Senator Carper Highlights Need for IRS Modernization

With funding provided by the Inflation Reduction Act, the IRS can make the tax filing system fairer and more accessible for all Americans

WASHINGTON, D.C. – Today, at the Senate Finance Committee hearing “The President’s Fiscal Year 2024 IRS Budget and the IRS’s 2023 Filing Season,” U.S. Senator Tom Carper (D-Del), a senior member of the Committee, highlighted critical issues affecting the IRS and the U.S. tax filing system and how the President’s Fiscal Year 2024 Budget Request will address some of these challenges. After years of underfunding, the Inflation Reduction Act (IRA) enacted last year provides the IRS with nearly $80 billion in new resources over the next decade, allowing for significant improvements to the agency’s customer service operations and processing of tax returns. During the hearing, IRS Commissioner Daniel Werfel testified to how the IRA’s investments in the agency and the President’s budget request will help the IRS root out tax fraud and examine additional free e-filing options.

At the start of his remarks during the hearing, Senator Carper thanked Commissioner Werfel for his testimony and emphasized the importance rooting out fraudulent paid tax preparers:

“While most preparers provide excellent service to their clients, the IRS receives tens of thousands of complaints each year about bad actors. And for these reasons the General Accountability Office has recommended again and again that Congress give the IRS the authority to establish standards to properly regulate paid preparers, especially those who may be acting in bad faith or preparing inaccurate tax returns.”

Senator Carper then highlighted the need to simplify the tax filing process and expand access to free e-filing options:

“While the Free File program was created to simplify this process at no cost for lower income taxpayers, that program is not working as intended… The General Accountability Office not long ago found that the programs utilization rate is drastically low, disappointingly low, with some 4% of the eligible taxpayers using the program in 2020. In response, the GAO recommended that the IRS offer additional options for free online filing services. Fortunately, thanks to the Inflation Reduction Act, the IRS now has the resources to expand access to free simplified filing options which would improve tax compliance and strengthen the fairness of the tax system.”

A full video of Senator Carper’s remarks at today’s hearing can be found here.