The Senate Finance Committee approved Thursday the nomination of Daniel Werfel as the next Internal Revenue Service commissioner by a 17-9 vote.
Werfel appeared before the committee during a confirmation hearing last month and seemed on track to win bipartisan support, with both Democratic and Republican leaders agreeing on the likelihood of him taking over the agency (
He had experience a decade ago as acting commissioner in 2013. Werfel was brought in to clean up after the so-called Tea Party targeting scandal erupted over complaints that the IRS was subjecting applications for tax-exempt status from political groups to extra scrutiny, leading to the departures of the former acting IRS commissioner and the director of exempt organizations at the IRS.
Prior to that, Werfel served as a controller at the White House Office of Management and Budget during the Obama administration and working at OMB starting in 1997 through multiple administrations.
After leaving the federal government, he worked in the private sector as a managing director and partner at Boston Consulting Group. He will be succeeding former IRS commissioner Chuck Rettig, whose place has been filled since November by Acting Commissioner Doug O'Donnell, who will remain the IRS's chief taxpayer experience officer and commissioner of the IRS's Wage and Investment Division.
The job of IRS commissioner is a difficult one, as the agency has come under fire over a backlog of delayed tax returns last year. However the IRS seems to be on track for a more normal tax season this year after pandemic relief added to its workload last year. It will also be benefiting from an extra $80 billion in funding over 10 years from last year's Inflation Reduction Act, although House Republicans have voted to pull much of that money over fears that much of it would be used for increased enforcement and tax audits.
However, Werfel won bipartisan support in his confirmation vote.
"The fact that Mr. Werfel's nomination passed through committee with bipartisan support is a testament to his record as a fair-minded public servant who's able to work with both sides in Congress," said Senate Finance Committee Chairman Ron Wyden, D-Oregon, in a statement. "After a decade of Republican budget cuts there is a clear double standard in tax enforcement. Too much of the burden of audits falls on working Americans, and wealthy tax cheats know the odds are they'll get away with ripping off everybody else scot-free. Democrats gave the IRS new resources to rebalance the system and make it more fair by going after tax cheating by the wealthy and corporations. There's no doubt that Mr. Werfel understands the challenge, and he's also going to ensure the IRS continues making progress improving customer service."
During his confirmation hearing, Werfel was asked about his plans for the $80 billion and whether it would be used for audits of middle-class and low-income taxpayers. He disputed claims that the IRS would hire an army of 87,000 auditors.
"I think it's patently incorrect," he responded. "In fact, I entered the job with a directive from Secretary [Janet] Yellen to not use IRA funds to increase audits on anyone earning less than $400,000 that would be a small business or working family. Instead, my understanding is the focus is to hire people with the understanding and capacity and talent to unpack very complicated, intricate returns, which is a capacity gap that exists today. So I think the notion of of armed agents is incorrect. I certainly would have no intention of making that part of any plan going forward."
