On Tuesday, newly appointed IRS Commissioner Danny Werfel assured taxpayers that the agency will utilize the incoming $80 billion to modernize, speed up, and bring “real-world improvements” to the tax system.
While he was being formally sworn in, Werfel said that, later this week, he would be releasing a Strategic Operational Plan detailing the agency’s allocation of funds from last year’s Inflation Reduction Act.
Werfel, who started working at the IRS in the middle of March, stated, “This is our time in history to overhaul the IRS.”
He said he has a lot of work to do to make sure the IRS is more efficient and effective so that it can serve taxpayers with world-class services.
The IRS plans to extend its online accounts so that individuals and professionals may deal with tax concerns electronically rather than via the mail and hire more workers to answer phones to reduce wait times.
Werfel was named by President Joe Biden to lead the IRS when it received the increased funds, causing great political uproar. Republicans have claimed that the IRS will use the additional funding to equip a roving band of tax collectors. They also worry that the IRS will target middle-class taxpayers for more auditing.
Upon being questioned by the Senate Finance Committee about how he planned to spend the agency’s massive new funding increase, he promised not to extend tax audits on firms and people earning less than $400,000 per year. Werfel has served as acting IRS commissioner and as the worldwide public sector practice leader at Boston Consulting Group.
In a speech to IRS and Treasury personnel, Treasury Secretary Janet Yellen said that Werfel’s mandate would include “dramatically enhancing taxpayer service and ensuring that major organizations and the rich pay the taxes they owe.”
To better audit firms, high-income individuals, and complicated partnerships that have not paid their taxes in full, the IRS will be investing in data and analytics, Yellen said. More expert people, such as accountants and lawyers, will be hired to supplement the technology.
A March report from the Treasury Inspector General for Tax Administration states that “ongoing backlogs of tax returns and other account work continued to challenge the IRS during the 2022 Filing Season,” despite the administration’s boasting about adding 5,000 new workers and investing in new technology.
Werfel said the following to staff in a letter dated March 13 “I’m back in public service so that I can help you make the most of the Inflation Reduction Act’s opportunities.