Partisan Cronies and IRS Worker Tax Cheats Are Undermining the Agency’s Credibility
It’s Time to Clean House at the IRS by Eliminating the Rogue Pass-Through Audit Unit
By Chuck Flint, Executive Director of the Alliance for IRS Accountability
It’s Tax Season, and once again, the IRS is proving why it remains America’s least favorite federal agency.
Senator Joni Ernst’s recent letter to Treasury Secretary Scott Bessent exposes the glaring hypocrisy of the tax collection behemoth: while the IRS targets everyday taxpayers with aggressive audits and invasive enforcement actions, more than 850 current IRS workers continue to collect government paychecks despite collectively owing millions in back taxes.
But the corruption doesn’t stop there. Under the Biden administration, the IRS created a rogue pass-through audit unit, bypassing Congress and duplicating existing processes—all while wasting taxpayer money. And who’s running the show? None other than Holly Paz, a central figure in the infamous Lois Lerner Tea Party IRS targeting scandal.
Rogue Agency with a Partisan Playbook
The pass-through unit operates outside the IRS’s traditional structure, making it a prime vehicle for partisan and politically motivated audits. This shadowy team—housed within Paz’s Large Business and International (LB&I) Division at the IRS—enforces arbitrary tax rulings, creating compliance confusion for law-abiding businesses and partnerships. As Senator Ernst notes, Paz’s auditors even use a new, taxpayer-hostile template for information requests—ominously dubbed “The Art of the IDR” (Information Document Request)—treating taxpayers as guilty until proven innocent.
Paz’s involvement makes it clear that the IRS has learned nothing from its past sins of political targeting. She was directly involved in the Tea Party scandal, during which conservative groups were systematically denied tax-exempt status at Lerner’s direction. The fact that Lerner’s disciple now oversees a powerful audit team demonstrates how unchecked the IRS remains.
IRS Tax Cheats on the Federal Payroll
While everyday Americans face mounting penalties and interest for late payments, the IRS is harboring thousands of tax delinquents on its own payroll. According to a July 2024 watchdog report, more than 5,800 current and former IRS employees and contractors collectively owe approximately $50 million in back taxes. Even more outrageous, the agency has rehired nearly 300 employees who were terminated for criminal misconduct, unauthorized access to taxpayer information, and other serious infractions.
How can taxpayers have confidence in a system where the tax collectors are tax dodgers? The IRS can’t be trusted to audit small businesses and family partnerships when it refuses to hold its own employees accountable.
AIA’s Call to Action: Terminate Paz and Shut Down the Pass-Through Unit
The Alliance for IRS Accountability is calling for immediate action:
Terminate Holly Paz. Her involvement in past political targeting and current oversight of the LB&I pass-through unit disqualifies her from public service.
Eliminate the Pass-Through Unit. This duplicative, partisan audit team is a clear example of bureaucratic abuse of power. President Trump, Secretary Bessent, and DOGE must “delete” this team.
Enforce Equal Tax Compliance Standards. The IRS must be held to the same standards it applies to taxpayers. Every IRS employee and contractor who owes back taxes should be terminated or placed on unpaid leave until they pay their fair share.
No More IRS Power Grabs
The pass-through audit team is just one of the many examples of the IRS’s growing, unchecked power. From its unlawful Direct File program—created without congressional authorization—to wasteful “modernization” spending on outdated IT systems, the IRS acts with impunity. President Trump, Secretary Bessent, DOGE, and Congress must rein in the IRS and restore accountability.
The Alliance for IRS Accountability will continue to fight for taxpayers and small businesses by exposing the agency’s corruption, advocating for structural changes, and holding Washington accountable.
RESOURCES
Ernst Outlines Major Reform to America’s “Least Favorite Government Agency”
The Office of U.S. Senator Joni Ernst (R-IA)
March 25, 2025
Senator Joni Ernst wants IRS workers, contractors to pay back up to $46M in taxes they owe
New York Post
March 25, 2025
Editorial: The IRS’s next target should be its own tax-dodging workforce
New York Post
March 25, 2025