ACA demands may limit taxpayer response time, IRS chief says
Ogden • IRS Commissioner John Koskinen said Thursday that the agency's additional responsibilities under the Affordable Care Act in combination with its current budget could mean a steep deterioration in its ability to answer queries from taxpayers.
Koskinen was in Ogden as part of a tour of major operations of the Internal Revenue Service. He met with managers and employees at the agency's business return processing center here that employs about 5,000 people.
Under President Obama's health care reform program being implemented this year, the IRS is charged with administering credits and penalties for individuals and businesses.
But Koskinen said those responsibilities come after Congress has failed to restore the agency's funding to pre-sequester levels and amid uncertainty for its budget in the next fiscal year when it will be processing 2014 returns.
"We requested $440 million [in the current fiscal year] to implement the Affordable Care Act, including $300 million for information technology," Koskinen said. "Congress gave us zero."
The agency expects 11 million more calls to its offices as a result of the Affordable Care Act.
"If we operate at the same level as we do this year, with no additional resources, then our estimated customer support level will drop close to 50 percent, which means half the people calling won't get through, won't get an answer."
The IRS has a slew of offices and thousands of employees in Ogden where business-related tax returns for the nation are received and scrutinized and calls answered from preparers and businesses.
Koskinen also told reporters after meeting with Ogden employees that the agency would push ahead with new rules that define the level of political activity acceptable for a group to maintain its tax-exempt status.
A hearing will be scheduled for this summer to further review and refine the rules after the agency received 150,000 comments on the draft released late last year.
"People need to be comfortable that when they hear from us it's about something in their return, not an organization they belong to, their political beliefs, who they voted for in the last election," Koskinen said.
Senate Majority Leader Mitch McConnell and other conservatives have called on the Obama administration to drop the plans to clarify rules after a scandal over an IRS office that seemed to target conservative organizations for scrutiny.
"The commissioner has the ability to stop the IRS from stepping on the First Amendment altogether, and that's exactly what he should do," McConnell said in a statement, according to the Washington Post.
Koskinen said the agency had eliminated much of a backlog of applications for groups applying for tax-exempt status known as 501(c)(4) by implementing a requirement that applicants pledge not to spend more than 40 percent of their funds on political activities.
Interest in such organizations soared after the Citizens United ruling by the U.S. Supreme Court that freed up such groups to spend unlimited amounts of money on political messages.