Rettig, a corporate tax attorney with a strong background in tax controversies from his work as a 35-year private practitioner, was confirmed by the U.S. Senate on Sept. 12. He will begin his official duties as the IRS' 49th commissioner on Oct. 1 and will serve the remainder of the five-year term that began Nov. 12, 2017, when former Commissioner John Koskinen completed his service.
During his tenure at the Los Angeles based firm of Hochman, Salkin, Rettig, Toscher & Perez, Rettig represented clients before the IRS, the Tax Division of the U.S. Department of Justice and in federal and state court litigation and appeals. In addition, Rettig spent nearly 20 years chairing the IRS Advisory Council and also served as chair of the Taxation Section of the State Bar of California.
Approved, but with reservations: The Senate vote was 64-33, which earns this week's By the Numbers honors.
The nay votes came primarily from Democrats who are not happy with Rettig's apparent acquiescence of the Treasury Department's new donor privacy rule that eases disclosure requirements on nonprofits that give money to political campaigns.
Sen. Ron Wyden (D-Oregon), the ranking Democrat on the Senate Finance Committee, complained prior to the Senate vote that the current White House "has weaponized the tax code to punish its political adversaries and benefit shadowy far-right groups that seek to buy elections."
"Two months ago, just hours after Maria Butina was outed as an alleged Russian spy who sought to influence our elections, the Trump administration announced a new rule opening the floodgates to more dark money and foreign money in our politics," said Wyden.
Wyden raised the issue with Rettig during the nominee's hearing. The Oregonian did not get the answers he wanted, leading to his no votes at the tax-writing committee and full Senate levels.
His counterpart across the aisle, however, was pleased with Rettig's approval.
"With the biggest tax overhaul in a generation on the books, it's about time that the agency charged with administering our nation's tax laws has a confirmed commissioner," said Sen. Orrin Hatch (R-Utah), chair of the Senate Finance Committee. "From implementing tax reform so that Americans continue to benefit from increased growth, job creation and wages to restoring trust in an agency complicated by scandal and mistrust, Chuck has his work cut out for him. But, he has proven that he is qualified and ready for the challenge."
Tony Reardon, national president of the National Treasury Employees Union (NTEU), also is optimistic. The NTEU, which represents 70,000 Internal Revenue Service employees, "is eager to maintain open communication with agency leadership about making sure the IRS workforce has the resources it needs to carry out the agency's important missions," Reardon said.
Rettig's long IRS to-do list: Rettig's first job, as Hatch noted, will be to ensure that Uncle Sam's tax collectors are prepared to deal with the Tax Cuts and Jobs Act changes — many of them still confusing to taxpayers and tax professionals alike, who are awaiting IRS guidance (or additional clarification) — that took effect for the most part in tax year 2018.
Rettig also inherits the job of regularly asking Congress for enough money to allow the IRS to do its many jobs, which include not only collecting taxes, but enforcing tax laws and helping taxpayers understand and comply with them.
Congress has cut the IRS budget by around 20 percent since 2010. It did provide some more money this last and next year's budget cycles, but those funds are specifically tied to implementing the new tax law, not covering existing program financial gaps.
One of those gaps that needs a patch (or more) is the IRS' outdated information technology system. Part of it crashed in April on the last day of the 2018 tax filing season.
Then there's the matter of taxpayer — and IRS — security. The agency, working with state tax departments, tax software manufacturers and tax professionals has made much progress in stemming cyber security threats.
But the Security Summit, as the tax security working group is known, acknowledges that its efforts are never-ending since tax identity thieves and tax scammers constantly change their schemes.
Politics could change things: Finally, if there's a change in control of either or both chambers of Congress after the midterm elections, Rettig could find himself as the mirror image of his predecessor.
Previous IRS chief Koskinen was always fending off Republican attacks during his term, mostly in connection with the now-closed Tea Party 501(c)(4) nonprofit status scandal that erupted in 2013. Those groups are among the ones that would benefit from the IRS regulation revision that Wyden opposes.
If Democrats take over either or both the House and Senate, look for them to hold Rettig's feet to the fire on various matters of importance to them (starting with Wyden's concerns) as did their GOP colleagues during Koskinen's term.
You also might find these items of interest:
- Tax-writing duo wants to remake the IRS. Again.
- IRS, FTC expand electronic fight against tax ID theft
- IRS voluntary tax preparer program gets federal court OK