Creating New Computer Programs to Enforce Obamacare May Be Difficult for IRS

By Susan Jones | June 4, 2013 | 5:43 AM EDT

Treasury Inspector General for Tax Administration J. Russell George testifies before a House Appropriations subcommittee on Monday, June 3, 2013. (AP Photo/Charles Dharapak)

( – Is the Internal Revenue Service up to the task of ensuring compliance with the Affordable Care Act?

J. Russell George, the Treasury Inspector General for Tax Administration, told Congress on Monday that “the IRS is doing what it needs to do” to implement Obamacare.

“That said, the IRS has to create many, many new computer programs, and historically, they have had trouble instituting new computer programs for implementing tax law changes. So that is a risk,” George admitted.

If the player does not load, please check that you are running the latest version of Adobe Flash Player.

In testimony before a House appropriations subcommittee, George said the agency needs more money.

“And in all candor, unless the IRS receives additional resources in order to implement the ACA (Affordable Care Act), they truly -- it's a zero-sum game. They're going to have to make very difficult choices in terms of customer service, in terms of enforcement, in order to take on this huge responsibility that they have been presented with.”

George was responding to a question from Rep. Mario Diaz-Balart (R-Fla.), who asked how he’s supposed to feel good about giving the IRS a new, complicated mission to make sure all Americans purchase health insurance or else pay a fine.

“And will they be able to determine who gets fined and who doesn’t?” Diaz-Balart asked. “Could you please tell me how I should be able to feel good about that?”

George said the inspector-general’s office so far has conducted two reviews “looking at steps that the Internal Revenue Service is taking to prepare for the implementation of the Affordable Care Act, and thus far our reviews have been positive, that the IRS is doing what it needs to do in order to gear up for this.”

Rep. Ander Crenshaw (R-Fla.), the subcommittee chairman, noted in his opening statement that “$10 billion – that’s ‘b’ as in billion -- in hard-earned taxpayers’ money gets appropriated every year to the IRS to conduct its operations. And before Congress spends one more dime on the IRS, we need to know how it spends the money it receives already. We need to know what safeguards the IRS has in place, or plans to put in place, to make sure the funds are used in a legal and appropriate way and are not wasted, poured down the drain like we just learned.”

Crenshaw was referring to reports that the IRS spent about $50 million on at least 220 conferences for thousands of employees between 2010 and 2012.

“And so now we learn of the flagrant waste of taxpayers' dollars on conferences and videos,” Crenshaw said. “And the money came in part from the unused funds from the IRS enforcement budget at the same time the IRS was asking for more money for enforcement so they could catch the so-called tax cheats.”

The IRS’s fiscal 2014 budget request is $12.9 billion, a billion more than it requested for 2013.

Crenshaw noted that $440 million of the fiscal 2014 request is to implement the Affordable Care Act.

Even without the targeting of conservative groups and the wasteful spending on conferences, the IRS budget request “was going to be a challenge,” Crenshaw said, given that the “subcommittee has limited money.”

“So we're going to have to think very carefully about the amount of money that we provide to the IRS. Now nevertheless, I think we know this, we need to fund this agency so it can accurately answer questions from businesses and individuals about tax matters. It needs to produce tax forms and instructions that promote compliance. It's got to process tax returns in a timely manner, and it's also got to investigate the criminals that are committing tax fraud.

“However, we cannot in good conscience -- cannot in good conscience continue -- continue to provide hard earned taxpayers' dollars to the IRS and have them use those funds to abuse the rights of American citizens. And we can't continue to provide the IRS with money and watch them so flagrantly waste those dollars.”