The Internal Revenue Service (IRS) announced this week that they have collected $1.3 billion from wealthy individuals that have avoided paying taxes for the past few years.
On Friday, Treasury Secretary Janet Yellen and IRS Commissioner Danny Werfel made the announcement, citing “new milestones” under the Inflation Reduction Act and how they have worked to ensure that wealthy individuals pay taxes.
“The IRS in February 2024 launched an initiative to pursue 125,000 high-income, high-wealth taxpayers who have not filed taxes since 2017,” the IRS said in an announcement. “These are cases where IRS has received third party information—such as through Forms W-2 and 1099s—indicating these people received income between $400,000 and $1 million or more than $1 million, but failed to file a tax return. Prior to the Inflation Reduction Act, the IRS non-filer program ran sporadically since 2016 due to severe budget and staff limitations that did not allow these cases to be pursued.”
“In the first six months of this initiative, nearly 21,000 of these wealthy taxpayers have filed, leading to $172 million in taxes being paid,” the announcement said.
According to the IRS, roughly 80 percent of the 1,600 millionaires with delinquent tax returns have now made payments to the agency, “leading to over $1.1 billion recovered.”
“This is an additional $100 million just since July, when Treasury and IRS announced reaching the $1 billion milestone,” the IRS said.
In this photo illustration, a 1040 U.S. Individual Income Tax Return document is seen on a desk on April 15, 2024, in North Haledon, New Jersey. On Friday, the IRS announced that it has collected over $1 billion from wealthy individuals who avoided paying taxes.
Michael Bocchieri/Getty Images
As part of its modernization efforts, the IRS launched a program this year called Direct File, enabling individuals with straightforward W-2s to calculate and submit their returns directly. By April, the IRS reported that users of the program had claimed over $90 million in refunds.
The program initially included 12 states for the 2024 tax filing season, but additional states, such as Maryland, Oregon, New Jersey, Pennsylvania, New Mexico, Connecticut, North Carolina, Wisconsin and Maine, have signed on for 2025.
“The IRS is working to deliver the same modern online experience that taxpayers experience with their bank or financial institutions. Using Inflation Reduction Act resources, the IRS has created and enhanced popular and convenient online tools that save taxpayers time and money, while also reducing phone calls, paper processes, and other burdens on IRS employees,” the IRS said.
However, in recent months, some Republicans have called for IRS funding to be limited.
Donald Trump’s presidential campaign claims he would significantly cut spending on federal agencies, while accusing Democratic nominee Kamala Harris of casting the tie-breaking vote to hire 87,000 new IRS agents to target Americans’ tip income.
This article includes reporting from The Associated Press.
