Unpacking the IRS: Q & A With Tax Law Professor Leigh Osofsky

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Professor Leigh Osofsky teaches courses addressing various aspects of taxation and policy. Before joining the Miami Law faculty, she was an acting assistant professor of tax law at New York University. She clerked for the Honorable Pierre Leval on the United State Court of Appeals for the Second Circuit and worked as a tax attorney at Fenwick & West LLP, specializing in tax transactional planning and as counsel in complex tax litigation matters. Her scholarship sits at the intersection of tax administration and administrative law.

Professor Leigh Osofsky


What are the challenges facing the Internal Revenue Service?

The Internal Revenue Service is severely underfunded, relative to its workload.  The IRS is not only tasked with enforcing the tax law to ensure that all taxpayers pay their fair share of taxes.  It is also tasked with assisting taxpayers in understanding their taxpaying obligations.  As a result of steady budget cuts over the past decade, combined with plans by the current administration to make significant, additional cuts to the IRS budget, the IRS simply does not have the resources to carry out all of its tasks.

What is the future of tax administration?

The IRS has to continue to find ways to innovate in order to do more with less.  This means continuing to develop its technology to make as much of its enforcement automated as possible (through the use of automatic inquiries being sent to taxpayers as a result of errors on the taxpayers’ tax returns).  The IRS is also always continually developing its informational technology to make the best possible use of its resources, for instance by honing audit formulas so that it is targeting the right taxpayers.  On the assistance side, the future is also in automation and technology, to ensure that the IRS is interacting with taxpayers in the most efficient ways possible. This might mean partnering with online tax preparation companies in order for the IRS to be able to interact with taxpayers in real time to get them the assistance (and provide them the compliance reminders they need) at the best possible times.  

What changes are needed?

In order to continue to enforce the law, serve taxpayers, innovate, and protect taxpayers' personal information from cyber-attacks, the IRS will need a step-up, not down, in resources.  The IRS is an extremely efficient organization (raising approximately $4 in revenue for every additional dollar in IRS funding).  It serves as the lifeblood of the rest of government, and it will need continued support to do its job.  At the same time, the Taxpayer Advocate’s work on behalf of taxpayers is necessary to ensure that the IRS’s zealous enforcement of the tax law continues to be consistent with public values and public support.