White House wants Congress to give IRS back promised Inflation Reduction Act funds

IRS got roughly $20 billion in funding through the Inflation Reduction Act, but congressional Republicans demanded cuts to this spending.

  • The White House wants Congress to reverse a big cut to the IRS’ multi-year modernization fund. Its 2025 budget request asks lawmakers to give back the roughly $20 billion in Inflation Reduction Act funds the IRS was counting on, to grow its workforce and modernize its legacy IT. The IRS got this funding through the Inflation Reduction Act, but congressional Republicans demanded cuts to this spending as part of last year’s debt ceiling negotiations. The White House plans to keep the IRS’ annual budget at current spending levels.
  • The Pentagon’s spending on military personnel will rise in 2025 even though the department plans to downsize some of its services. DoD is pushing for a 4.5% pay raise for service members and a 2% raise for its civilian workforce. The Pentagon also expects to fully fund its commissaries and increase the income eligibility threshold for basic needs allowance. These compensation increases partly explain why the Pentagon plans to spend more on personnel while cutting its active end strength.
  • The Biden Administration’s 2025 budget includes a military pay raise that’s quite a bit more robust than the one civilians would get. If Congress adopts it, it would be the third year in a row of military pay raises above 4%. Sustained increases at that level haven’t happened since the early years of the Iraq and Afghanistan wars. Overall, the administration is proposing $850 billion in DoD spending in 2025. That figure was set by last year’s Fiscal Responsibility Act.
  • The Defense Department is downsizing the Navy and the Army, but adds more troops to its reserve components. The Pentagon expects its total active end strength to drop by 7,800 service members in 2025 as the services continue to miss its recruiting goals. The reserve component, however, is projected to increase by 2,100 troops. The Army and the Navy expect their active end strength to be lower than what Congress authorized this year. The Air Force and the Marine Corps expect that their end strength will remain the same.
  • Spending on federal IT is not keeping up with inflation for 2025. The White House is requesting $75 billion for civilian agency IT in fiscal 2025, just a $700 million increase over the 2024 request. It would be smallest increase since 2013. The Office of Management and Budget says the Homeland Security Department would receive almost $2 billion more in 2025 than what it requested in 2024. The Energy Department would be another big winner, requesting $5.5 billion, which is an increase of $1.5 billion over 2024. Meanwhile, the Veterans Affairs Department would face more than a $2 billion reduction next year.
  • The Biden administration wants to boost cyber spending next year. Civilian agencies would spend $13 billion on cybersecurity activities under the White House’s 2025 budget request. That’s a big increase over the $11.8 billion in cyber spending forecast for this year. The budget request includes $1.7 billion for cyber programs at the Cybersecurity and Infrastructure Security Agency. The Department of Health and Human Services would also see big increases to its cyber programs, including $800 million to help hospitals improve their security practices.
  • Federal contractors will need to sign a new document if they want to keep selling software to the government. The Cybersecurity and Infrastructure Security Agency finalized the secure software development attestation form this week. The goal is to ensure agencies only use software that’s built following cybersecurity standards. The White House has told agencies to collect the form for all third-party software within six months of the form being finalized.
    (Biden administration takes step to ensure secure development practices - Cybersecurity and Infrastructure Security Agency)
  • The Biden administration is doubling down on plans to sell federal buildings that agencies no longer need. The White House proposed giving the federal government’s landlord, the General Services Administration, $425 million to right-size government real estate. GSA said the money in the 2025 budget proposal would go toward renovating federal buildings, and selling or disposing of underutilized properties. The agency said those funds would allow it to make better use of existing office space, and save money on expensive leases. The White House is also looking to give GSA broader authority to get rid of excess federal property.
  • The General Services Administration has hired a familiar face to take over a key office in its Technology Transformation Service. Lauren Bracey Scheidt is the new assistant commissioner for the Office of Solutions. Her first day was yesterday. As the new head of the Office of Solutions, Scheidt will oversee several governmentwide programs including FedRAMP, Login dot gov and Cloud dot gov. Scheidt has been with TTS since September 2021 when she joined as a product manager at 18F. She also has served as acting TTS deputy director and as acting TTS director. Most recently Scheidt was the senior advisor for delivery in the TTS front office.

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