Warren, King, Kaine, Whitehouse Lead 25 Senators in Introducing Bill to Fund the IRS, Crack Down on High-Dollar Tax Dodgers

Warren, King, Kaine, Whitehouse Lead 25 Senators in Introducing Bill to Fund the IRS, Crack Down on High-Dollar Tax Dodgers

The Stop Cheaters Act would raise $1 trillion over a decade by providing the IRS with the necessary resources to modernize taxpayer services and ensure the wealthy pay what they owe in taxes.

Text of Bill (PDF) | One-Pager (PDF)

Washington, D.C. - U.S. Senators Elizabeth Warren (D-MA)-a member of the Senate Finance Committee-Angus King (I-ME), Tim Kaine (D-VA), and Sheldon Whitehouse (D-RI) introduced the Stop Corporations and High Earners from Avoiding Taxes and Enforce the Rules Strictly (Stop CHEATERS) Act, a bill to restore and revitalize the IRS with additional funding for tax enforcement, technology operations support, systems modernization, and taxpayer services like free taxpayer assistance. The bill is projected to raise approximately $1 trillion over a decade, given the extent of tax evasion among high earners and the positive impact of improved services to help lower- and middle-income taxpayers file their taxes.

Right now, America misses out on billions of dollars owed by high earners who evade paying the taxes they owe. Prior to receiving funding through the Inflation Reduction Act, the IRS suffered from decades of chronic underfunding, leading the agency to disproportionately audit lower income earners. As a result, it is estimated that corporations and high-income individuals with access to high-level accountants - have been able to evade the taxes they owe, contributing to $1 trillion in lost revenue. However, instead of supporting the IRS's efforts to ensure the wealthy pay their fair share, Congressional Republicans have slashed staff at the IRS and rescinded much of the IRS's funding from the Inflation Reduction Act.

This legislation would allocate over $83 billion to the IRS over the next decade to enable tax auditors to enforce the tax code fairly across the board and at all income brackets and provide crucial services to taxpayers. The Yale Budget Lab estimates that this change will raise approximately $1 trillion in net revenue over a ten-year window, meaning that for every dollar invested by this bill, the federal government will gain approximately $13 in gross revenue.

"For decades, billionaires and giant corporations have made tax evasion their hobby, and Republicans have enabled them by gutting the IRS," said Senator Warren. "Enough is enough. It's time to fund the IRS and make the rich pay their fair share."

"As Congress negotiates ways to fund much-needed policy priorities and address our growing national debt, there is one common sense solution that should have unanimous bipartisan support: let's enforce the tax laws already on the books," said Senator King. "I was proud to advocate for the Inflation Reduction Act's investment in the IRS. Now that much of this investment has been rescinded, our legislation will make sure the IRS has the resources it needs to confront the tax gap and ensure that our tax enforcement professionals are focused on the high-income earners who account for the most tax avoidance. This is a serious problem with an easy solution; let's pass this legislation and make sure every American pays what they owe in taxes."

25 Senators joined Senators Warren, King, Whitehouse, and Kaine in introducing the bill, including Senators Wyden, Schumer, Bennet, Blumenthal, Blunt Rochester, Booker, Coons, Duckworth, Durbin, Fetterman, Gallego, Heinrich, Hickenlooper, Kim, Lujan, Merkley, Peters, Sanders, Schatz, Shaheen, Van Hollen, Warner, Welch, Klobuchar, and Smith.

More specifically, the Stop CHEATERS Act would:

• Restore and revitalize the IRS and ensure it is properly funded by providing over $83 billion in mandatory funding through Fiscal Year 2031, reversing both the rescissions to IRA funding and discretionary spending cuts to the IRS budget. This funding would be divided into four spending buckets and provide the following:

  • $45.6 billion for Enforcement to audit wealthy taxpayers and large corporations, pursue criminal investigations, and prevent financial crimes. The bill establishes a ramp-up period, increasing funding each year, allowing the IRS to gradually rebuild enforcement operations.

  • $25.4 billion for Technology and Operations Support to overhaul outdated technology and increase the agency's capacity to detect fraud and noncompliance.

  • $3.1 billion for Business Systems Modernization to improve, operate, and maintain internal systems.

  • $9.6 billion for Taxpayer Services to allow for pre-filing assistance and education, taxpayer advocacy services, and other forms of free taxpayer assistance.

• Instruct the IRS Commissioner to issue a report to Congress on the agency's plan to shift auditing and enforcement resources to high-income individuals and large corporations, a directive first launched under Commissioner Werfel in 2024. In addition, the plan must include efforts to recruit and retain skilled auditors for high-income individuals and large corporations that typically have complicated tax situations. The Office of the Treasury Inspector General for Tax Administration would be required to issue a report on the effectiveness of this plan.

The Stop CHEATERS Act is endorsed by the following organizations: Third Way, Progressive Policy Institute, Taxpayers for Common Sense, Committee for a Responsible Federal Budget, National Treasury Employees Union, AFL-CIO, American Federation of Teachers, SEIU, AFSCME, Americans for Tax Fairness, Americans for Financial Reform, Small Business Majority, Main Street Alliance, Tax the Greedy Billionaires, Groundwork Action, Take on Wall Street, Public Citizen, Patriotic Millionaires, P Street, and the Institute on Taxation and Economic Policy.

###