(CTN News) – Tax season was the most chaotic for the IRS.
The agency has three acting directors this week. Some tens of thousands will retire or be laid off. President Trump is considering that NGOs might lose their tax-exempt status, a break from the agency’s typical apolitical posture that may weaken trust in government and weaponize enforcement.
Three months into Trump’s second term, the Republican administration’s latest platform for smaller and managing federal bureaucracy is his under-the-radar tax collector. Tax policy experts warn that rapid changes may hinder taxpayer services and collections.
The IRS’s quick leadership turnover and other changes will harm employee morale and delay taxpayer services, argues Urban-Brookings Tax Policy Center senior scholar Janet Holtzblatt.
“Leadership sets the tone, particularly in this environment,” I say. She claims policy conflicts and layoffs wasted the agency decades of neutral career civil servant institutional experience.
Changed leadership disturbs agencies.
The IRS processed and refunded Americans who filed their taxes before April 15, causing chaos. Last filing season, the received 117 million returns and repaid $228.7 billion.
New IRS acting commissioner Michael Faulkender said, “We’re committed to making the Internal Revenue Service more efficient.” For 35 years, the IRS has been five years from modernization. The Treasury-led overhaul will take two years and cost less.”
Three months into Trump’s second term, the Republican administration’s latest platform for smallening and managing federal bureaucracy is his under-the-radar tax collector. Tax policy experts warn that rapid change may hinder taxpayer services and collections.
The IRS’s quick leadership turnover and other changes will harm employee morale and delay taxpayer services, argues Urban-Brookings Tax Policy Center senior scholar Janet Holtzblatt. “Leadership sets the tone, particularly in this environment,” I say.
She claims policy conflicts and layoffs wasted the agency decades of neutral career civil servant institutional experience.
Changed leadership disturbs agencies.
The IRS processed and refunded Americans who filed their taxes before April 15, causing chaos. Last filing season, the IRS received 117 million returns and repaid $228.7 billion.
New IRS acting commissioner Michael Faulkender said, “We’re committed to making the Internal Revenue Service more efficient.” For 35 years, the IRS has been five years from modernization. The Treasury-led overhaul will take two years and cost less.”
Due to Department of Government Efficiency budget cuts and rotating temporary heads while waiting for a permanent head, the IRS and other government agencies are losing people.
Douglas O’Donnell, the Trump administration’s first acting commissioner, resigned in February over DOGE’s taxpayer data access. Melanie Krause, the second acting commissioner, resigned last month over an IRS-DHS agreement to share immigrant tax data with ICE.
Last Friday, Faulkender was appointed interim commissioner, replacing whistleblower Gary Shapley, who testified about Hunter Biden’s taxes. The New York Times said that Treasury Secretary Scott Bessent informed Trump that Musk appointed Shapley without his consent.
Trump’s contentious IRS commissioner nominee, former Missouri Rep. Billy Long, awaits approval. Democratic senators want Long punished for tax credit loopholes. Long-affiliated enterprises stole millions from tax credit investors, say lawmakers. LONG REFUSED AP calls for comment.
Punishing enemies and rewarding comrades.
The agency worries Trump will use the IRS to punish adversaries and reward loyalists. Major Democratic Party organizations Indivisible and ActBlue are preparing for federal criminal investigations.
Trump said last week at the White House that the administration is reviewing Harvard University’s tax-exempt status, which has resisted government attempts to restrict campus activism and environmental groups. Washington Citizens for Responsibility and Ethics was discussed.
“It’s supposed to be a charitable organization,” Trump stated of CREW. Their sole charity targeted Trump. So we’re investigating. Numerous options are being investigated.” The president cannot unilaterally withdraw an organization’s tax-exempt status, says University of Chicago Law School administrative law specialist Jonathan S. Masur.
No amateurs can. “The Supreme Court has established that step is not allowed,” he said, adding that the legal system will “very quickly block” any presidential move.
The Trump administration protects supporters.
Treasury official David Eisner emailed a top official about MyPillow creator Mike Lindell, a Trump election theft hoaxer, in March.
Eisner emailed the Associated Press that ‘My Pillow Person’ and a high-profile President’s friend received his second audit letter in two years. The president “is concerned that he may have been inappropriately targeted,” Eisner wrote.
Integration of IRS and immigration enforcement
In recent weeks, the IRS’s collaboration with DHS to implement Bessent and Noem’s data-sharing agreement early this month raised concerns. ICE can disclose the IRS’ illegal immigrants’ addresses and names for tax data cross-checking.
SOURCE: USN
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