Key Takeaways
- IRS Commissioner pick Billy Long
- Republican's 2025 tax strategy on Capitol Hill
- TCJA expansion
- IRS foreign information reporting penalties
- IRS releases required retirement plan amendment list
- National mitten tree day!
Trump's IRS Commissioner pick
He Promised Huge Tax Refunds. Now Trump Wants Him to Lead the I.R.S. - Andrew Duehren, New York Times:
When Billy Long, now President-elect Donald J. Trump’s pick to lead the Internal Revenue Service, left Congress in 2023, he quickly set out to make money. Building off the relationships he developed as a Republican from Missouri and auctioneer, Mr. Long began encouraging people to file for a lucrative, pandemic-era tax credit.
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If the Senate confirms Mr. Long to lead the tax collection agency, he will be in a position to ease access to the tax credit. During his time generating claims for the employee retention credit, Mr. Long said, he repeatedly tried to persuade potential clients to disregard the advice of their accountants, who doubted whether they could qualify for the credit.
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If the Senate confirms Mr. Long to lead the tax collection agency, he will be in a position to ease access to the tax credit. During his time generating claims for the employee retention credit, Mr. Long said, he repeatedly tried to persuade potential clients to disregard the advice of their accountants, who doubted whether they could qualify for the credit.
Trump names his own pick for IRS commissioner, breaking from tradition - Julie Zauzmer Weil and Jacob Bogage, The Washington Post:
With his announcement late Wednesday that he’ll appoint former Republican congressman Billy Long of Missouri to lead the Internal Revenue Service, President-elect Donald Trump is bucking the tradition of allowing IRS commissioners to serve out their full five-year appointments.
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Long “is an extremely hard worker, and respected by all, especially by those who know him in Congress. Taxpayers and the wonderful employees of the IRS will love having Billy at the helm,” Trump posted on Truth Social, without mentioning that the role of IRS commissioner is currently filled.
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Long “is an extremely hard worker, and respected by all, especially by those who know him in Congress. Taxpayers and the wonderful employees of the IRS will love having Billy at the helm,” Trump posted on Truth Social, without mentioning that the role of IRS commissioner is currently filled.
Taxwriters to Probe Trump IRS Pick’s Qualifications - Cady Stanton, Benjamin Valdez, Tax Notes ($):
Long, who was a real estate investor and an auctioneer before his 12-year stint in Congress, cosponsored a bill, the Fair Tax Act, in 2017, 2015, 2013, and 2011 that would have abolished the IRS and levied a national sales tax. Under the bill, funding for the agency would have been halted and state administrators would have been responsible for collecting the tax and remitting it to Treasury.
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“What’s most concerning is that Mr. Long left office and jumped into the scam-plagued industry involving the Employee Retention Tax Credit,” Wyden said. “These ERTC mills that have popped up over the last few years are essentially fraud on an industrial scale, conning small businesses and ripping off American taxpayers to the tune of billions of dollars.”
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“What’s most concerning is that Mr. Long left office and jumped into the scam-plagued industry involving the Employee Retention Tax Credit,” Wyden said. “These ERTC mills that have popped up over the last few years are essentially fraud on an industrial scale, conning small businesses and ripping off American taxpayers to the tune of billions of dollars.”
TCJA
House and Senate Republicans Already at Odds Over 2025 Strategy - Richard Rubin, The Wall Street Journal:
But senior House Republicans worry about pushing two large bills through their slim and fractious majorities, and they warn that the tax bill could falter if it is delayed or isn’t linked to other issues. Under this approach, they could still attempt a second bill even after a tax package advances.
The internal disagreements over how to proceed on Trump’s agenda offer an early look at the policy tensions within the party and how they could be exacerbated by the narrow nature of the Republican majorities, particularly in the House. So far, members have pledged to work together, and they will be unified by Trump’s popularity among Republicans and the scary prospect of tax cuts lapsing on Dec. 31, 2025.
The internal disagreements over how to proceed on Trump’s agenda offer an early look at the policy tensions within the party and how they could be exacerbated by the narrow nature of the Republican majorities, particularly in the House. So far, members have pledged to work together, and they will be unified by Trump’s popularity among Republicans and the scary prospect of tax cuts lapsing on Dec. 31, 2025.
All About That Base(line) - Daniel Bunn and Garrett Watson, The Tax Foundation:
If Congress does not act, taxes will rise for millions of Americans on January 1, 2026, as the individual provisions of the Tax Cuts and Jobs Act (TCJA) expire. Lawmakers are currently discussing ways to address this coming cliff, but one seemingly insignificant issue could shape the debate in important ways: how one measures the budgetary impact of extending the tax cuts.
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President-elect Trump’s nominee for Treasury Secretary, Scott Bessent, has argued that annual deficits below 3 percent of gross domestic product (GDP) by 2028 should be a priority. Bessent’s target is a laudable approach to fiscal discipline, but, in a current policy baseline context, Congress would need to achieve nearly $1.5 trillion in annual deficit reduction to meet it. This would likely require serious cuts to mandatory spending programs like Social Security, Medicare, and Medicaid, something that Congress has been unwilling to do for decades.
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President-elect Trump’s nominee for Treasury Secretary, Scott Bessent, has argued that annual deficits below 3 percent of gross domestic product (GDP) by 2028 should be a priority. Bessent’s target is a laudable approach to fiscal discipline, but, in a current policy baseline context, Congress would need to achieve nearly $1.5 trillion in annual deficit reduction to meet it. This would likely require serious cuts to mandatory spending programs like Social Security, Medicare, and Medicaid, something that Congress has been unwilling to do for decades.
Blogs and Bits
This year’s report highlights several firsts for the agency – the first sentencings tied to syndicated conservation easement schemes, the first indictment and guilty plea of a U.S. taxpayer solely for not paying taxes on gains from cryptocurrency sales, the first time Treasury agencies have led a task force and public outreach series to combat fentanyl trafficking, and a historic financial settlement by the world’s largest cryptocurrency exchange for violating anti-money laundering and sanctions laws.
Tax Court Reiterates Information Reporting Penalty Not Assessable - Andrew Velarde, Tax Notes ($):
The Tax Court has again delivered the IRS a blow in finding that foreign information reporting penalties are not assessable, following in the footsteps of its previous rulings despite a separate contrary circuit court holding.
Judge Mark V. Holmes issued an order and decision on December 5 granting summary judgment in favor of the taxpayer in Safdieh v. Commissioner. In so doing, the court ruled that the IRS could not proceed with collection of section 6038 penalties against Joseph Safdieh, a self-represented litigant, for the 2005 to 2009 tax years.
Judge Mark V. Holmes issued an order and decision on December 5 granting summary judgment in favor of the taxpayer in Safdieh v. Commissioner. In so doing, the court ruled that the IRS could not proceed with collection of section 6038 penalties against Joseph Safdieh, a self-represented litigant, for the 2005 to 2009 tax years.
IRS Errors Allow Millions In Improper Refunds, TIGTA Says - Anna Scott Farrell, Law360 Tax Authority ($):
Tax overpayments aren't being applied to outstanding debt in taxpayer accounts because of procedural and programming errors at the Internal Revenue Service that allow millions of dollars to be improperly refunded to taxpayers, the Treasury Inspector General for Tax Administration said Thursday.
An investigation by the IRS' federal watchdog revealed that more than $8 million in overpayments across roughly 2,100 taxpayer accounts was "not offset because employees manually processed a refund or credit elect but did not correctly identify those taxpayers had outstanding tax debt."
An investigation by the IRS' federal watchdog revealed that more than $8 million in overpayments across roughly 2,100 taxpayer accounts was "not offset because employees manually processed a refund or credit elect but did not correctly identify those taxpayers had outstanding tax debt."
IRS Issues Latest Required Retirement Plan Amendments List - Jack McLoone, Law360 Tax Authority ($). "The Internal Revenue Service released Thursday the 2024 edition of an annual list of required amendments for qualifying individually designed retirement plans. With Notice 2024-82, the IRS released the three-part list for eligible individually designed plans under Internal Revenue Code Sections 401(a) and 403(b)."
Tax Trouble
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