White House lowers funding request for IRS

President Obama is seeking $12.5 billion in funding for the Internal Revenue Service in his 2015 budget — a sizable increase over what the agency currently gets, yet less than the White House asked for last year.

The IRS, still feeling the scars of the targeting controversy that erupted last year, is now getting $11.3 billion a year, under the budget agreement struck in December. The White House had asked for $12.9 billion in its budget a year ago.

In all, the White House asks for an even $12 billion in base funding for the IRS, and an extra $480 million in money for enforcement.

That extra pool of money is aimed at cracking down on tax evasion and reducing the difference between what taxpayers owe and what the IRS actually collects — last estimated at $450 billion.

In the 2015 budget, the White House also seeks more than $100 million in extra funding for the IRS’s customer service efforts. The White House says, with the influx of new money, the IRS could answer about four of five calls from taxpayers, up from the current three in five.

The new IRS Commissioner John Koskinen has especially complained that insufficient funding for his agency has led to deteriorating services for taxpayers. At the start of the current filing season, Koskinen even advised taxpayers against trying to call the agency’s help lines.

Still, the push for new IRS funding is likely to go nowhere in Congress, as are many of the policy proposals Obama lays out in the budget.

Congressional Republicans, following the IRS’s admission last year that it singled out Tea Party groups for extra scrutiny, have shown interest in slashing the agency’s budget even more.

GOP lawmakers also generally have brushed aside suggestions showing that funding earmarked for IRS enforcement could bring back several times as much in new revenue. 

The White House budget also looks to ensure the IRS has enough funding in place for implementing the president’s healthcare law, with 2015 being a crucial year for the premium tax credits aimed at ensuring people in the U.S. obtain insurance.