WASHINGTON ā IRS Commissioner Danny Werfel has a message for high-wealth tax cheats who are wrongly deducting private jet travel and otherwise shorting the government on their taxes: Pay your fair share so āothers arenāt shouldering the burden of funding our government."
He also has a thought for ordinary taxpayers putting off the inevitable with less than a month left in tax-filing season: āGet it done.ā (And double-check your work.)
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Werfel, who will hit the one-year mark at the helm of the IRS in April, said in a wide-ranging interview with The Associated Press that the agency will expand its pursuit of high-wealth tax dodgers with new initiatives in the coming months and is using tools like artificial intelligence to ferret out abuses and taking the fight to sophisticated scammers.
That doesnāt mean the IRS has undergone a complete image makeover. Thereās still plenty of criticism to go around, including from Republican lawmakers who accuse the agency of heavy-handed overreach.
āWeāre kind of like the NFL referee ā when we get the call right or wrong, we get booed, and weāre OK with that,ā Werfel said.
But efforts to crack down on high-wealth tax cheats are starting to bite, he says, and that should mean more money coming in to fund the government.
āIt's having an impact,ā Werfel said. Large corporate filers and others are ātaking notice that the IRS is ramping up our scrutiny, and I think that will inevitably result in more compliance" ā and revenue.
Werfel is promising taxpayers better service this year as he works to repair the agency's image as an outdated and maligned tax collector. But it's a tall order for a federal agency that even he has referred to as āiconically unpopularā with the American public.
āWe have some myth-busting to do,ā Werfel said, referring to alarmist and inaccurate Republican claims that the agency plans to hire 87,000 armed agents ready to harass middle-income earners.
āWe are not," he said. āWe are hiring phone assisters armed only with phone headsets. Weāre hiring accountants armed only with calculators.ā
Werfel took over an agency that was understaffed and drowning in unprocessed tax returns after decades of underfunding.
Shortly before he arrived, the IRS received an $80 billion infusion under the Democrats' Inflation Reduction Act passed in 2022. But Republicans have been chipping away at that money.
Last yearās debt ceiling and budget cuts deal between Republicans and the White House resulted in $1.4 billion rescinded from the agency and a separate agreement to take $20 billion from the IRS over the next two years and divert those funds to other programs. And this past January, a debt ceiling deal meant to avoid a government shutdown frontloaded the full $20 billion cut to this year.
Werfel has been in a race against time to show how improvements to the agency can benefit taxpayers. He said agency priorities include customer service improvements like answering the phones faster and making sure the rich āpay their fair share."
The agency also is piloting a program for people to file their taxes directly to the agency without the help ā or cost ā of private commercial software.
Werfel said more than 50,000 people in 12 states have started using the new Direct File system to complete their taxes. The free online tool is available for people with very simple W-2s and who claim a standard deduction for their federal income taxes.
The Direct File rollout has drawn some consternation from commercial software firms like Intuit, as well as Republicans who argue there are free filing programs that already exist.
But so far, Werfel says, āpeople are telling us that they found it to be quick and easy, and everyone certainly loves that itās free. And their No. 1 question is: Are we going to have this again next year?"
Werfel sounds optimistic, but he's not ready to give an answer yet on the program's future.
Overall, Werfel says, the agency has added āmore tools to IRS.gov in the last two years than in the previous 20ā to make tax-filing easier. Wait times for answering phone calls are at two minutes or less.
Werfel sat for an interview in an auditorium at the IRS headquarters in Washington, where he said sustained funding is critical to make up for past shortcomings. He said IRS workers are "passionate about helping taxpayers. And when we donāt have the funding to provide them the tools or the training, theyāre upset because they canāt do enough to help the taxpayers.ā
Major new initiatives in recent months have included an aggressive pursuit of high-wealth earners who don't pay their full tax obligations, such as people who improperly deduct personal flights on corporate jets and those who just don't file at all.
The private jets, in particular, are a place where āmany corporations are sloppy with their bookkeeping,ā he said. Werfel said the agency's crackdown there "sets the tone for the American peopleā that everyone has to pay what's due.
Werfel said the agency also has put new focus on "being accessible, answering the phones, keeping our walking centers open and updating our website so that people can do things more with the IRS without ever leaving their smartphone or their tablet."
Even so, he allows, the agency still isnāt technologically where it needs to be.
There is still an operating pay phone located in the hallway at the IRS building.
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See all of the APās tax season coverage at https://apnews.com/hub/personal-finance.