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Yellen calls for modernized IRS at Maryland field office

AP News by AP News
September 15, 2022
in AP Business, AP News
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By FATIMA HUSSEIN
Associated Press

NEW CARROLLTON, Md. (AP) — Treasury Secretary Janet Yellen laid out her vision for a modernized, responsive, tech-savvy tax collection agency equipped to manage 21st century challenges at an IRS office in New Carrollton, Maryland, on Thursday.

Yellen said the agency plans to hire 5,000 new customer service representatives to vastly improve taxpayer service before the next filing season, using part of the money from a recent $80 billion infusion of funds from the so-called Inflation Reduction Act.

Yellen gave her address against the backdrop of false narratives pushed by Republicans regarding the thousands of new IRS workers expected to be hired with the money under the new law approved last month. GOP representatives say the IRS will be targeting the taxes of working-class Americans with armed auditing agents.

She said she wanted to focus on giving the IRS the ability to digitize paper tax returns as well as answering phones that have been ringing off the hook.

This was Yellen’s first visit to an IRS facility as treasury secretary. Her speech to several thousand employees also addressed the importance of their work at a pivotal time in the agency’s history.

“The Inflation Reduction Act finally provides the funding to transform the IRS into a 21st century agency,” she said. “For taxpayers, this means faster processing and faster refunds.”

Getting the agency increased funding was even recently considered a pipe dream, as administration officials have long talked about how IRS computer systems run on outdated technology and getting adequate customer service has turned into a cottage industry.

In Maryland, Yellen talked about updating computer systems to help automate the scanning of millions of individual paper returns into a digital copy by next filing season, bolstering enforcement on high-wealth taxpayers and companies, and hiring thousands more people to answer the phones.

“For too long, IRS Tax Assistance Centers have been massively understaffed and under-resourced. No longer,” she said. “By next year, every single center will be fully staffed,” which will provide an estimated 2.7 million taxpayers with in-person assistance, she said.

Last month, shortly after the IRA funding was secured, Yellen directed the IRS to develop a plan within six months outlining how the tax agency will overhaul its technology, customer service and hiring processes. In part, the improvements are meant to “end the two-tiered tax system, where most Americans pay what they owe, but those at the top of the distribution often do not,” Yellen said in an August memo to IRS Commissioner Chuck Rettig, whose term ends in November.

The White House said it has not yet chosen a successor for Rettig.

Yellen’s speech comes as Republican lawmakers have distorted how the tax collection agency will spend the multi-billion dollar infusion of funds.

Republican leaders, including House Minority Leader Kevin McCarthy, R-Calif, Sen. Ted Cruz, R-Texas, and Rep. Marjorie Taylor Greene, R-Ga., have tweeted false claims about how many workers the agency intends to hire.

During her speech, Yellen said “by hiring 5,000 additional customer service representatives,” by next tax season “we will also cut phone wait times in half — from an average wait of nearly 30 minutes during the 2022 filing season to less than 15 minutes.”

“Especially amid the recent rise in deeply unfair and dangerous misinformation and threats, there is nothing more important to me than for you to be able to safely carry out your critical job for the American people,” she said.

Responding to an increasing number of threats born of conspiracy theories that agents were going to aggressively target middle income taxpayers, the IRS announced last month that it was conducting a review of safety at its facilities.

Yellen is on a monthlong tour, which is part of a larger White House campaign, to highlight new laws intended to repair the economy, boost computer chip manufacturing, lower prescription drug prices, expand clean energy and revamp the country’s infrastructure.

Yellen said she wants to restore fairness to the tax code by ensuring wealthy Americans and big corporations pay the taxes they owe. “In sum, high earners are paying far less than they owe,” she said.

“The tax gap – the amount of unpaid taxes – has grown to enormous levels. It’s estimated at $7 trillion over the next decade,” she said.

In her address, she also commended IRS employees for stepping up during the pandemic and helping to deliver Advance Child Tax Credits and three rounds of stimulus checks.

“While all the improvements won’t be done overnight,” she said, “taxpayers can expect to feel real differences during the next filing season.”

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

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