More than 1,000 IRS employees violated the terms of the agency’s student loan repayment program, according to a new audit released Monday by the IRS inspector general.
The program was designed to help recruit and retain federal workers by paying down their outstanding student loan balances. Employees who receive the benefit are required to fulfill certain service obligations in return. The audit found that more than 1,000 of them did not.
The IRS inspector general’s report does not specify the total dollar amount improperly paid out, but the agency employs tens of thousands of workers and the program has been running for years. Inspector general audits of similar federal loan repayment programs have found millions of dollars in improper payments in past reviews at other agencies.
The findings are notable given that the IRS is the federal agency charged with enforcing tax compliance across the American economy, collecting trillions of dollars from individuals and businesses annually. The agency has broad enforcement powers, including the ability to garnish wages and seize assets from taxpayers who fail to meet their obligations.
Congressional Republicans have long argued that the IRS applies its enforcement authority unevenly, scrutinizing private citizens and small businesses while facing less accountability for its own internal compliance. Monday’s audit gives fresh ammunition to that argument.
Federal workers who receive student loan repayment assistance and fail to complete the required service period are generally supposed to repay the benefit. Whether the IRS sought repayment from the employees identified in the audit was not made clear in the initial report.
The Biden administration significantly expanded federal student loan repayment programs across agencies as part of broader efforts to boost federal hiring. Critics argued those expansions created compliance risks precisely because oversight mechanisms were not scaled to match the growth in participation.
The inspector general’s audit joins a growing list of findings from agency watchdogs documenting compliance failures inside the federal government.
