Treasury secretary says increased IRS audits to focus on the very wealthy
PITTSBURGH (KDKA) -- It's tax time, and many taxpayers worry that if they make a mistake on their tax returns, they will be audited by agents of the Internal Revenue Service.
In KDKA-TV money editor Jon Delano's exclusive interview with Treasury Secretary Janet Yellen, Yellen said middle class Americans have nothing to worry about.
President Biden's Inflation Reduction Act included more money for better customer service and more agents at the IRS. When Republicans took control of the U.S. House last year, they immediately tried to cut back on the additional agents, arguing they would go after the little guy.
"This is a tremendous misconception, and I am really pleased to have an opportunity to address it," Yellen said when asked about the claim.
Yellen says the IRS has been "starved" for resources for decades -- and it shows.
"The consequence of that has been horrendous customer service, especially during the pandemic, and also very low levels of audits of wealthy individuals, complex partnerships and corporations," Yellen said.
The treasury secretary says the new resources have allowed the IRS to modernize its technology and improve customer service.
"When they pick up the phone, we've promised this year 85 percent of calls will be answered in five minutes or less," Yellen said.
As for the audits of tax returns, Yellen says it's not for the little guy.
"Individuals earning $400,000 or less and small businesses, there will be no increase in the audit rates," Yellen said.
"This does not affect honest, hard-working Americans, anyone with small businesses. That's not what the resources are devoted to."
Instead, by going after the multi-millionaire and billionaire crowd, Yellen says, "An additional $850 billion in revenue will be collected because of these efforts over the next decade."
Delano: "Are you catching the tax scofflaws?"
Yellen: "We're beginning to, and the more people we hire, you'll see higher and higher payoffs over time, and normal, middle-class Americans have nothing to worry about."