Tax Pros Don’t Need to Sweat the IRS Budget Cuts

This is the first post from our slew of freelancer candidates. The following is by Jeremy Woodward.

The House Appropriations Committee has settled on an IRS budget, and it’s not good news for everyone’s favorite group of suits and ties. The $11.8 billion allocation is $1.2 billion below what they requested. Probably not enough for a Tea Party Ball, but I’m pretty sure Grover Norquist jumped and clicked his heels upon hearing the news (image unavailable outside my head).
 
What does that mean for the lowly tax preparer? Probably nothing. I spent 25 minutes on hold with the IRS the other day to ask a simple question, only to be transferred to the ‘proper department’ and wait another 20. A 10% decrease in service would be, what, 4.5 minutes? What’s an extra 4.5 minutes in the ‘Waiting on IRS’ code in the grand scheme of things? It’s still better than the friendly message from the Colorado Department of Revenue, happily explaining after going through the whole menu list that, to ensure I get proper treatment, they’re going to hang up on me until they’re less busy.
 
IRS Commissioner Shulman offered his own grim predictions back in October of last year, claiming that “budget cuts will result in a direct increase to the nation’s debt.” I’m still not sure if that was intended as a warning or a threat, but I guess we’ll find out soon enough.
 
And honestly, Shulman, why would enforcement change? I’m pretty sure the IRS’s main tactic is denying tax credits unless the company provides enough documentation to make the nearest forest sweat. How much money does it really cost the IRS to send a letter saying, “You won’t get an R&D credit unless you give us your firstborn* child”? 
 
This would have been less of a problem if the IRS had just waited on their budget before issuing those new repair regs. Now they have more work and less money. I’d probably start making threats, too.
 
So the next time you make it through the IRS hold music and Mr. Anderson, agent number #102934852374 sounds less than chipper, you’ll know why. Tell him if he audits one of your clients in the near future you’ll give him an under-the-table candy bar. Just don’t give him any identifying information in case he confuses kindness with bribes.
 
*Firstborn children make for inexpensive agents.

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