The IRS had spent approximately $16.5 billion, or 64 percent, of its Inflation Reduction Act funding as of March 31, 2026, according to an audit by the Treasury Inspector General for Tax Administration.
The IRS initially received $79 billion in supplemental funding under the Inflation Reduction Act of 2022. Congress subsequently reduced the funding by $53.4 billion, leaving $26 billion available through September 30, 2031.
The largest spending category was $7.7 billion for employee compensation, followed by $5.4 billion for contractor advisory and assistance services. The IRS had cancelled 167 IRA-related contracts, having already paid $784 million before cancelling them. The agency is holding an additional $8 million in unliquidated obligations for costs already incurred but not yet paid.
In a separate audit, the inspector general examined how the IRS processes reports of threats and assaults against employees. Between October 2022 and August 2025, the IRS reported over 1,800 cases involving a threat or assault against an employee.
The agency's Office of Employee Protection met its one-day requirement for marking taxpayer accounts with a Potentially Dangerous Taxpayer indicator in 96 percent of casesโ1,730 of 1,826 cases. The remaining 71 had acceptable reasons for delay or involved errors or assignment issues.
However, the audit found gaps in employee training. IRS employees at eight offices interviewed did not know they were required to notify the Treasury Inspector General's Office of Investigations about threats or assaults. The sites visited also did not display guidance on reporting procedures.