Tax News Update    Email this document    Print this document  

February 15, 2023
2023-0287

Senate Finance holds Werfel IRS Commissioner hearing

The Senate Finance Committee's February 15 hearing on the nomination of Daniel Werfel to be IRS Commissioner focused, as expected, on Republican concerns that the Inflation Reduction Act (IRA) $80 billion funding boost will go unchecked and exacerbate the potential for the IRS to infringe on taxpayers' rights, as well as bipartisan interest in how to modernize the agency. Werfel, who led the agency in an acting capacity in 2013, was generally amenable to coordination with Congress on the spending plan while cautioning that he would want to discuss that and other decisions with IRS employees if confirmed. Some Republican members expressed support for his nomination and the general expectation is it will move forward.

The IRA funding increase has been a political issue since it was proposed and through the 2022 campaign season. Shortly after taking the majority, House Republicans approved a bill to roll it back. Chairman Ron Wyden (D-OR) took the criticism head on, saying, "the IRS is getting the resources it needs to go after tax cheating by the big guys — the wealthy and corporations. There are members who oppose that effort, and I get that they want to deflect and distract. That's why you're hearing these wild, made-up fantasies about 87,000 agents armed with rifles, busting down people's doors. If you don't want to engage on the real issue, which is tax cheating by the wealthy and corporations, you change the channel and talk about something else."

Ranking Member Michael Crapo (R-ID) said the IRA's supplemental billions could result in government waste because of a lack of accountability and guardrails, meaning the next Commissioner will shoulder the burden for outcomes and planning. He also cited inconsistency in rulemaking, saying, "Recently, the IRS simply overlooked statutory deadlines for implementing new laws, including third-party network reporting and EV tax credits. These delays seem conspicuous given that other recent and complex tax changes, including the amortization of R&D expenses, corporate book minimum tax, and stock buyback excise tax all took effect without necessary guidance."

Additional details are available in the attached Tax Alert.

———————————————

Contact Information
For additional information concerning this Alert, please contact:
 
Washington Council Ernst & Young
   • Any member of the group, at (202) 293-7474.

———————————————
ATTACHMENT

IRS Commissioner hearing

 

The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

 

Copyright © 1996 – 2024, Ernst & Young LLP

 

All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.

 

EY US Tax News Update Master Agreement | EY Privacy Statement