According to the Congressional Budget Office, the Inflation Reduction Act slammed through by Democrats is going to hit middle-class working Americans hard in the wallet with $20 billion in new taxes at a time when they can least afford it.
(Video Credit: Fox News)
President Biden is set to sign the legislation today regardless of the harm it will reportedly inflict on a nation that was already staggering from the fallout over the pandemic and crushing inflation.
Biden had claimed that the act would not impact those making under $400,000. However, the CBO estimates that is not the case by a long shot. Not only is the middle-class set to get hammered with $20,000 billion in taxes over the next decade, but the 87,000 new IRS agents added to the agency, roughly doubling its force, will also allegedly be busy auditing those same struggling Americans.
The CBO is not even done scoring the bill yet. They do that in pieces. It did, however, score the impact of the IRS impact on middle-class taxpayers after an amendment from Sen. Mike Crapo (R-Idaho) sought to exempt those making under $400,000 from increased IRS scrutiny.
The amendment would have kept those making less than $400,000 from being targeted by new IRS hires. It was defeated when the bill passed in the Senate.
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The CBO’s conclusion echoes that of an earlier report from the Joint Committee on Taxation that determined that the $80 billion the bill will spend on IRS expansion will wind up targeting small business owners to pay for the legislation, not just the uber-wealthy and large corporations as Biden and Democrats have claimed.
Small business owners will reportedly be hit the hardest as a tidal wave of IRS auditors descends on entrepreneurs according to tax experts.
“Most small businesses are organized as pass-through entities — LLCs and S Corps,” James Lucier, who is the managing director of Washington-based policy research firm Capital Alpha, told the New York Post. “Proponents of increased auditing specifically say they want to target pass-through entities, which inherently means targeting small business and small business owners.”
“The IRS will have to target small and medium businesses because they won’t fight back,” commented Joe Hinchman, who is the executive vice president at the National Taxpayers Union Foundation. “We’ve seen this play out before … the IRS says ‘We’re going after the rich’ but when you’re trying to raise that much money, the rich can only get you so far.”
Today, Joe Biden will sign a bill that raises taxes on middle-class Americans, officially breaking his promise to not raise taxes on anyone making less than $400,000.
Remember that in November.
— RNC Research (@RNCResearch) August 16, 2022
The IRS will raise at least $20 billion in new tax revenues from the middle class, thanks to the bill Congress passed on Friday. That’s from the CBO. It’s a shakedown. Did anyone send their elected members to Washington to shakedown the middle class? I didn’t.
— Jimmy Patronis (@JimmyPatronis) August 15, 2022
When you vote to raise taxes, hire 87,000 new IRS agents, and make inflation worse, voters rightly have questions.
And Democrats have no answers.
— GOP (@GOP) August 16, 2022
The White House is contesting the assertion that the legislation will hurt lower- and middle-income Americans. They claim that the estimates don’t take into account how much the bill will offset costs for average Americans on items such as prescription drugs.
Treasury Secretary Janet Yellen has admitted that the newly expanded IRS foot soldiers could ramp up collections from middle-class taxpayers. She wrote a letter to the IRS commissioner directing “any additional resources … shall not be used to increase the share of small business or households below the $400,000 threshold that are audited relative to historical levels.” Many expect it to regardless of that letter and it appears to be an admission that more audits and taxes are coming to middle America.
Americans: hey we need a bill that makes it illegal for our representatives and their family to trade stock.
Congress: no but hey look we’re voting to raise your taxes!
— Kevin Sorbo (@ksorbs) August 15, 2022
“Anytime you get an IRS letter, it could take months or years to get it settled — we’re talking many thousands of dollars to address,” Daniel Bunn, who is the executive vice president at the Tax Foundation, told the New York Post. “Large companies have constant reviews and lawyers going through everything … small business doesn’t have the resources to fight back in the same way.”
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