Tax code

The solution to IRS incompetence is to simplify the tax code

(Jonathan Ernst/Reuters)

Daniel J. Pilla challenges the oft-repeated assertion that the IRS operates on “1960s technology” and needs billions of dollars in additional funding to modernize its systems. But, as he points out, he already does a lot of high-tech stuff and wants to do more:

Knowing this, remember my questions about IRS technology capabilities and the answers are clearly obvious. The IRS is most certainly not using 1960s technology; it’s just outdated. He spent tens of billions of dollars just since 2000 only upgrading computers. Now these systems include the power to track you around the internet with facial recognition software.

All this and the agency is still a “train accidentaccording to Chris Edwards of the Cato Institute.

Edwards reviewed the annual report of the IRS Taxpayer Advocate Service and found some truly dismal results from the IRS. The agency only answers 11% of incoming calls, takes 45 days to process correspondence and ended the 2021 tax season with a backlog of 35 million returns, according to the report.

The report indicates that some computer systems are truly obsolete. But, according to Pilla, these are clearly not all, and that alone is not enough to explain why the IRS is perpetually unable to perform its duties adequately.

Edwards adds that Congress has seen fit to add more tasks to the IRS’ plate, even though it’s not good at doing what it’s supposed to do now. The U.S. bailout changed several parts of the tax code that affect ordinary tax filers, and “each change in the law can generate millions of queries from confused taxpayers, which in turn consumes more tax resources. ‘IRS in response,’ writes Edwards.

The IRS is clearly a badly run organization, and badly run organizations shouldn’t be rewarded with more money. This is especially true if this organization “works steadily toward its goal of having real-time access to all of the personal data of every American,” as Pilla writes.

It is foolish to think that we are one infusion of tax money away from becoming a model of efficiency. The bureaucrats who run the agency will always tell Congress that they don’t have enough money, and there’s a certain learned institutional helplessness that goes into that. If the agency actually improved its processes and served taxpayers better, its case for funding increases would weaken.

The ultimate solution to the problem of IRS incompetence is to make the agency less important by simplifying our infinitely complex tax code. Filing a tax return doesn’t have to be a dreadful, confusing experience. Every twist on every tax form is a new opportunity for the IRS to screw something up. They have demonstrated their incompetence for years. It’s time to stop giving them so many chances.

With a simpler tax code, tax collectors would have less to do, which is better for them and better for us.

Dominic Pino is a William F. Buckley Fellow in Political Journalism at the National Review Institute.