IRS says it must pay $70 million in employee bonuses

The embattled Internal Revenue Service said it is legally obligated to pay $70 million in bonuses to its unionized employees, despite the new budget constraints and the objections of lawmakers.

Sen. Charles Grassley, R-Iowa, sent a letter to acting IRS Director Daniel Werfel stating he does not believe the IRS is obligated to pay out the bonuses because of budget reductions caused by sequestration. Grassley pointed to an April directive for the Office of Management and Budget that stated “monetary awards should not be issued while sequestration is in place.”