IRS Achieves Milestone: $1 Billion Back Taxes Recovered From Wealthy Taxpayers

The U.S. Internal Revenue Service (IRS) has collected $1 billion in back taxes from high-income individuals over the past year. This milestone is part of a broader effort to increase scrutiny on taxpayers with incomes exceeding $1 million and tax debts over $250,000. The initiative, supported by $60 billion in additional funding from the 2022 Inflation Reduction Act, aims to improve enforcement and collection capabilities. The IRS has employed skilled accountants and sent letters to at least 1,500 individuals, with about 100 paying $100 million in taxes, interest, and penalties within the first month.

In addition to targeting non-filers and those with significant tax debts, the IRS is addressing tax avoidance strategies like "partnership basis shifting," which could generate over $50 billion in revenue over the next decade. The Treasury Department has proposed rules to curb this practice. Critics, particularly congressional Republicans, have expressed concerns about the allocation of resources and have threatened budget cuts to the IRS. A recent debt ceiling and budget cuts package passed by Congress in 2023 included a $1.4 billion reduction to the IRS budget and plans to divert $20 billion over two years to non-defense programs.