Yellen Says Debt Deal’s $21 Billion IRS Clawback Won’t Affect ‘Near-Term’ Plans

Christopher Condon, Bloomberg News

WASHINGTON, DC - MARCH 16: U.S. Treasury Secretary Janet Yellen testifies about the Biden Administration's FY2024 federal budget proposal before the Senate Finance Committee in the Dirksen Senate Office Building on Capitol Hill on March 16, 2023 in Washington, DC. Yellen said the nation's baking system is sound after the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corporation announced Sunday that depositors in Silicon Valley Bank in California and Signature Bank in New York will be repaid in full after both banks collapsed last week. (Photo by Chip Somodevilla/Getty Images) , Photographer: Chip Somodevilla/Getty Images

(Bloomberg) -- Treasury Secretary Janet Yellen said Congress’ clawback of more than a quarter of the funding previously approved for a rebuilding of the Internal Revenue Service won’t hinder the agency’s near-term goals to improve service and ramp up enforcement.

“I want to assure you that the IRS has the resources it needs in the near term – to modernize customer service and improve enforcement among high earners and large corporations that are not paying the taxes they owe,” Yellen said in a speech Thursday.

“We plan to continue to advocate for additional resources to make service improvements and help ensure that high-end taxpayers pay their fair share.”

As part of a deal to cap spending and suspend the debt ceiling, President Joe Biden agreed last month to redirect $21 billion away from the IRS over a decade.

Last year, with Congress under Democratic control, lawmakers approved an $80 billion spending plan, over 10 years, aimed at modernizing outdated computer systems, boosting customer service and increasing enforcement efforts focused on high-income earners and large corporations.