and, in some cases, seizures from taxpayers’ assets to collect the money.Werfel described months of correspondence between the IRS’s new employees and the billionaires’ accountants and lawyers.
The measures, which IRS officials explained this week, are targeted at people who have filed tax returns but not paid the taxes. The agency is also going after a much larger group: wealthy people who don’t file returns at all.
The IRS stopped sending letters reminding people that they had failed to file returns in 2017. It resumed the practice this year, notifying up to 25,000 people who previously reported annual income of $1 million or more, and up to 100,000 people who reported annual income of $400,000 or more, that they had failed to file returns in one or more recent years.
Warfel said he plans to report in the fall on how much revenue those letters have generated.
“If the IRS fails to fulfill its mission and responsibility to enforce the tax laws, [it] “It creates an atmosphere where more people think they can’t or won’t file their taxes,” Warfel said. “Announcements like this, showing that we’re working aggressively to identify non-filers and delinquent taxpayers, should serve as a warning to other taxpayers.”
