Joe Biden's IRS Commissioner nominee, Daniel Werfel promises not to increase tax audits on businesses and households earning less than $400,000 annually if he is approved as the IRS commissioner. Werfel in his prepared presentation makes a number of other commitments geared at overhauling the troubled agency in anticipation of questions from the Senate Finance Committee ahead of his confirmation hearing on Wednesday.
Werfel was proposed by President Joe Biden to lead the Internal Revenue Service, which will receive a significant funding boost from the Inflation Reduction Act, which Congress passed in August, totaling almost $80 billion over the next 10 years. Noting the act's impact on the federal tax collector, Werfel states that "People justifiably expect a more contemporary and high-performing IRS."
Werfel asserts that he will be "unyielding in pursuing my true north to build public trust" while proposing to update the agency's technology, reduce its paperwork burden, and audit high-income earners.
Werfel, 51, who oversaw BCG's international public sector business, was proposed to succeed Charles Rettig. Rettig, who was chosen by President Donald Trump to oversee the agency, resigned in November after his five-year term came to an end. In the interim, a commissioner has been in charge.
Werfel will also have to deal with the controversy that has been stoked by opponents of the extra financing, who have misrepresented how the new law would impact middle-class taxes and the IRS. A total of $46 billion was allotted for enforcing tax rules, with the remaining funds going for taxpayer services, operational assistance, and corporate system modernization.
Republicans have made unsupported claims that the agency would use the increased funding to assemble a force of armed tax officers.
As House Republicans began their dominance by adopting a bill last month that would revoke the money, keeping with a campaign pledge, disapproval of the agency rose to unprecedented heights. The bill hasn't moved forward in the Senate and isn't likely to go to Biden, who has vowed to veto it.
The hearing "promises to be a doozy," according to Janet Holtzblatt, a senior fellow at the Urban-Brookings Tax Policy Center. This is because the IRS is one of the least liked government organizations in the country. This will be the first significant IRS hearing since the Inflation Reduction Act increased its budget by $80 billion.
Conservative criticism of Werfel appeared to be more focused on the Biden administration's initiatives to increase financing for the organization. Werfel should anticipate dealing with a number of managerial issues, according to tax experts.
If Werfel were to be hired, according to Caroline Bruckner, a tax professor at the Kogod School of Management at American University, he would have to deal with the IRS's enormous labor issues brought on by attrition, an aging workforce, and a generally bad reputation.
According to Bruckner, the upcoming generation of accountants does not want to work with the IRS. She continued, "Transparency as a leader will go a long way to attract the greatest personnel, particularly with Millennials and Gen-Z workers who will be the future of the workforce."
Bruckner cited a Stanford University study that revealed the IRS selected Black people to be audited at a rate that was up to 4.7 times higher than that of non-Black taxpayers. "This is a leadership challenge," she added, adding that the upcoming workforce is concerned about these issues.
Werfel will have to justify how the organization could use its additional funding, according to Robert J. Kovacev, a federal tax lawyer with Miller & Chevalier in Washington.
I believe that $80 billion gives the IRS options for improvement that they previously lacked, the man stated. "They might use it to invest in new technology or hire new revenue agents to make it more equitable and effective."
Werfel was proposed by President Joe Biden to lead the Internal Revenue Service, which will receive a significant funding boost from the Inflation Reduction Act, which Congress passed in August, totaling almost $80 billion over the next 10 years. Noting the act's impact on the federal tax collector, Werfel states that "People justifiably expect a more contemporary and high-performing IRS."
Werfel asserts that he will be "unyielding in pursuing my true north to build public trust" while proposing to update the agency's technology, reduce its paperwork burden, and audit high-income earners.
Werfel, 51, who oversaw BCG's international public sector business, was proposed to succeed Charles Rettig. Rettig, who was chosen by President Donald Trump to oversee the agency, resigned in November after his five-year term came to an end. In the interim, a commissioner has been in charge.
Werfel will also have to deal with the controversy that has been stoked by opponents of the extra financing, who have misrepresented how the new law would impact middle-class taxes and the IRS. A total of $46 billion was allotted for enforcing tax rules, with the remaining funds going for taxpayer services, operational assistance, and corporate system modernization.
Republicans have made unsupported claims that the agency would use the increased funding to assemble a force of armed tax officers.
As House Republicans began their dominance by adopting a bill last month that would revoke the money, keeping with a campaign pledge, disapproval of the agency rose to unprecedented heights. The bill hasn't moved forward in the Senate and isn't likely to go to Biden, who has vowed to veto it.
The hearing "promises to be a doozy," according to Janet Holtzblatt, a senior fellow at the Urban-Brookings Tax Policy Center. This is because the IRS is one of the least liked government organizations in the country. This will be the first significant IRS hearing since the Inflation Reduction Act increased its budget by $80 billion.
Conservative criticism of Werfel appeared to be more focused on the Biden administration's initiatives to increase financing for the organization. Werfel should anticipate dealing with a number of managerial issues, according to tax experts.
If Werfel were to be hired, according to Caroline Bruckner, a tax professor at the Kogod School of Management at American University, he would have to deal with the IRS's enormous labor issues brought on by attrition, an aging workforce, and a generally bad reputation.
According to Bruckner, the upcoming generation of accountants does not want to work with the IRS. She continued, "Transparency as a leader will go a long way to attract the greatest personnel, particularly with Millennials and Gen-Z workers who will be the future of the workforce."
Bruckner cited a Stanford University study that revealed the IRS selected Black people to be audited at a rate that was up to 4.7 times higher than that of non-Black taxpayers. "This is a leadership challenge," she added, adding that the upcoming workforce is concerned about these issues.
Werfel will have to justify how the organization could use its additional funding, according to Robert J. Kovacev, a federal tax lawyer with Miller & Chevalier in Washington.
I believe that $80 billion gives the IRS options for improvement that they previously lacked, the man stated. "They might use it to invest in new technology or hire new revenue agents to make it more equitable and effective."
