IRS Hiring Ban Proposed for Individuals with 'Seriously Delinquent' Tax Debts; Annual Checks Required

This bill, titled the "Audit the IRS Act," aims to prevent individuals with significant, unresolved tax debts from working at the Internal Revenue Service. Specifically, it makes anyone with a "seriously delinquent tax debt" ineligible for employment or continued service as an officer, employee, or contractor with the IRS. The core idea is to ensure that the agency responsible for tax collection has staff who are themselves compliant with tax laws.

Defining 'Seriously Delinquent'

So, what exactly counts as "seriously delinquent"? According to the bill, it's an unpaid federal tax debt where the IRS has already gone so far as to file a notice of lien (under Section 6323 of the tax code). However, it's not a blanket ban on anyone who owes taxes. The bill specifically excludes debts that are being paid on time through an installment agreement (Section 6159) or an offer in compromise (Section 7122). It also excludes debts where the collection process is legally paused because the individual has requested a Collection Due Process hearing (Section 6330) or is seeking relief as an innocent spouse (Section 6015). Essentially, if you owe taxes but are actively working within the system to resolve it according to established procedures, this rule wouldn't apply.

Putting Checks in Place

The bill mandates a system for verification. The IRS Commissioner would be required to check all current employees within six months of the bill's enactment and then repeat this check annually. For potential new hires, this verification must happen before they are brought on board. Think of it as adding another layer to the background check process specifically focused on this tax compliance standard. To ensure this runs smoothly, the Office of Personnel Management (OPM) is tasked with creating the necessary regulations to implement these checks within the IRS.

Real-World Impact

The most direct impact falls on individuals with outstanding tax liens who might be seeking employment at the IRS or are already employed there. They would need to resolve their tax situation to meet the criteria outlined in the exclusions (like setting up a payment plan) to become or remain eligible. For taxpayers, the intended effect is increased confidence that IRS personnel meet basic tax compliance standards. The practical challenge for the IRS will be implementing these checks efficiently and accurately across its workforce and applicant pool, guided by the forthcoming OPM regulations.