Aug 11, 2022 - Economy

Yellen tells IRS not to increase number of audits for middle class

Herb Scribner

US Treasury Secretary Janet Yellen speaks on the economy. — Treasury Secretary Janet Yellen speaks from Washington, D.C. Photo: Saul Loeb/AFP via Getty Images

Treasury Secretary Janet Yellen told the Internal Revenue Service in a letter Wednesday to avoid using any new funding from the Democrats' new health care and climate bill to increase the number of audits for middle-class Americans.

The big picture: Yellen's letter follows GOP charges that the Inflation Reduction Act, which adds about $80 billion to the IRS' budget over 10 years, will cause more audits for the middle class.

What she said: Yellen told IRS Commissioner Charles Rettig in a letter that any new personnel or auditors hired should not be used to increase the number of audits for small businesses or American households making less than $400,000 per year.

"This means that, contrary to the misinformation from opponents of this legislation, small business or households earning $400,000 per year or less will not see an increase in the chances that they are audited," she said in the letter.

What's next: The Democrat-controlled House still needs to approve the legislation, which passed the Senate last weekend.

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Yellen tells IRS not to increase number of audits for middle class

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