HR-9736-119
Referred to the House Committee on Appropriations.
Sponsored by Suzan DelBene (D-WA)
What it does
This bill would appropriate approximately $80.2 billion in additional funding to the Internal Revenue Service over six fiscal years (2026–2031), divided across four categories: tax enforcement ($45.6B), taxpayer services ($9.6B), technology and operations support ($25.4B), and business systems modernization ($3.1B). It would also require the IRS Commissioner to submit biennial reports to Congress detailing plans and progress toward shifting audit and enforcement resources toward high-income individuals and large corporations, and require the Treasury Inspector General for Tax Administration to independently evaluate those plans.
Who benefits
Compliant taxpayers who bear a disproportionate share of the tax burden relative to those who underreport — they would benefit if the "tax gap" (estimated by the IRS at roughly $600 billion annually) is reduced. Lower- and middle-income taxpayers who rely on IRS customer service and pre-filing assistance. IRS employees who would gain resources, training, and modernized tools. Technology contractors and vendors hired to overhaul IRS systems. State and local governments that rely on federal revenue sharing. Taxpayers who currently face long wait times or processing delays due to understaffing.
Who is hurt
High-income individuals and large corporations, who are explicitly targeted for increased audits and enforcement under the bill's reporting requirements, and who may face higher compliance costs. Tax attorneys, accountants, and advisors whose clients are in those groups may face increased adversarial proceedings. Taxpayers of any income level who are audited incorrectly due to expanded enforcement activity. Businesses that compete with IRS technology contractors for specialized talent. Taxpayers broadly, if increased enforcement is perceived as intrusive or if audit error rates rise with rapid hiring.
Supporters argue
Supporters argue that the IRS has been chronically underfunded for over a decade — its budget fell roughly 20% in inflation-adjusted terms between 2010 and 2022 — leaving it unable to audit complex returns filed by wealthy individuals and large corporations. They contend that the IRS's own estimates show a $600 billion annual tax gap, and that independent analyses, including from the Treasury Department, project that robust enforcement funding could generate several dollars in revenue for every dollar spent. They further argue that technology modernization is overdue, as the IRS still relies on systems dating to the 1960s, causing processing failures and poor taxpayer service.
Opponents argue
Opponents argue that large, rapid increases in IRS enforcement funding risk expanding audits to ordinary taxpayers despite stated intentions to focus on high earners — pointing to IRS data showing that lower-income filers claiming the Earned Income Tax Credit have historically faced disproportionately high audit rates relative to their share of the tax gap. They contend that revenue projections from enforcement spending are speculative and that prior IRS modernization efforts, including multi-year IT overhauls, have a documented history of cost overruns and failed deliverables. They further argue that the bill's reporting requirements provide insufficient congressional oversight to ensure funds are spent as directed.