IRS Commissioner Danny Werfel announced his resignation effective Monday, January 20, 2025, coinciding with Inauguration Day. The departure comes as President-elect Donald Trump plans to nominate former Missouri Representative Billy Long as the next commissioner, despite Werfel's term not being set to expire until November 2027.
Deputy Commissioner Douglas O'Donnell will serve as acting commissioner until Long's confirmation by the Republican-majority Senate. O'Donnell, who previously served as acting commissioner from November 2022 to March 2023, brings continuity to the role during this critical transition period, with the 2024 tax filing season set to begin on January 27.
During his tenure since March 2023, Werfel has overseen significant modernization efforts, including the implementation of the Tax Professional Online Account system and the launch of the Direct File program. The agency has made substantial progress in modernizing the Individual Master File system, which now runs parallel to legacy systems, marking a significant technological milestone for tax administration.
Under Werfel's leadership, the IRS has strengthened its enforcement initiatives, recovering over $1.4 billion from high-income individuals with overdue tax debts and increasing scrutiny of large partnerships and corporations. The agency also addressed challenges with the Employee Retention Credit program, implementing and subsequently lifting a temporary moratorium on claims processing.
Looking ahead, practitioners should be aware of potential changes under the new administration. The IRS faces possible budget cuts exceeding $20 billion under current continuing resolution language, and the future of the Direct File program remains uncertain amid Republican opposition. The incoming commissioner's approach to ERC claims may warrant particular attention, given Long's previous advocacy for the program.
Werfel emphasized that preparations for the upcoming filing season remain his primary focus, with discussions already underway between the IRS, Congress, and the presidential transition team to ensure operational continuity. The agency maintains its commitment to non-partisan operation during the transition, with Werfel noting that recent technological improvements should facilitate quicker implementation of any 2025 tax code changes.
Senate Finance Committee ranking member Ron Wyden praised Werfel's tenure, highlighting improvements in taxpayer service and efficiency that have received bipartisan support. As the transition unfolds, practitioners can expect established digital tools and modernization efforts to remain operational, though future modifications may occur under new leadership.
Christine Gervais is a licensed CPA, using her skills to help businesses grow and achieve their fullest potential. Christine has a Master’s degree in accounting from Southern New Hampshire University in addition to holding her CPA license for over a decade. Notably, Christine is a nationally recognized speaker providing education to other CPAs on how to best serve clients as well as instruction on a wide variety of topics for business owners on how to maximize success. Christine prides herself on the value she can bring to clients with her extensive tax knowledge and provides strategic, forward-thinking financial strategies to help clients grow. When not behind her desk, you can find Christine spending quality time with her daughter and stepson or tending to the family’s excessively loved farm animals.
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