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IRS Commissioner Nominee Daniel Werfel Eyes Using $80 Billion Budget For Agency Modernization

Daniel Werfel
IRS commissioner nominee Daniel Werfel testifies before the Senate Finance Committee during his nomination hearing on February 15. (Photo by Kevin Dietsch/Getty Images)

Lawmakers grilled  Internal Revenue Service nominee Daniel Werfel last week on his plans for managing the $80 billion in additional cash that will be given to the organization over the upcoming years.

CNN reported that Werfel, a former acting IRS commissioner, pledged to respect Janet Yellen’s earlier order that the IRS not use the additional cash to enhance audit rates for households earning less than $400,000 per year in comparison to previous levels. 

Daniel Werfel

WASHINGTON, DC – FEBRUARY 15: Internal Revenue Service Commissioner nominee Daniel Werfel testifies before the Senate Finance Committee during his nomination hearing. (Photo by Kevin Dietsch/Getty Images)

Increasing the IRS’s capacity to make sure that the nation’s top incomes abide by relevant tax laws would be the audit and compliance priorities, Daniel Werfel told the legislators.

“If poor people are more likely to be audited than the wealthy, that is something I think potentially degrades public trust and needs to be addressed within the tax system,” he added.

Wealthy Americans have progressively faced fewer audits following years of budget cutbacks. According to a new study by Syracuse University’s Transactional Records Access Clearinghouse, an IRS audit was 1.1% likely to happen to millionaires in fiscal 2022. 

Black People are around three to five times more likely to experience an IRS audit than other taxpayers, according to a new research, and the audit rate has decreased more slowly for lower earnings claiming the earned income tax credit.

ALSO READ: California Tax Deadline: See What IRS Announced About This Extension

 IRS Nominee Daniel Werfel’s Appointment

CNBC said Daniel Werfel’s appointment comes at a crucial time for the struggling agency, which will receive $80 billion in financing over the following ten years as part of the Inflation Reduction Act in August. 

The Associated Press mentioned that President Joe Biden nominated Werfel to lead the IRS as it will earn around $80 billion over the following ten years due to the Inflation Reduction Act, which Congress enacted in August. 

 Daniel Werfel noted the possible effects of the money and stated that “Americans could expect a more contemporary and effective IRS.” 

Werfel, 51, pledged to be “unyielding in following my true north to build public trust” in the organization even as he works to update the organization’s technology, reduce the amount of paperwork it generates, and examine high-income earners.

Following months of consideration, House Republicans voted in January to revoke the money, which was mainly viewed as a political messaging measure lacking the backing of the White House or the votes needed to pass in the Senate. 

IRS is anticipated to present the $80 billion funding plan on Friday as requested by Treasury Secretary Janet Yellen.

RELATED ARTICLE: Free Face-To-Face Tax Assistance And Taxpayer Assistance Centers Open On Certain Saturday. – IRS

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