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Report says sequester chopped thousands of IRS employees — but the IRS still collected more money

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WASHINGTON, DC - SEPTEMBER 17: Internal Revenue Service Commissioner John Koskinen (C) testifies before the House Oversight and Government Reform's Economic Growth, Job Creation, and Regulatory Affairs Subcommittee in the Rayburn House Office Building on Capitol Hill September 17, 2014 in Washington, DC. The Oversight and Government Reform Committee continues to investigate the IRS for targeting political groups applying for tax-exempt status for intensive scrutiny based on their names or political themes. Chip Somodevilla/Getty Images

A report from the Treasury Departments' Inspector General for Tax Administration says last year's sequester, those automatic cuts to government that took place under a bipartisan deal to help reduce spending, chopped nearly $1 billion from the IRS and forced thousands of IRS workers to be let go.

But still, the IRS managed to collect more money in 2013 than it did in 2012.

According to the report, the IRS budget dropped from $12.1 billion in fiscal year 2010, to $11.2 billion in fiscal year 2013 after the sequester. "Sequestration had a significant impact on the IRS's FY 2013 budget," the report said.

The IRS, led by Commissioner John Koskinen, has lost thousands of employees due to the sequester, but a report says it still collected more money in 2013. Chip Somodevilla/Getty Images

The number of full-time equivalent workers dropped over that same time period from 94,618 to 86,310, a reduction of almost 9 percent. About half of that drop in personnel happened between 2012 and 2013, and the number of enforcement personnel fell by more than 1,000 in 2013.

The report described this drop in money for the IRS as a "challenge," especially since the IRS has new responsibilities trying to implement ObamaCare.

But while the report said the IRS is challenged, it also said the IRS had increased tax collections in 2013, and hit a record-high $2.9 trillion. That's a 13 percent increase compared to the prior year.

It also said revenue from enforcement efforts also increased, to $53.3 billion from $50.2 billion. However, it said this increase was largely due to "several large appeals case settlements."

Republicans this year have tried to impose further cuts against the IRS, in retaliation for the IRS targeting scandal that saw officials question and delay tax-exempt applications from conservative groups. Back in July, the House voted to cut more than $1 billion from the IRS's tax enforcement budget, a cut of about one-fifth.

Those cuts were made as the House considered a spending bill that was later ignored when Congress passed a short-term funding bill for all of federal government, through mid-December. But more detailed language cutting the IRS could be approved later this year, when Congress tries to pass a bill for the rest of fiscal year 2015.

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