Reportedly, President Joe Biden is looking to get an $80 billion payout to the Internal Revenue Service (IRS), in order to assist the government agency in increasing the number of audits it can process on high-income businesses and people. It also plans to seek out revenue that both corporations and individuals are “hiding” from the United States government, as reported by the New York Times in a document.
The Biden administration is seeking, and hoping, to raise about $700 billion, in return, from the planned expansion in tax enforcement. Biden seems to be taking this effort in hopes that he will be able to equalize the budget including the cost of his multi-trillion-dollar infrastructure plan that he plans to unveil this coming week.
The Biden administration is seeking to pair the increased enforcement by the IRS with the new “disclosure requirements” which are designed to make small business owners and other wealthy individuals pay in taxes cash that they might have otherwise kept in their pockets.
“President Biden, in an effort to pay for his ambitious economic agenda, is expected to propose giving the Internal Revenue Service an extra $80 billion and more authority over the next 10 years to help crackdown on tax evasion by high-earners and large corporations, according to two people familiar with the plan,” the Times stated in a report this past Tuesday. ” The additional money and enforcement power will accompany new disclosure requirements for people who own businesses that are not organized as corporations and for other wealthy people who could be hiding income from the government.”
The NY Times goes on to point out that the $80 billion payment is more than a 60% boost in the total funding usually given to the IRS, and it is added on top of a “discretionary budget request for the IRS” that “already included an extra $1.2 billion—a 10.4% bump over the previous year,” reported Forbes.
Additionally, the White House is seeking to set in place a set of tax increases that are mostly targeted at those making over $1 million per year. Biden has already shown that he wants a higher set of tax rates on individual income, but the plan reportedly also includes higher tax rates for corporations and doubling the capital gains tax rate. This could have a large impact on investments.
“The tax changes under discussion include hiking the top income-tax rate from 37% to 39.6% and the rate on long-term capital gains and qualified dividends from 20% to 39.6% (thus taxing investment gains at the same rate as ordinary income) for investors earning more than $1 million per year,” Forbes stated on Tuesday. “Biden has also proposed expanding payroll taxes for higher earners to help shore up the finances of the Social Security program and eliminating the ‘step-up’ in basis on assets in an estate—a tax loophole that means unrealized capital gains held at death are never taxed.”