IRS expects $500 billion revenue drop due to filings

The IRS is preparing for a potential $500 billion reduction in tax revenue this year. This is largely due to a growing number of taxpayers who are expected to skip filing their taxes. The situation follows recent layoffs announced by the Department of Government Efficiency, which is aimed at downsizing the IRS by nearly 20 percent. Reports indicate that many individuals believe that IRS audits will decrease, leading them to forgo tax filings. There's been an increase in online discussions with people openly stating their intention not to pay taxes. The IRS's ability to enforce tax laws has been weakened as the agency has cut back on hiring for taxpayer services and enforcement roles. The IRS currently has around 90,000 employees. Officials from the Treasury Department and the IRS now predict that tax receipts could drop by more than 10 percent compared to last year. This potential decline in revenue is significantly large, considering that last year's military budget was approximately $820 billion. Former IRS leaders have expressed concerns over the impact of budget cuts. They warn that reducing the workforce could make the IRS less effective in collecting taxes. Additionally, unusual circumstances, like the recent wildfires in Los Angeles, could lead some taxpayers to delay their filings. While these factors might contribute to a decrease in revenue, experts stress that they do not fully explain the expected $500 billion drop.