IRS on the chopping block on first day of legislative work under Speaker McCarthy

The House of Representatives is scheduled to vote on a bill Monday night that would cut more than $70 billion in Internal Revenue Service funding in an effort to prevent the agency from conducting new audits on Americans — fulfill the promise of newly elected Speaker of the House Kevin McCarthy forward by taking the needle.

The Family and Small Business Taxpayer Protection Act by Reps. Adrian Smith, R-Neb., and Michelle Steel, R-Calif., would roll back billions of dollars in funding for the IRS passed in the Inflation Reduction Act last year .

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Smith’s bill leaves in place funding for customer service and IT service improvements at the IRS, but cancels several categories of nonobligatory funding, including money that could be used to conduct any new audits of Americans. In total, it would return $72 billion in funds Congress approved for the IRS last year.

Internal Revenue Service federal building Washington, DC (istock)

The Inflation Reduction Act provided an $80 billion increase to the IRS over a 10-year period, and more than half of those funds were intended to help the agency fight tax evasion. In 2021, the Treasury Department estimated that $80 billion would be used to hire 87,000 new auditors and other staff. Republicans have said they will fight this aggressive expansion that would double the agency’s current size.

“The last thing the American people need right now is more audits from an out-of-control, bloated IRS,” Smith told Fox News Digital on Monday. “Inflation Act funding for the IRS would lead to the hiring of 87,000 new IRS employees tasked with collecting enough revenue to pay for the Democrats’ Green New Deal priorities.”

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Smith called it “unacceptable.”

“Our bill leaves in place funding for customer service and IT improvements because the IRS desperately needs reform, but protects middle-class families from audits they can’t afford,” Smith said.

Republican Leader Kevin McCarthy, R-Calif., is seen on the House floor after a vote in which he did not receive enough votes for Speaker of the House on Friday, Jan. 6, 2023. (Kent Nishimura/Los Angeles Times via Getty Images)

The vote is scheduled for Monday evening — just days after McCarthy, R-Calif., secured the House leadership after an intense 15-round vote battle that lasted all week.

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In an exclusive interview with Fox News Digital just days before the midterm elections, McCarthy vowed that if he were to become speaker of the House, protecting Americans from the IRS would be his first order of business.

“On day one, we’re going to abolish the 87,000 new IRS agents because we think the government should be there to help you, not chase you,” McCarthy said.

House Speaker Kevin McCarthy, R-Calif., celebrates after being sworn in in Washington, DC on January 7, 2022. (Nathan Posner/Anadolu Agency via Getty Images)

Also Monday evening, the House of Representatives will vote on the new package of rules that will govern the 118th Congress.

The package includes several measures intended to make it more difficult for Congress to spend money. It also requires 72 hours notice before voting on the new legislation, a three-fifths supermajority to approve raising the federal income tax rate and the formation of a task force to address House ethics reform.

The rules package also calls for the creation of a House Oversight subcommittee to investigate the origins of COVID-19, specifically mentioning the involvement of the US government in any for-profit research funding.

Fox News’ Peter Kasperowicz and Ronn Blitzer contributed to this report.

Brooke Singman is a political reporter for Fox News Digital. You can reach her at [email protected] or @BrookeSingman on Twitter.