IRS paperless system will cut deficit significantly over 10 years
U.S. Secretary of the Treasury Janet Yellen arrives to deliver remarks at Johns Hopkins University’s School of Advanced International Studies (SAIS) on April 20, 2023 in Washington, DC.
WASHINGTON — Treasury Secretary Janet Yellen praised a new initiative by the IRS that she said will help reduce the federal deficit by $2.6 trillion over the next 10 years — an extension of the Biden administration's pledged $1 trillion in deficit reduction from the Inflation Reduction Act.
The agency's new "paperless processing" program will help reduce the burden of processing the 200 million paper documents received each year at a cost of around $40 million annually in storage costs by allowing customers to digitally submit documents to the IRS.
The initiative is a "key" to unlocking other system improvements, said Yellen, including error reductions in tax processing and secure data access for taxpayers.
"I urge Congress to provide stable and sufficient annual appropriations for the IRS in order to sustain and build on this progress," Yellen said.
She also applauded the Biden administration's efforts to close the tax gap that, without intervention, would have reached $7 trillion over the next decade. The IRS has prioritized hiring personnel to assist in auditing large corporations, complex business partnerships and other wealthy taxpayers, a process that takes up to 50 times longer compared with simple audits.
The agency has already recovered roughly $38 million from about 175 delinquent tax cases for millionaires, said Yellen.
"Today's announcement — and the other milestones that we've already reached — are a testament to what dedicated federal employees can do when they are provided the tools and resources to succeed," she said.
CORRECTION: This story has been updated to say that the IRS paperless system will help with the Biden administration's effort to cut into the federal deficit by $2.6 trillion over the next 10 years.
Source: CNBC
