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Rettig’s Legacy: The Straight-Shooting COVID Commissioner

Posted on Nov. 11, 2022

As outgoing IRS Commissioner Charles Rettig’s term as head of the agency comes to a close, observers agree that his legacy is indelibly linked with the COVID-19 pandemic.

Rettig’s term officially ends November 12, when he’ll be handing responsibility for the agency over to temporary successor Douglas O’Donnell, deputy commissioner for services and enforcement. By then, Rettig will have served just over 1,500 days as head of the IRS.

Without fail, everyone who spoke with Tax Notes agreed that the dominant theme of the Rettig era was his handling of the pandemic, but observers were split when evaluating his performance. Some offered unmitigated praise.

“I think it’s more than fair to say he did an exemplary job,” given the difficult cards he was dealt, said Jorge E. Castro of Miller & Chevalier Chtd.

That’s not to say the IRS was a smooth-sailing ship under Rettig’s term, Castro acknowledged, noting the ongoing processing delays and gaps in phone service. “But it’s unfair to look at those challenges in a vacuum. You need to step back and look at the big picture here,” he said.

Leslie Book of Villanova University Charles Widger School of Law echoed that sentiment. “A lasting legacy of Commissioner Rettig is his ability to lead the agency during very challenging times. On balance, the commissioner generally did an extraordinary job with a very tough task at hand,” he said.

According to Phyllis Jo Kubey, former president of the New York State Society of Enrolled Agents, “Most folks will remember Chuck’s tenure as the pandemic era.” The IRS’s many shortcomings during this period will probably be what stick out most in their memories of his term. But that’s unfortunate because it overlooks how he led the IRS to overcome the pandemic-induced challenges, like rapidly issuing three rounds of economic impact payments or nimbly transforming the agency into a remote-capable workforce.

“I’d like to know who could’ve done better,” Kubey added.

Not everyone was so lavish in their praise. Some observers leveled substantive criticisms of the departing commissioner.

“For better or worse, he’s going to be remembered as the COVID commissioner,” said Joe Kristan of Eide Bailly LLP. “And fairly or not, he was at the helm during an era of unprecedented processing chaos at the agency.”

‘The Dark Side’

Many in the return preparer community who initially cheered Rettig’s confirmation, confident that the longtime former tax litigator would be well positioned to understand and address the needs of tax professionals, now say they feel a bit jilted.

The low level of service on the practitioner priority service phone line and limited avenues for digital communication between the IRS and professionals were disappointing, Kubey admitted. “I think we all expected more and didn’t see” the agency taking actions to make it easier for practitioners to serve their clients, she said.

Kristan described Rettig’s handling of the distribution of economic impact payments throughout the pandemic as an amazing accomplishment. But there was “a dark side” to his COVID-19 response too, he continued.

Rettig was “very grudging” about extending tax deadlines during the pandemic, according to Kristan, who felt that the IRS waited unnecessarily long to announce a filing season deadline extension in April 2020, then again inexplicably waited until the last minute to extend it in the 2021 filing season.

The IRS then opted to retroactively waive late-filing penalties that accrued during the pandemic, but even that felt like an insult to the tax professional community, Kristan said. “He could’ve done that at the time and saved everybody a lot of grief at a time when people were really struggling to get tax work done,” he explained.

The timing of those decisions put preparers through a lot of unnecessary stress, Kristan added.

R. Damon Rowe of Meadows, Collier, Reed, Cousins, Crouch & Ungerman LLP said the disappointment is understandable, but he defended Rettig, saying that the commissioner had to balance the need to collect revenue at the same time taxpayers were struggling.

“When you armchair quarterback, you could always say, ‘Oh, it should’ve been done earlier.’ . . . But he was really steadfast in his efforts to be even-keeled with Congress and the public,” Rowe said.

In Rowe’s view, Rettig pulled off a “great balancing act.”

Chief Cheerleader

The IRS took its fair share of punches for various shortcomings over the past few years, but in speeches and statements, Rettig seized every opportunity to stand up for the agency’s more than 80,000 employees.

“I think it’s the absolute best federal agency,” Rettig declared this summer. “And I guarantee you, it has the best workforce anywhere — and I know, I met tens of thousands of them.”

The commissioner regularly shared anecdotes of sitting with IRS customer service representatives on the phone while they assisted taxpayers through emotionally difficult circumstances or worked overtime to process a staggering pile of backlogged mail, or dispatching IRS Criminal Investigation agents to assist with disaster relief.

To Rettig, IRS employees are also deeply patriotic, putting their lives at risk to return to processing centers to do their duty and process mail in June 2020, all while enduring public scorn and serving as a political punching bag for many lawmakers.

“I put people in harm’s way before there were vaccinations, before there were sufficient masks,” Rettig acknowledged in remarks this summer. “I’ve told them to do things I never would’ve asked people to do in the private sector.”

“He was a cheerleader for the agency, and for its employees,” said Book. “He did a remarkable job connecting the IRS staff to their role as public servants and stuck to that message in a consistent, enthusiastic, and effective way.”

Rettig’s effusive praise for the agency’s employees probably went a long way toward keeping morale up, according to Kubey.

Kubey shared that during an in-person visit to the IRS headquarters in Washington, she stopped in the building’s cafeteria and saw Rettig chatting with agency employees, all of whom seemed cheered by his presence. On a nearby wall, she noticed a bulletin board covered with pictures of Rettig posing with staff for “selfies with Chuck.”

“I just thought, ‘This is the sweetest thing,’” Kubey recalled. “I do think his support of and advocacy for his workforce was meaningful.”

For his part, Rettig said he hoped IRS employees would remember him as the commissioner who “had their back 1,000 percent, because that’s absolutely true.”

El Comisionado del IRS

Observers noted that Rettig led a sustained effort to change the IRS into a multilingual agency.

Rettig’s determination to expand the number of languages with which the IRS can communicate with taxpayers was personal. Anyone who has had the opportunity to hear the commissioner speak will be familiar with his family history, as Rettig frequently brought up the non-English-speaking parents of his wife, whose family came to the United States as refugees after the Vietnam War, as well as his experience growing up in a diverse Los Angeles neighborhood.

According to the commissioner, the IRS essentially operated in just four languages when he began his term — and that was unacceptable. “I’m not somebody who subscribes to, ‘If you live in the United States, you must speak English,’” Rettig said recently.

Rowe explained that Rettig was determined to ensure that “everybody in America who wanted to be tax compliant should be able to understand the forms and what they needed to do to be compliant.”

As part of that effort, the IRS provided the Form 1040 in Spanish for the first time for the 2020 tax year, offered additional language translations of many pages, and provided phone interpreter services for taxpayers calling the IRS in over 350 languages.

The IRS’s multilingual efforts thus far are “only the tip of the iceberg,” according to Rettig.

Book praised Rettig’s efforts reaching non-English-speaking communities as a major accomplishment. “He really made a commitment to reaching out to underserved communities,” he said.

According to Kubey, the emphasis on languages was laudable and distinctly “Rettig-ian.” However, she acknowledged that she didn’t see much impact from that effort in her own experience with clients — and it may have come with some trade-offs.

“We might now have such-and-such form in Mandarin, but nobody’s picking up the phone” at the agency to help with taxpayer problems, Kubey noted.

When it came time to issue the first round of economic impact payments, Rettig recalled that tax professionals reached out to him, asking how they could help. “My immediate response was, ‘We need to get these outreach materials in different languages,’” he said during an October 21 speech at the Freeman Law International Tax Symposium. “It was less than two weeks that we got our materials back in 35 different languages,” he touted.

“It was kind of amazing,” Kubey said, recalling that moment. “He just kept putting the word out there, and people would step up.”

Rettig’s Stamp

Some observers gave credit to Rettig for a variety of forward-thinking internal IRS initiatives.

Rowe praised Rettig for rightly identifying digital assets’ high potential for tax avoidance and fraud and making cryptocurrency a top priority for the IRS. That was evidenced by the agency’s formation of a digital asset team and the Office of Fraud Enforcement — which was headed by Rowe — as well as the purchase of blockchain-scanning software licenses and a focus on training to keep IRS agents abreast of the latest cryptocurrency developments, he said.

Rettig was also responsible for the addition of a new question about digital assets that was conspicuously moved to the top of the front page of the Form 1040, according to Rowe.

“He was instrumental in that; that’s how important it was to him,” Rowe said.

Rettig was a strong advocate for the IRS’s rollout of voice bots, a project that was supposed to take a few years to be ready but was re-prioritized by Rettig to help deal with the agency’s paltry level of phone service. “Rettig made that happen,” Rowe emphasized.

Several observers also noted that Rettig’s background as a tax controversy partner seemed to manifest itself in the form of special enforcement-related initiatives, like the IRS’s targeting of syndicated conservation easements and microcaptive insurance transactions. Those are areas Rettig would’ve understood from private practice, and he seemed to have “dug in and made them a focus,” said Castro.


Rettig regularly pushed Congress to provide consistent, sufficient, long-term funding for the agency to modernize and perform all the tasks lawmakers demand of it. And in the end, he got what he wanted and then some: nearly $80 billion extra to spend over 10 years.

How much credit Rettig deserves depends on who’s asked. The funding wasn’t an altruistic gift from lawmakers to the longtime funding-starved agency; instead, the $80 billion functioned as a down payment on the nearly $200 billion in additional revenue the agency was estimated to bring in through improved enforcement to help offset the revenue loss from other provisions of the Inflation Reduction Act (P.L. 117-169). Well over half the $80 billion is specifically allotted to enforcement.

For his part, Rettig was satisfied to share the credit with partners in the tax community, as well as his predecessors, whom he praised for steadfastly making the case for adequate funding during their own terms.

Nevertheless, Book concluded that even if Rettig wasn’t directly responsible, he certainly contributed to the agency’s finally getting its funding boosted. The commissioner was an effective defender of the IRS in front of Congress, a “straight shooter” who at times could come off as aggressive, he said.

“You could tell he was a tax litigator — he’ll come at you,” Book added.

Castro, recalling his own experience at the IRS as a counselor to the commissioner in the early 2010s, argued that Rettig — a Trump administration appointee — deserves credit for not just getting Congress on board but convincing the Biden administration to make this a priority as well, which isn’t an easy task.

“He was able to rise above his appointment by the previous administration, and I think it’s fair to say that he was considered an honest broker,” Castro said.

The $80 billion has the potential to radically transform the IRS, but Rettig won’t be around for that, even though he laid the groundwork for it. Instead, the success — or failure — of the extra funding will most likely be linked with his successor. President Biden has nominated former acting IRS Commissioner Daniel Werfel, now a managing director of the Boston Consulting Group, to take the helm.

Regardless of who gets credit either for securing the funding or for how it’s spent, the IRS unmistakably has an enormous opportunity before it that it hasn’t had before. The agency being handed over to O’Donnell is still a dysfunctional one, perhaps even more dysfunctional than it was when Rettig first took the job, according to Kristan.

But there’s one clear exception, Kristan said: the $80 billion. “He’ll be leaving the new guy with an agency that will be much better positioned to start addressing some of the problems,” he said.

And that’s a conclusion shared by Rettig in his farewell address: “We are on the brink of an exciting new era for the IRS.”

Follow Jonathan Curry (@jtcurry005) on Twitter for real-time updates.

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