Cutting costs comes with a cost.

For Marketplace, I'm Novosafo in for David Brancaccio.

We're continuing to follow reports that the Trump administration has fired more than 6,000 workers at the IRS,

many of them in collections and enforcement.

Those job cuts come with their own costs. They have to do with what in business

is called return on investment. Marketplace's Justin Hoe reports. A few years ago, Nathan Hendren,

an economics professor at MIT, found that when the IRS audits somebody, it costs the agency

roughly $6,000 to $7,000 on average. And when it audits

people with higher incomes, those audits get a little more complicated and we end up spending just over

$10,000 on those audits. But Hendren also looked at how much the IRS receives when it does an audit.

Turns out, for people on the bottom half of the income spectrum, the IRS pretty much breaks even.

And for those with the highest incomes?

Every dollar we spend delivers more than $12 in revenue back to the U.S. Treasury.

Hendren says that's not only because audits pull in lost revenue.

It's also because of what happens next.

Those people end up changing their ways going forward and you deliver back a lot more revenue to the government,

even in the future years.

Another factor pushing up the IRS's return on investment,

the basic taxpayer services it provides, says Nina Olson,

executive director of the Center for Taxpayer Rights.

Everything from the IRS publishing publications and forms to answering

the phones on tax law questions to processing returns. Olson says those services help the IRS take

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