The Internal Revenue Service may never be the government’s most popular agency, but it could have been the most efficient.

In 2022, Congress passed the Inflation Reduction Act, which invested $80 billion to fix the Internal Revenue Service. In 2024, the agency rolled out features like Direct File, a new free filing service for taxpayers. But Elon Musk's DOGE had other plans, including mass firings and data sharing agreements with ICE. The result is new risks for taxpayers.

Host: Anne Kim, Washington Monthly

Guest: Danny Werfel, former IRS Commissioner

Chapters

00:00 Introduction to Danny Werfel and IRS challenges

01:01 The importance of the IRS and public perception

02:04 The referee analogy and public trust

02:57 Modernization goals and digital interactions

05:30 Impact of current administration on the IRS

06:29 Performance before and after the Inflation Reduction Act

07:55 Reversal of modernization efforts in 2025

09:22 Lack of a clear modernization plan from the IRS

11:20 Recent IRS performance and taxpayer frustrations

12:21 Consequences of underfunding and staffing issues

16:39 The size and capacity of the IRS compared internationally

20:43 Doge's mistakes in IRS reform

23:05 Spending, capacity, and efficiency in government

27:08 Risks of rapid reform and the reflecting pool analogy

37:34 The concept and benefits of direct file

40:57 Challenges and opportunities in free file solutions

44:19 The future of IRS reform and innovation