A new IRS Commissioner and the promise of more effective tax audits

The Senate officially confirmed that the former Congress of Missouri Billy Long will serve as Trump’s second term in the second term of Trump. While some officials have been appointed through their confirmation hearing with limited control, Long did not have the same fate as many senators expressed concerns about his past. It was finally prevalent under the tax authority’s reform platform to be more like an entity in the private sector. This article discusses why he has been so much controlled by what his vision may look like when he is introduced and what has recently published academic research on the current and future state of the tax audit process.

Billy Long’s appointment

Long was a Congress session in Missouri from 2011 to 2022. Before joining the House of Representatives, he was auctioning and radio station. He left the office to run for the Senate, where he eventually lost in the Democratic Championship. Following this stint, he served as a tax consultant for Lifetime Advisors and Commerce Terrace Consulting, followed by work as a Realtor with Murney Associates.

Much of this fluctuation in Long’s background led his candidacy to be somewhat unique and effort. This audit is head of Long’s tax qualifications that focuses on being a certified tax and business consultant who, as mentioned by PropublicaIt is a dubious title that is nowhere close to the same as a professional accountant such as CPA, CIA or CMA. In fact, Long’s accounting and tax experience is minimal, which many have questioned as he struggled to assume the role of the head of the tax authority. Beyond his qualifications, the AP It highlights suspicious activities related to promoting unusually aggressive tax credit, such as employee conservation tax credit and tax credit races.

Despite some of these concerns, after this seventh message process, the Senate has long confirmed a 53-44 vote.

Modernization of IRS

As analyzed in a Tower Article, one of the positives of his appointment is Long’s vision of modernizing and rationalizing the tax authority. Longistically it shows the reception of evidence from the private sector and the elimination of programs that it considers to be wasted, such as the immediate archive.

While Long was unclear for what he meant with this vision of modernization, Uniform He says people in the IRS believe that Long’s vision of modernizing the IRS will include a clearer hug and use of AI and automation in the control process. This prediction comes as numerous IRS positions are eliminated as stated by Politicalleading to questions about the future of the organization.

Research on the tax audit process based on information from tax executives

To a study coming to the Contemporary accounting Entitled “Tax Checks and Political Taxes: Information from Tax Executives”, the authors provide evidence of ineffectiveness in the way IRS audits are carried out as it relates to companies. This study is compiled by Jeri Seidman (University of Virginia, McINTire School), Roshan Sinha and Bridget Stomberg (and the University of Indiana, Kelley School of Business).

This study finds ineffectiveness in the current tax audit process. Sinha notes that the main routes from the study are as follows: “First, checks on financial statements are so regular and so thorough that tax executives consider tax audits as unnecessary. Unfair because they are less likely to accept the outcome.”

A key issue in all findings is the idea that the tax authority sees its role in the process as a police officer. While this is an enforcement method, the study finds that the angle tends to put companies in defense from Get-Go, negatively affecting the relationship between the IRS controller and the company and possibly negatively affect the end result of the tax audit.

For the analysis, the study performs 26 interviews with tax executives (tax executives and VPS) in companies trading public US companies. These interviews have allowed executives to share detailed experiences and examples of their interactions with IRS, state tax authorities and international tax services. The interviews were semi-structured, which meant that although we had a list of questions we wanted to cover, there was flexibility to leave the flow of conversation on unused topics and ideas we had not foreseen.

Given the type of analysis, the answers have led to several amazing findings. Seidman notes that three, in particular, are related to how executives respond to the control process. “We were surprised by the extent to which tax executives share information with their peers, essentially comparing notes with competitors about specific tax agents and audit strategies. Secondly, Seidman emphasizes that” when tax executives perceive controls as unjust.

Finally, Seidman states: “In addition to the negative comments addressed to the IRS on the training or education and culture of the agent, the respondents also comment regularly how far from the IRS they are technological, especially compared to Europe and Australia.” This point highlights the need for IRS to invest more in its natural infrastructure to remain at the same level as the tax authorities of other sophisticated nation.

The study concludes that the tax authority can develop new and more effective ways of conducting their controls in the new era of budgetary restrictions and financial statements. Concerning policy -makers, Stomberg says they can “examine whether the current system, especially the frequent” friction game “between tax authorities and taxpayers during large audits, represents the optimal use of resources.

A new direction for tax audits

Given the mission highlighted for a new modern IRS, this study provides several important routes that can be considered to be able to achieve this modernization without sacrificing the tax authority’s handle to finance the federal government. For example, if financial statements have already adequately reviewed the tax index disclosures, I may use this information that is already available to prevent tax from compliance. The IRS can even reach until it works with the controls governing the instruments such as PCAOB for the development of standards that can provide greater supervision than the tax information reported to the public. This concept is even more heavier with the forthcoming change in financial accounting standards on tax companies’ disclosures, which FASB implements starting in 2025. Finally, while it costs money to boost IRS technology, it seems that an investment can be justified.

However, many of the possible improvements appear to be derived from the tone and the relationship between the tax authority and the tax executives. The study shows significant differences between education, experience and tax auditors, and even between countries. For example, study participants welcome HMRC from the United Kingdom in these dimensions as opposed to US auditors. These proposals come at a critical time when the federal government wants to reduce 20% of IRS employees in 2026, according to The accounting magazine. Despite these cuts, IRS is currently circulating improvements in the control process, such as the recent adoption of improved Pre-qualification program to help the certainty between corporate taxpayers. If the US can continue to invest more in its auditors and technology, then a cost -effective way can emerge to effectively achieve better tax audits.