In her annual report to Congress, National Taxpayer Advocate Erin Collins said the IRS provides an enormous return on investment for taxpayers and requires sustained funding to continue to improve.
For example, revenue collected by the IRS, which provides 96% of government funding, totaled $5.1 trillion in fiscal year 2024 on an appropriated budget of $12.3 billion. Collins described that return on investment, 414:1, as “remarkable.”
"Paradoxically, the tighter the rest of the federal budget becomes, the more important it is to fully fund the IRS so it can collect the taxes required to fund other government functions," Collins noted.
Collins highlighted the difference between the money allocated for enforcement in the Inflation Reduction Act (IRA) and other IRA areas.
While the IRS allocated 58% of the original $79 billion (over 10 years) for enforcement, just 6% went toward technology modernization and 4% to taxpayer services. The agency used the remaining 32% for operations support.
"I want to highlight this distinction so that if Congress decides to cut IRA funding, it does not inadvertently throw the baby out with the bathwater," wrote Collins, who repeatedly has advocated for more IRA dollars for taxpayer services and technology. See her recommendations.