Improving the IRS Through Budget Revamp and Increased Funding for Taxpayer Services and IT Modernization
Congress controls the budget of the Internal Revenue Service (IRS) by dividing its annual appropriation into four accounts: Taxpayer Services, Enforcement, Operations Support, and Business Systems Modernization. The IRS is generally not allowed to reallocate its funding among these accounts, with limited exceptions. Under the Congressional Budget and Impoundment Control Act of 1974, the federal budget process is generally a zero-sum game, meaning that a dollar allocated to one agency or program leaves one less dollar available for allocation to another agency or program. However, Congress can authorize a “program integrity allocation adjustment” (PIAA) which allows it to provide additional funding to the IRS for enforcement initiatives that are projected to generate a positive return on investment. PIAAs have not been authorized since 2010, but almost every administration’s budget proposal has requested one.