IRS Raked in $3.3T in Total Tax Revenue in FY 2015by
Despite fewer employees and a 3 percent budget cut, the IRS received and collected 8 percent more in tax revenue in fiscal year 2015 than in the previous year, according to an annual review of the agency’s collections and examinations by the Treasury Inspector General for Tax Administration (TIGTA).
But that doesn’t mean all is well with fewer bucks and people.
“While the IRS’s efforts to improve its future state are ongoing, operations continue to be affected by reductions in funding and employee attrition,” the report states. “Administration and enforcement of the nation’s tax code requires the largest portion of the IRS’s resources, and while total tax revenue has increased, the work of IRS enforcement programs continues to be affected by resource constraints.”
Total dollars received and collected by the IRS increased for the fifth consecutive year. The $3.3 trillion collected in FY 2015 was 37 percent higher than the $2.4 trillion reported in FY 2011 and 8 percent higher than the $3.1 trillion collected in FY 2014.
However, the IRS budget dropped from $11.3 billion in FY 2014 to $10.9 billion in FY 2015. And “decreases in funding have continued to affect the number of IRS employees available to meet the IRS mission,” the report states. Full-time staffers decreased 5 percent, from 82,985 at the end of FY 2014 to 78,547 at the end of FY 2015, and have dropped 16 percent since FY 2011. In addition, the number of all staffers, including temporaries, has dropped 18 percent from 2011.
Before 2011, hiring during FY 2009 and FY 2010 provided the largest increase in the number of IRS enforcement agents since 1999.
Here’s the fallout.
Revenue from enforcements has dropped 5 percent, from $57.1 billion in FY 2014 to $54.2 billion in FY 2015. Unpaid assessments rose to $412 billion. Fewer enforcement actions were used in 2015, and levies, seizures, and federal tax lien notices declined.
Collections, on the other hand, are a mixed bag. Collections on delinquent accounts increased in every program except field collections. But collections also received more delinquencies than it closed, though the number of closed uncollectible accounts has dropped over recent years. Use of payment options, such as offers in compromise and installment agreements, has decreased, but the amount of delinquent taxes collected through those options has increased.
The examinations group did fewer exams in 2015, and field exams dropped 28 percent since FY 2011.
“Declines in the number of examinations are directly related to the 24 percent decline in the revenue agents and tax compliance officers available to perform them during that period,” the report states.
Terry Sheridan is an award-winning journalist who has covered real estate, mortgage finance, health care, insurance, personal finance, and accounting and taxation issues for newspapers, magazines, and websites. A Chicago native and former South Florida resident, she now lives in New England.