Vanessa Williamson (2:57)

Oh, thanks for having me. I'm glad to be here.

Jane Coaston (2:59)

What did leadership and personnel turnover at the IRS look like in 2025?

Vanessa Williamson (3:04)

Well, it's like nothing I've ever seen before. We lost a quarter of IRS workforce and more than three quarters of senior leadership. And that's not political positions. That's people who are career civil servants who've been there for decades under both kinds of administrations. We've just lost an enormous amount of professionals, an enormous amount of experience.

Jane Coaston (3:23)

What does this loss of personnel mean to taxpayers who might need to talk to someone at the irs? I know I've had to do that in the past. If they call the irs, will they get someone?

Vanessa Williamson (3:33)

Not as many people working those lines as there used to be. They realized late this year this was true at a number of different agencies. I think that they had fired a lot of people that they actually really needed and they rushed to try and hire at the end of the year, but they didn't get it done for some really important positions. They've only hired about 2% of the staff that they need. So they're already predicting a lower level of service, as they call it, that, that is to say, the likelihood of your phone call getting through. But I think we could see really serious delays if you call with questions to the irs. And that's really sad because the IRS had made major investments in recent years and it was really on an upswing.

Jane Coaston (4:08)

So that low staffing means for the average taxpayer that calling to ask a question probably isn't going to work.

Vanessa Williamson (4:15)

I mean, you can try. The thing about the IRS is they're used to being understaffed. They're used to being under resourced. They're used to being under scrutiny. And so they'll work really hard. They're used to trying to get it done for the taxpayers. Everyone knows it's an important time for our millions and millions of Americans. So they're going to try, but they're just, you can't make yourself into more people if you're the person answering the phones. And so I think, yeah, it's likely that you'll be seeing delays kind of like we saw at Social Security last summer.

Jane Coaston (4:39)

In previous years, the IRS has reported gaps of nearly $700 billion between what taxpayers owe and what the federal government has actually received. Is that tax gap likely to grow due to understaffing at the IRS?

Vanessa Williamson (4:52)

Absolutely. So it's important for people to know that $700 billion is what the American people are leaving on the table. Right? That's because people aren't paying their fair share, you won't be surprised to learn, mostly from people at the top underreporting their income. So, yeah, it's a huge sum, and it's very, very likely to grow because this is an area where we had been staffing up again under the Biden administration. There had been real efforts to increase enforcement at the top. Well, a lot of those folks were new, and so a lot of them were the first to go this last year. And so enforcement's going to be in decline. And that means that reven revenue is going to go down in the longer term.

Jane Coaston (5:27)

What does that mean in terms of that lack of revenue? What does that do to us? Because I know that for lots of people, the IRS is an entity that exists largely to annoy you, but, like, where would that money be going?

Vanessa Williamson (5:43)

Right? So first of all, I should say it's absolutely right that the IRS currently is administering, like, an annual quiz to the American people. It's very irritating, right? You have to, like, fill out your paperwork, and if you have a regular job, the IRS already knows the answer to the questions. Right.

Jane Coaston (5:57)

There's this joke I saw where it's like, you know, the IRS is like, we know all the answers to this quiz, but we're not going to tell you what those answers are. You have to guess them. And if you're wrong, you owe us thousands of dollars.

Vanessa Williamson (6:08)

Right? So this is something that the IRS was trying to fix. They don't love this either, right? I mean, why would they want to have to go through all the paperwork? So there was this thing that they launched in 2024 called Direct File, which was a program that was free public tax preparation. Right? You could go and do your taxes directly with the irs, and you don't have to pay someone to do it. And then last year, they were starting to roll out what's called pre pop, the jargony term for when the IRS would put in the data that they already know. And of course, you could fix it and correct it, and they don't know everything. Maybe you got a second job, maybe you had a kid. There are things the IRS doesn't know and you'd want to be able to fix it. But, yeah, there was an effort to solve this exact problem, but unfortunately, that's one of the many things that was shut down this year. So, yeah, the frustrations will continue, I'm afraid.

Jane Coaston (6:50)

Last year, the IRS agreed to share data with ice, a massive betrayal of the trust of many immigrant taxpayers because many immigrants, including undocumented people, pay taxes. What do we know about the data that's been shared since that agreement was made?

Vanessa Williamson (7:03)

Yeah, so a lot of civil servants said that this violates the law and they tried to stop it. And when they couldn't stop it, they left because it's illegal. The IRS have been promising for 30 years that your tax information is safe, that it is safe to file if you're undocumented. In fact, that it was part of the pathway to citizenship. And we betrayed that trust this year. The amount of damage we've done to public perceptions of the security of their tax data this year is an extraordinary loss. The irs, nonetheless, many people at IRS tried to slow this down and tried to make sure it was as limited as it could be. What we thought was true was that There were about 47,000 people whose tax information had been shared with ICE. Well, just last week, a news story broke that said that there's actually thousands more and that this was an error. And that's what happens when you lose the class of people who were doing this work who saw it as their life's mission to keep your data safe. Well, we lost a lot of those people. And so now we're in some real trouble.

Jane Coaston (8:00)

Something I've been hearing a lot about, because it's coming from the Trump administration, is that tax refunds are going to be really big this year. First, will refunds as a result of Trump's so called one big beautiful bill actually be noticeable for many taxpayers? And also, why will refunds be bigger in the first place?

Vanessa Williamson (8:19)

So it's a little bit of a silk purse out of a sow's ear situation. When you have a larger refund, it means that the IRS was withholding more than they should have been. Now, that may be because they didn't know about a change in your tax situation, but a lot of it this year is because they didn't update things, because the bill came through late, because they made a bunch of complicated changes, because there's very few people to do the work of implementing the tax law. And of course, we also shut down the government. So a lot of work that could have gotten done. And you could have adjusted your withholding in some ways. Well, it wasn't done until late on, so maybe your refund will be larger. I want to caution people to be really careful about not expecting too much out of these refunds. And it is a real problem that when a lot of big sales are made about, like, oh, your refund is going to be so huge, it really plays into the hands of scammers. One of the major things the IRS is doing is preventing identity theft, preventing people from getting scammed on their taxes and getting their refunds stolen. So the refunds that you were expecting are probably a little lower than you expect. Let me give you a couple examples. You might have heard no tax on overtime. Well, it's actually no tax, not on time and a half, but on the half it's a little smaller. You might have heard no tax on tips. Well, it's limited. And probably if you're a tipped worker, you don't make enough to owe anyway. So there are a lot of ways in which these benefits look kind of good. They look sparkly and shiny. They're probably a little smaller than you expect. And I would be very, very careful about picking a tax preparer who says they're going to get you some huge refund this year because I think it's been oversold.

Jane Coaston (9:48)

Have previous presidents also tried to use bigger tax refunds to their benefit? Did that strategy work, or is this something new for the Trump administration? Because I know that, like, the idea of lowering your taxes is one thing. The idea of increasing your tax refund is a different thing altogether.

Vanessa Williamson (10:05)

Yeah, I mean, sure. Talking about lower taxes, that must sell because all the politicians do it all the time. What they might not realize is that Americans forget really fast. So George Bush did this big thing to give everyone a tax break. People didn't remember it. After a year, nine out of 10 people had forgotten it happened. Obama did the same thing, got the same complete lack of credit for it. People didn't know their taxes had gone down. So, yeah, I mean, there's a lot of rhetoric about low taxes and politicians on both sides of the aisle use it. But the reality is there's very little payoff, mostly because people don't notice their tax situations change from year to year. So you don't always get the same size refund and you don't really know whether it was policy or something about your job or maybe your withholding was wrong. So, yeah, so I think the payoffs are pretty small here, actually.

Jane Coaston (10:51)

Who stands to benefit? The Most from the latest Trump tax cuts.

Vanessa Williamson (10:54)

Oh, the very wealthy. This was the most regressive tax policy ever in the history of our income tax. Yeah, it was a huge, huge, huge break to those at the very top. They sprinkled some shiny objects onto these temporary tax cuts like I mentioned about no tax on overtime or tips. But the bulk of this money went to the people at the very, very top. So it's a meaningful implications in terms of the consolidation of wealth in this country.

Jane Coaston (11:17)

So you talked about avoiding scams when getting your taxes prepared. What other advice do you have to people in our audience as they do their taxes this year as something we all kind of avoid doing and hate doing and find annoying?

Vanessa Williamson (11:31)

Look, the main piece of advice, maybe not what people want to hear, it's do your taxes early, right? Get your refund, get it done. One of the things about doing it early means that it will give scammers less time to have filed on your behalf. Also that it'll give you more time. You won't be coming in the big rush with everyone else. And so it'll probably get your refund out the door a little faster if you're getting it done right at the beginning. One thing I would love is for the American people to pay a little bit more attention to this huge, huge economic decision that we make right every year. All the decisions we make about the tax code sound so boring and so arcane and so unfair. But the reality is that, look, if you care about things like the consolidation of wealth, if you care about inequality, a huge part of that comes through our tax codes. So pay attention and watch out. You know, watch out for when you're getting sold a line about some special tax break that maybe isn't so great after all.

Jane Coaston (12:22)

Vanessa, thank you so much for joining me.

Vanessa Williamson (12:26)

Thank you.

Jane Coaston (12:27)

That was my conversation with Vanessa Williamson, Senior Fellow at the Brookings Institution. We know the news can be taxing and we're grateful you've chosen us to prepare it for you. So if you like the show, make sure to subscribe. Leave a five star review on Spotify and Apple podcasts, watch us on YouTube and share with your friends. More to come after some ads and I promise, no more tax jokes. What a Day is brought to you by Zebiotics. Let's face it, after a night with drinks, I don't bounce back the next day like I used to. I have to make a choice. I can either have a great night or a great next day. That is until I found pre alcohol Zebiotics, Pre alcohol Probiotic Drink is the world's first genetically engineered probiotic. It was invented by PhD scientists to tackle rough mornings after drinking. Here's how it when you drink, alcohol gets converted into a toxic byproduct in the gut. It's a buildup of this byproduct, not dehydration, that's to blame for rough days after drinking. Pre alcohol produces an enzyme to break this byproduct down. Just remember to make pre alcohol your first drink of the night. Drink responsibly and you'll feel your best tomorrow. Every time I have pre alcohol before drinks, I notice a difference the next day. Even after a night out, I can confidently plan on working out without worrying. Ready to try it? Go to zebiotics.com wadnow. You'll get 15% off your first order when you use WAD at checkout. Plus, it's backed by a 100% money back guarantee, so there's no risk. Subscriptions are also available for maximum consistency. Remember to head to zebiotics.com wad and use the code WAD at checkout for 15% off. Water Day is brought to you by Factor. Factor makes healthy eating easy with fully prepared meals designed by dietitians and crafted by chefs. What goes inside a Factor meal? Quality functional ingredients including lean proteins, colorful veggies, whole food ingredients and healthy fats. No refined sugars, no artificial sweeteners, no refined seed oils and meals that fit your goals and schedule. Healthier eating, calorie management, more protein. You get 100 rotating weekly meals to keep things fresh and delicious throughout the winter. Options include High Protein Calorie, smart Mediterranean diet, GLP1 support, and ready to eat salads. Plus, the new MusclePro collection supports strength in recovery. Your meals are always fresh, never frozen, and they're ready in about two minutes. I love to cook, but Factor is the next best thing. Head to FactorMeals.com wad50off and use code WAD50OFF to get 50% off and free breakfast for a year. Eat like a pro this month with Factor New subscribers only. Varies by plan. One free breakfast item per box for one year. While subscription is active, when something matters.

Teladoc Health Advertiser (15:03)

To you, you take charge. Your health shouldn't be any different. That's why I got Teladoc Health through my Tricare Benefits at no cost to me. Teladoc Health offers support for weight management, diabetes and hypertension. Check to see if you're eligible today@teladochealth.com.

Vrbo Advertiser (15:17)

Tricarewest@Vrbo, we understand that even the best of plans sometimes need a little support, so we've planned for the plot twists. Every booking is automatically backed by our VRBO Care Guarantee, giving you confidence from the very start. Whenever you need help, it's ready before your stay, through the moments in between, and after your trip. Because a great trip starts with peace of mind and maybe a good playlist. But we've got the peace of mind part covered.

Jane Coaston (15:46)

Here's what else we're following today. Head of Lines.

Kevin Hassett (15:52)

I mean, the paper is an embarrassment. It's, I think, the worst paper I've ever seen in the history of the Federal Reserve System. The people associated with this paper should presumably be disciplined because what they've done done is they've put out a conclusion which has created a lot of news that's highly partisan based on analysis that wouldn't be accepted in a first semester econ class.

Jane Coaston (16:15)

National Economic Council Director Kevin Hassett was very mad at the New York Federal Reserve when speaking to CNBC on Wednesday. Why? Because the New York Federal Reserve published a paper that stated that 90% of the economic burden of Trump's tariffs have fallen on US consumers and companies. Because it has. The paper, posted February 12, isn't new information. Other sources, including the Congressional Budget Office and Harvard Business School, have reported the same American consumers are paying for Trump's tariffs to the tune of about $1,000 per household in 2025, according to the non Partisan Tax Foundation. That's because American companies are passing on the costs they're paying for imported goods, costs generated by the tariffs to you. And even Hassett's explanation of how this is all working out great for Americans has a sticking point for consumers.

Kevin Hassett (17:03)

So the basic theory of President Trump's tariffs is that there are sure, we're importing stuff from China, but we got producers in the US that make the same stuff, maybe at a slightly higher price. If we bring the stuff home, create the demand at home, then that will hurt China and drive up wages in the US And American consumers will be better.

Jane Coaston (17:25)

Did you catch that? The part about prices being higher? Hmm. That would seem to go against the Trump administration's own logic on tariffs, as spelled out in a Wall Street Journal op ed written by President Trump. That piece argued that foreign countries would eat the cost of tariffs and lower prices, which is not how tariffs, which are supposed to raise the cost of imported goods work. But apparently basic economic facts are a problem for the Trump administration. Time to fire some people. Meta CEO Mark Zuckerberg took the stand in a Los Angeles courtroom on Wednesday. Zuckerberg's testimony is part of an unprecedented trial that questions whether social media platforms like Meta's Instagram deliberately addict and harm children. Meta denies the accusations. The plaintiff, who is now 20 years old, claims her early use of social media addicted her to the technology and exacerbated depression and suicidal thoughts. While on the stand, Zuckerberg was asked about young people's use of Instagram, his previous congressional testimonies, and internal advice he's received about not coming off like a human robot. Seems like that advice didn't take. Meta platforms and Google's YouTube are the two remaining defendants in the case TikTok and Snap Inc. Settled. The Arizona Senate will vote on a plan that would require federal immigration officers at all polling places in the state. The proposal would compel each county to make an agreement with the Trump administration to provide federal immigration law enforcement presence anywhere ballots will be submitted during the 2026 general election, which means Arizonans could run into Immigration and Customs Enforcement officers not just on Election Day, but also at drop boxes and early voting locations. Sounds like a great way to suppress voters. The plan makes clear it is not authorizing federal immigration agents or election officials to question, detain or arrest voters just to determine their eligibility. So how would they know you're American, esp. Trump Gear Looking White the Trump administration is pushing back against a court order to restore an exhibit on people enslaved by George Washington in Philadelphia. Last month, National Park Service workers abruptly removed exhibits referencing slavery from the site on Independence Mall. This prompted the city to sue. A US Senior judge granted an injunction on Monday and ordered the display to be restored while the lawsuit proceeds. In the ruling, the judge as if the Ministry of truth in George Orwell's 1984 now existed with its motto Ignorance is strength. This court is now asked to determine whether the federal government has the power it claims to dissemble and disassemble historical truths when it has some domain over historical facts. It does not, of course. The Trump administration has filed a notice of appeal. Between this and his bizarre shout outs of all of his black friends on Wednesday, Trump is doing a great job honoring Black History Month. And that's the news. Before we go. This week on Runaway Country, Alex Wagner is joined by historian Heather Cox Richardson to unpack how Donald Trump reshaped Washington not just politically, but physically. They dig into what the changes to DC's built environment reveal about power, legacy, and how leaders try to leave their mark. A new episode of Runaway country is out now. Listen wherever you get your podcasts or watch on YouTube. That's all for today. If you like the show, make sure you subscribe. Leave a review. Let me investigate whether or not Reese's Peanut Butter Cups really taste different than they used to and tell your friends to listen. And if you're into reading, I'm not just about how the grandson of the inventor of Reese's Peanut Butter Cups is alleging that Hershey's is cutting corners by changing some of the ingredients. Like me, what a Day is also a nightly newsletter. Check it out and subscribe. Subscribe@crooked.com subscribe I'm Jane Coston and Hershey's responded by saying it hasn't changed how Reese's Peanut Butter Cups are made. I believe only I can solve this problem by eating a lot of Reese's Peanut Butter Cups. What a Day is a production of Crooked Media. It's recorded and mixed by Desmond Taylor. Our associate producer is Emily Foer. Our producer is Kaitlyn Plummer. Our video editor is Joseph Dutra. Our video producer is Johanna Case. We had production help today from Greg Walters and Matt Berg. Our senior producer is Erica Morrison and our senior Vice President of News and Politics is Adrienne Hill. Our theme music is by Kyle Murdoch and Jordan Kanter. We had help today from the Associated Press. Our production staff is proudly unionized with the Writers Guild of America. Easy.

Vrbo Advertiser (22:24)

Day or night, VRBoCare is here 247 to help make every part of your stay seamless. If anything comes up or you simply need a little guidance, support is ready whenever you reach out. From the moment you book to the moment you you head home. We're here to help things run smoothly because a great trip starts with the right support. And hey, a good playlist doesn't hurt either.

Teladoc Health Advertiser (22:53)

Tired of juggling sales tools or spending hours on prospecting just to book a few meetings? Meet Apollo, the go to market platform for finding leads, connecting with buyers and closing deals all in one place. Apollo gives you access to over 210 million contacts and AI that handles all your busy work, finding leads, drafting emails and even prioritizing your day. So stop paying for five different sales tools when one does it all. Visit Apollo I.O. and sign up free today.