Report: IRS enforcement steps harmed by budget cuts

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IRS officials say budget cuts are undercutting the agency's ability to go after tax cheats.

A report by Inspector General J. Russell George says that tax collections from enforcement actions dropped by 9 percent in the 2012 budget year, to a little more than $50 billion. It was the second year in a row that enforcement collections dropped.

In 2011, enforcement revenue dropped by more than $2 billion. Last year, it dropped by $5 billion more. The report out  yesterday says that during this same period, the IRS was opening more delinquent taxpayer accounts than it was closing.

The report says the IRS has lost about 8,000 jobs since 2010. This comes as the agency is taking on big new responsibilities implementing President Obama's new health care law.