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1 1 (June 6, 2023)

handle is hein.crs/govelwc0001 and id is 1 raw text is: Congressional ____ aResearch Service Changes to IRS Funding in the Debt Limit Deal Updated June 6, 2023 President Joseph Biden and House Speaker Kevin McCarthy brokered a deal that would reduce federal spending in FY2024 and FY2025 and raise the statutory debt limit through January 2025. P.L. 118-5, the Fiscal Responsibility Act of 2023, enacts many of the components of the deal between the President and the Speaker. President Biden signed the bill into law on June 3, 2023. If lawmakers had not raised the statutory debt limit by June 5, 2023, according to Treasury Secretary Janet Yellen, the debt limit would bind and the Treasury would have legal authority only to expend as much as it collects in revenue. Among the cuts to federal spending this deal makes are reductions in federal outlays for the Internal Revenue Service (IRS). Background Normal IRS Appropriations Congress funds the IRS through annual appropriations for four primary categories of spending: 1. Enforcement ($5.4 billion in FY2023), which refers to enforcing the tax code; 2. Operations support ($4.1 billion in FY2023), which refers to the agency's ordinary operating expenses (including information systems); 3. Taxpayer services ($2.8 billion in FY2023), which refers to efforts to help taxpayers voluntarily pay their tax burdens in a timely fashion and resolve taxpayer issues; and 4. Business system modernization ($0 in FY2023), which refers to the ongoing effort to update the IRS's legacy information technology systems. IRS-Related Funds in the Inflation Reduction Act Congress provided the IRS with $78.9 billion in mandatory funding from FY2022 to FY2031 in P.L. 117- 169, commonly referred to as the Inflation Reduction Act. The law dedicated $45.6 billion of that amount to enforcement, $25.3 billion to operations support, $3.2 billion to taxpayer services, and $4.8 billion to Congressional Research Service https://crsreports.congress.gov IN12172 CRS INSIGHT Prepared for Members and Committees of Congress

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