Changes to IRS Funding in the Debt Limit Deal

President Joseph Biden and House Speaker Kevin McCarthy brokered a deal that would reduce federal spending in FY2024 and FY2025 and raise the statutory debt limit through January 2025. President Biden signed the bill into law on June 3, 2023.

If lawmakers had not raised the statutory debt limit by June 5, 2023, according to Treasury Secretary Janet Yellen, the debt limit would bind and the Treasury would have legal authority only to expend as much as it collects in revenue. Among the cuts to federal spending this deal makes are reductions in federal outlays for the Internal Revenue Service (IRS).