Tax News

CCH (cch.taxgroup.com) reports:

  The Senate Appropriations Committee on July 9 approved a proposed IRS budget of $12.15 billion for fiscal year (FY) 2010. The IRS budget is included in the proposed FY 2010 Treasury budget of $13.5 billion, which includes $152 million for the Treasury Inspector General for Tax Administration. The House Appropriations Committee approved the IRS's budget on July 7 (TAXDAY, 2009/07/09, C.1). Congress is expected to act on the budget before its August recess.

  The Senate Appropriations Subcommittee on Financial Services and General Government, chaired by Sen. Richard Durbin, D-Ill., approved the IRS and Treasury budgets on July 8. The proposed IRS budget exceeds the Service's FY 2009 budget by $550 million (5 percent) and increases the Obama administration's proposal by $26 million, the subcommittee reported in a July 8 news release. The House Appropriations bill provides $2.27 billion for taxpayer services; the Senate Appropriations Committee did not identify the funding for this category.

  The bill fully funds the administration's request of $7.1 billion for IRS enforcement, the subcommittee indicated. This represents a $387-million increase above the FY 2009 level. The budget provides $274 million for business systems modernization (BSM), approximately $20 million above the administration proposal, a spokesman for Durbin said. The IRS Oversight Board has highlighted BSM as an IRS weakness and recommended funding of $400 million (TAXDAY, 2009/07/08, I.3).

  The Senate bill also provides a 2.9-percent cost-of-living increase for federal employees. The administration has proposed a 2-percent increase. "The bill includes several provisions constraining the outsourcing of federal jobs to contractors," the subcommittee reported.

  By Brant Goldwyn, CCH News Staff