The Internal Revenue Service may be short-staffed and have seen its budget cut, but Commissioner Charles Rettig believes he can both improve taxpayer and tax practitioner service, and up the agency’s enforcement game.
“I’m an enforcement guy, I’m a taxpayer service guy -- I hope to touch every aspect of the tax service,” he told an audience of over a thousand accountants in his keynote at the American Institute of CPAs’ 2019 Engage conference.
“Last year we collected $3.5 trillion -- 95 percent of the gross revenue of the U.S. government,” he explained. “We cannot have a functioning government without a functioning IRS.”
That is beginning to be recognized in Washington, he noted: “There is a bipartisan feeling that we need a fully functioning Internal Revenue Service,” he said, noting that Congress is seeking $12 billion in appropriations for its next budget. “Though we’d like to see it raised!”
Regardless of the final budget figure, he thinks the service is better-positioned than some might think. “This is not the old IRS -- yes, we have fewer employees and fewer resources, but this is 2019. Data and analytics -- I could leave it there, but the things we have internally are fantastic,” he said.
“We set records for the number of returns processed in an hour and per second this season -- 560 per second, and 1.6 million in an hour -- and we processed 15 million returns on April 15 alone,” he said. “The reason we performed is because our employees are spectacular and dedicated and they want to do well for their country.”
Once a tax pro ...
“I thrive on tax,” said Rettig, who was a tax attorney for three decades before becoming commissioner. “I read the cases every day and I read the guidance -- I’ll never lose my passion for tax.”
As a practitioner himself -- the first to helm the IRS in 20 years, since Margaret Milner Richardson in 1997-1998 -- he called on the audience at Engage to work more closely with the service.
“The IRS has the ability to help this country, and this country has the ability to help the world, and as tax pros, you have the ability to help the IRS,” he said.
To start, practitioners can be more understanding of the burdens on IRS staffers. Rettig talked about how, during the 35-day government shutdown earlier this year, thousands of IRS employees were required to work without pay.
“They were told they’d get paid after the shutdown -- go to your landlord, or your mortgage broker, and try telling them you’re going to pay them as soon as the shutdown ends. Just try that,” he suggested. “We got complaints from practitioners saying, ‘I can’t get transcripts’ -- well, woe is me. Try to focus on the people inside the IRS -- we dealt with very difficult personal situations every single day for 35 days.”
And while he fully acknowledged that telephone wait times need to improve, he also offered some extra information to bear in mind.
“I understand the tax practitioner community needs a way to communicate with the IRS,” he said. “I’ll give you an insight to think about while you’re on hold: In the last six years, 9,000 IRS operators handled 1.6 million phone calls on behalf of FEMA; we help them because they don’t have call centers to help people who are hit by floods or tornadoes or disasters.”
He also called on practitioners to help taxpayers and the IRS resolve issues quickly and transparently.
“It’s the responsibility of everyone here to get there first -- if your clients have issues, clean it up fast,” he said. “I believe tax practitioners need to do the right thing. If you discover problems in preparing for an IRS exam, let us know.”
He also struck a strong note for enforcement.
“Taxpayers who are trying to do it right will have my support,” he promised. “Those who wake up with an idea of a creative way not to pay tax -- I’m paying attention to that. We will have a much greater presence on enforcement than before. We will be in every neighborhood that we can be, we’ll be touching people -- but a fair touch.”
Service and inclusion
From his own personal experience, Rettig has developed two priorities that he shared with the audience.
“When he heard I’d been named commissioner, my son, who’s a captain in the Army, said, ‘I’m so proud you’re following me into government service!’” Rettig recalled. “We at the IRS aggressively hire veterans and will continue to do so during my tenure.”
His IRS will also be committed to expanding its capabilities in different languages.
“My wife is a refugee from Vietnam, so you’ll see a lot of stuff come out from us about ESL and non-English language materials -- as soon as I master English myself!”
The IRS currently works in six languages -- primarily in English and Spanish, but also in Vietnamese, Korean, Russian and Chinese. On learning this, Rettig asked, “‘Which Chinese -- Mandarin or Cantonese? You understand that they’re different, right?’”
“It’s a respect thing,” he added. “We gain by being different and being understanding and accepting of the different people around us.”
Beyond those goals, Rettig hopes to leave the IRS much improved when his term is up in 2022.
“I believe we have a real opportunity to make the tax system to better,” he said, before adding: “And we’re hiring! We’re hiring across the board -- in LB&I, Criminal Investigation, and many other areas. ... How many jobs do you have where you can make a real difference for people you’ll never meet? I can go home at the end of the day and say, ‘I did this today -- do you know how many people it will help?’”
