Americans fear IRS will use Inflation Reduction Act funding to audit average and lower-income taxpayers

Americans in the nation's capital told FOX Business they were worried that additional funding for the IRS through the Inflation Reduction Act could lead to more audits for typical taxpayers.

"Are we actually going after lower-income people or are we going after higher-income people?" one woman, Adrian told FOX Business. "My concern is that the lower-income people are losing out on this policy change."

Benjamin shared a similar concern: "Are they going after the rich and famous or are they going after the average person?"

The Senate on Sunday passed the Inflation Reduction Act, which includes an $80 billion boost to the IRS over a 10-year period, with more than half intended to help the agency crack down on tax evasion. The agency could afford an additional 87,000 employees – more than doubling its current size – with that amount, the Biden administration projected last year.

GOING AFTER 'THE LITTLE GUY': ARIZONANS OPPOSE BILLIONS IN IRS FUNDING AS SINEMA SAYS SHE WILL SUPPORT BILL

"The IRS needs to be smaller, not bigger," one man, Keith, told FOX Business. He said it was "ridiculous" to double the size of the IRS.

Senate Democrats projected that enhancing IRS funding could add an extra $124 billion in federal revenue over the next decade by hiring more tax enforcers who can crack down on rich individuals and corporations attempting to evade taxes. Roughly $1 trillion in federal taxes goes unpaid yearly because of errors, fraud and a lack of resources to adequately enforce collections, according IRS Commissioner Chuck Rettig estimated last year.

Mike, who has been audited before, believes the expansion would mean the IRS would "go after the small guy."  

"I don't think they go after big companies," he said. 

HOW DEMOCRATS' BEEFED-UP IRS COULD HURT LOW-INCOME AMERICANS

Households with less than $25,000 in earnings were five times as likely to be audited by the IRS than everyone else in fiscal 2021, according to an analysis by Syracuse University's Transactional Records Access Clearinghouse. The reason for that is a rise in what is known as "correspondence audits," meaning the IRS conducts reviews of tax returns via letters or phone calls rather than more complex face-to-face audits.

Keith worried that the IRS would "have to be going after more taxpayers like me." 

The IRS wouldn't increase audits on households earning less than $400,000, Rettig told Congress last week.

Additionally, the nonpartisan Congressional Budget Office found last week that the Inflation Reduction Act would have a negligible impact on inflation.

WSJ EDITORIAL BOARD SLAMS SCHUMER-MANCHIN BILL FOR UNLEASHING ‘BEAST MODE’ IRS TO ‘TARGET’ THE MIDDLE CLASS

Mike, of Texas, said: "There's too much bureaucracy already. Anything you use to raise taxes, it's going to increase inflation."

Adrian told FOX Business: "The government put a lot of money in the system with the stimulus checks, and now it's time to get some of that money out of the system." 

CLICK HERE TO READ MORE ON FOX BUSINESS

Some felt the $80 billion could be put to better use.

"I guess in theory if they hire more people, then they will catch more people evading taxes," one man, Kofie, told FOX Business. "But definitely feel like the money could be allocated somewhere else, like infrastructure, education system, something like that."

Another man named, Tristan, similarly said: "$80 billion is a lot to fund any one thing. I feel like that could be better allocated."

Megan Henney contributed to this report