Transcripts For CSPAN2 Commissioner 20240704 : vimarsana.com

CSPAN2 Commissioner July 4, 2024

Hello and welcome to the American University. My name is caroline and i am a tax professor and managing direct center here in the school of business. I wanted to take a quick moment to introduce you to the tax li that dont know as we are a nonpartisan Research Center housed in the school of business and we put out research on issues ranging from Small Business literacy and education to Tax Compliance challenges the independto capital challenges of Business Owners and importantly for today, Tax Administration c challenges. More broadly, we are experts on aia analytics and Digital Transformations and we build this expertise into the research and curriculum for example the Research Center earlier this year together with ibm center of the business of Government Produced research on how tax agencies can effectively adopt and deploy aai. The research reflects opportunities and challenges for those using ai and we were able to draw on comments from the commissioner, other irs folks into tax agency administrations from around the world to talk about how aia has the■ improven and outreach, how ai can facilitate the compliance enforcement activities and how it needs to be rolledigation strategies and government structures. What we are here to talk about is the irs Digital Transformation plan which will be introduced by the irs commissioner who is marking his one Year Anniversary with the irs this presenting a presentation for 20 minutes and then be in conversation with our very own david. They Work Together about the 2020 president ial transition so it will be great to hear them recap and shed some light so thank you so much for joining us. [applause] one Year Anniversary as commissioner it is an honor to university. The irs is an agency that affects all americans and a university is a fitting place to talk about the future irs because you are at the start of a journey where you will be filing your taxes with of the irs for many, many years to come. In the fall of 2022, i take a phone call from the bite administration asking if i would be able to serve as irs commissioner. Once i could get my jaw off the floor it was a great honor. My firste and treasury departmet leadership what are you hoping i or any irs commissioner would achieve in this role at this time . The answer they gave me encapsulates the once in a generation opportunity. They told me the next commissioner will lead the irs through the most importantagenc. So again it might draw it dropped to the floor and i will be honest with you part of me suspected of hyperbole. Something of a sales pitch to get my hat in the ring for the job. This was no exaggeration. What you have come to do it digitally on your phone and tablet without paper wherever you are in the world the modernization of the irs is a generational imperative. Everincreasing Digital World is just part of the imperative. Our race to catch up with the modern economy three critical results. To ensurey■p makes Administration Work better. Those who seek to inappropriately exploit the tax system. And third and unlocks our ability to restore trust and fairness in the irs and the taxes. So lets dive in and explore where the work being done to transform the irs is so right on in beneficial our family and our community. I will tell you a today and whee the momentum can take us. I remember the moment i realized that was not the type or in exaggeration. Our morning staff meeting last fall. The night before id been at the service for america award at the kennedy center, the oscars for government i was excited i challenge the irs team to win on his big awards nt year. E for anf an award winner i immediately shared with them my Favorite Award from the night before. Eams who sent a rocket into space both light and 7 million bales away going 4000. These nasa scientists hit the asteroid dead center not only did they hit a bullseye, it changed its trajectory. For the first time nasa scientists and engineers proved if an asteroid were ever headed for earth they could deflect it and save humanity. My team looked at me sheepishly and said commissioner that is going to be tough to beat. Teamd in and said but where did nasa get the money for the rocket . It is collected by the irs. That is the moment i fully appreciated how important the irs is and how monumental this task and opportunity is. It is not just ensuring we have the funds of nasa scientists to save the planet from an asterois the funds to keep our food safe our skies safe our roads safe. If we are essential to finding so many of the things that make life in america possible i am one burning question. Why . Why did Homer Simpson not like us . Theyre supposed to be a video here. Lets see if it pops on. I dont think were going have the video. In that video probably pop on one telling the story. Homer drives i■g tne telling the story. Homer drives oh boo your self. So what does Homer Simpson not like us . Maybe he thanks hes paying too thanks his taxes are far too complicated. Its osi control we do not set the tax rate to write the tax code. But if homer and other taxpaying americans answering the phone, we are taking too long to send a refund or otherwise increase stress and frustration as they navigate their tax responsibility rather than decreasing it that we can and should turn things around. We have a large mountain to climb. These are snapshots of the irs just a few years ago. Hallways and cafeterias. Shuttered Tax Assistance Center so people cannot get help. So i suppose i could understand we may be booed by Homer Simpson or other cartoon americans are being frustred■n with the irs. How do we get to this point . When the rest of the world had moved beyond paper deteriorating customer service, anemic audit rates stagnant technology, it was the result of twoover the l. The first trend the irs had been underfunded for far too long. From 2010 until 2020 when the irs budget was slashed by more during this decade of budget cuts the population grew and ana returns increase by more than 15 million along with countless changes to the tax laws increasingly complicated financial environments, globalization, additional currencies, exponen and other fs that increase the size and complexity of the american taxs. As our budget declined butter plate of responsibilities grew irs employees work through it. Long hours and sweat equity would often get the job done because Innovative Technologies were not available. Enter the pandemic. The iris workforce including running the tax system and successfully getting emergency payments to hundreds of millions of americans on Small Businesses across the country. But eventuallyhe out. Coming out of the pandemic we are so varied understaffed and hobbled by stagnant we literally could no longer answer the phones or keep our walkin centers open. Te reduction act in 2022. Finally we had new funding to build the irs back to par performance but builds it for the future. Even though this new law provides a 10 year runway for the irs to rebuild, it has been clear since day one that we needed to show results immediately. Funds from the new law will allow us to dig out of a deep hole. Get back to Better Service standards and laid the lay the n for the transformation to come. Catalyzing a new era for the irs. Hallways and cafeterias has ended. Phone center is back all the walkin centers are open fully staffed and expanding around the country and we have new tools on irs. Gov and if suit record traffic to the site. We have much more Digital Tools of the last twoea launch the la. Sometimes it is the Little Things this we get a call back option texture is required to stay on hold to lisn to elevator music. When you are funded you can make these types of improvements. The past. Urra now we have an opportunity to move beyond just base a performance and build a 21st century tax agency to serve the American People in a manner they expect and the level they deserve. Our vision for the irs is truly effective in easing the stress caused by our complex tax laws. Simpler forms, more intuitive processes when a staff trained drug empathy, understanding who have the tools obligations easiy and fairly. But let me make it even more real for you. Myar their 80s have never use an atm. They go to bank come talk to a cash. My children on the other hand are in their 20s have never set foot in a bank appeared to open an account cash. Think about how you interact with your bank. When you buy something with a debit card, that transaction account before you even leave the store. When your bank is concerned about fraud it will text you and let you sort it out equally from your smart phone. When the irs may be fraud with your account we send you a letter. We are working to change that. ■ trap form to be ready for the new digital economy. With historic funding through the new law building irs were all taxpayers can be all of their responsibilities including all interaction with the irs. No questions, payments and a completely digital manner that they choose. Most taxpayers want to interact with us the 21st century. Transformation is also the keystone that helps unlock the True Potential of the irs. Heres how. When financial and travel companies moved everything online which accelerated during covid the number o people calling drop precipitously. As did the number of people strapped tocklocations. Our vision is not only were you can deliver for taxpayers online it is one or we redeploy capacity and absolute still need our employees who will now have the time and tools to focus on helping people who need it most increasing scrutiny on bad actors and purposeful tax evaders. In terms of unlng people that nr help the most, less time on phones means more time means our employees can spend more time engaging in commu■ynities■ supporting walk insights and mama and volunteer tax clinics that assist low income filers helping taxpayers who cannot affordt to get it right the first time. processing paper returns employees can spend more time helping every taxpayer regardless of income claim credit for like the earned income tax credit which is an economic lifeline for so man never claim the credit. Do more to help them. Digital irs does not mean we are walking away from service. It means we can do more to help the people who needed the most. Digital transformation to unlock new capacity is already begun. For example we made significant upgrades to wheres my refund tool. Also this Filing Season we launched direct file a system of taxpayers file tax returns online directly with the irs for free. Direct file is almost tailormade for students its a simple tax situation. Check it out go to direct file. Irs. Gov to see if you example of whats coming in the near future. A clear way to communicate with the irs and protects taxpayers. We will have a screen on your online account like this letting you know if the irs is trying to contact you. Why is this important . We have too many bad actors calling and texting, pretending to be the irs tricking americas are pulling out their credit card and paying them a fake tax debt. In the future if you get such a call or text you will just teach about your online account. If it shows a green banner like this actual irs is not trying to reach you. Hang up, ignore the text and if you are willing to report this to us online so we can investigate it. You can seat right there at the Digital Transformation frees up capacity to better crackdown. It also unlocks capacity for the irs for scrutiny evade the tax responsibility. Most significantly cuts down on basic mistakes and errors freeing up our employees to focus on the more complex■j issues. Noncompliance overwhelmingly occur among our highest wealth and largest taxpayers. Many wealthy and large taxpayers are doing the right thing to many are using complexities. Too inappropriately shield their less resources dedicated to sorting paper returns means more resources such a this complexity and find hidden income. In fact we are already using use of the largest in the world for hiding income behind complexity that se ai helps with the precision partnerships playing by the rules and doing the right thing. Using the new ai models audits on 76 hyatt risk complex partnerships including hedge funds and publicly traded partnerships. Capacity to broaden our reach scrutinize a lot more high risk complex filers that we previously could. At to focus our enforcement efforts on the high income groups that for too long have fallen under the radar. With new funding weve already served notices to 125,000 high income taxpayers who fail to file a federal income tax return since 2017. Including 25000 people with incomes over 1 million. These nonviolence represent more than 100 billion in financial activity. We are cracking down on 1600 millionaires and billionaires we will not allow higher incomevidh their basic civic duty of filing a tax return and paying with ao. A more digital irs unlocks our ability to audit inappropriate writeoffs for personal use of corporate assets■ such as corporate jets. In my first year here the irs team has already collected nearly 500 million millionaires and billionaires to ensure fairness in our tax system. And we are just getting started. So, this is how our digital platform for taxpayers will unlock our employees capacity to help people in need and to needed most. Utiny where i perhaps most critical is new funding inner transformation to unlock our ability to ensure they are desperate for everyone who plays by the rules and helps restore trust in the system. No issue is more important tha fairness. Just over a year ago, in fact in the days leading up to my Senate Confirmation hearing, researchers at several universities and the u. S. Treasury published a study that black taxpayers three times more likely to be audited than other taxpayers. Our processes were impacts on black taxpayers. Not only committed to fixing this top priority confirmed but i became more motivated to become the irsioner. I wanted to fix this. Any indication of racial bias in our work is unacceptable. Met ws team setting the issue. Too quickly evaluate the extent to which art■ahe processes in the data we rely contributed to the spit disparity paid since ive been comm yissioner ive been meeting with communities that were impacted, hearing their concerns, sharing our regrets and outlining the actions we are taking on substantially reducing the number of audits or they were identified. Our algorithms specifically intended to address the disparities. We are now ready to invest new urces to help identify any disparities age, gender and geography. We are using that research to continuously refine our approaches across compliance efforts. Were trying to rebuild trust for overhauling appliance and hold ourselves accountable for the taxpayers we for one or 50 years dating back to president lincoln but more recently the irs has evolved. Tax laws are increasingly playing a larger role in addressing the most pressing challenges of our t irs employees are hard at work on programs to cut child poverty. Programs to expand Healthcare Access until age 26 the Affordable Care act. As to the irs and taxes. To address the threat of Climate Change because the hundreds of billions of dollars tax credits. With defendant we can support policies to improve the lives of all americans. To meet this critical moment in tax collection and beyond. But to succeed and truly build building irs for the 21st we need to count lawyers and finance experts. We also need data scientists, engineers, experts and ai in ou are studying your expertise and most importantly your passion for change in service. The summer of 1963 john f. Kennedy came here to Americans University commencement where he called for the First Nuclear Test Ban Treaty with the soviet union. It was the start of a historic effort that led to greater stability and peace in the world. President kennedy enjoyed president. I pass a photo of his speech in our building every day. President kennedy told graes in 1963 no problem of human destiny is beyond human beings. Mans reason and spirit the seemingly unsolvable. We believe we can do it again. Thankfully Tax Administration is a far cry from nuclear diplomacy. The decisions the action of t ty american directly and indirectly. Those are in this effort to soe long been unsolvable. To undertake the most transformation of a governm his. Catalyzed by historic funding, guided we can transform the irs for the 21st century. Can meet taxpayers where they are paid support them to meet their obligations and make Tax Administration work2eetter. To try to exploit the tax system. Restore trust and increase etter serve the country and you, our taxpayers in the years and decades to come. [applause] clicks my irs stress ball they are handing out over their i need one of them. Eam for putting this event together. Theyre working over the weekend let me say thats extraordinary speech. I have been for 33 years. Ive never seen a Government Official give a speech like that. Its usually looking at a net wood podium through notes with eight part plan and subparts. It was a metaphor for what youre trying to do is open up the irs, bej transformational i got the compliment you on that. Thank you. Quickly talk about your person ive known you for a while peeking at our career at the boston con running a big practice in making a lot of money. One of the hardest jobs in government. Why did you do that . It is a passion and a calling for Public Service. At the of the acting irs commsioner very c

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