The Senate Finance Committee questioned Billy Young, President Trump’s nominee for Internal Revenue Service commissioner, about his plans for the beleaguered agency and promotion of dubious “tribal tax credits” and Employee Retention Tax Credits during a long-awaited confirmation hearing Tuesday after a series of acting commissioners temporarily held the role.

Trump announced in December he planned to name Long, a former Republican congressman from Missouri, as the next IRS commissioner, even though then-commissioner Danny Werfel’s term wasn’t scheduled to end until November 2027. Since then, the role has been filled by four acting commissioners who have faced pressures to accept drastic staff cuts at the agency and share taxpayer data with immigration authorities.

Long insisted during the confirmation hearing that he would defend the integrity of the IRS and maintain an open door policy, emulating the example of former commissioner Charles Rossotti, who served from 1997 to 2002.

“If confirmed, I will implement a comprehensive plan aimed at enhancing the IRS, but also one that develops a new culture at the agency,” he said in his opening statement. “I am eager to implement the necessary changes to maximize our effectiveness, while also remaining transparent with both Congress and taxpayers. It is important to also recognize the dedicated professionals currently at the IRS whose hard work too often goes unnoticed. It is my pledge that we will invest in retaining skilled members of the team. This does not mean a bloated agency, but an efficient one where employees have the tools they need to succeed.”

Committee chairman Mike Crapo, R-Idaho, expects to see changes at the agency. “Congressman Long is very clear that he will make himself available to all IRS employees, no matter their seniority,” Crapo said in his opening statement. “Moreover, he wants to implement a top-down culture change at the agency. This sea change will benefit American taxpayers, who too often view the IRS as foe, rather than friend. Congressman Long knows, from years of experience in the House, that to be a successful Commissioner, he must be a valuable partner in Congress’ efforts to ensure that new tax legislation is implemented and administered as Congress intends it to be.  I am also confident that he will be fully transparent and responsive to Congress and the American people.”

Sen. Ron Wyden, D-Oregon, the top Democrat on the committee, questioned Long about his promotion of “tribal tax credits” and the fraud-plagued ERTC. “Most of Congressman Long’s experience with tax issues came after he left Congress, when he dove headlong into the tax scam industry,” he said in his opening statement. “Cashing in on the credibility of his election certificates, he raked in referral fees steering clients to firms that sold faked tax shelters and pushing small businesses to unknowingly commit tax fraud.”

Wyden asked Long about the $65,000 he earned from referring friends to tax promoters who claimed they had acquired income tax credits issued to a Native American tribe and then sold the tax credits to investors. “There’s a problem. The IRS said in March that the credits do not exist. They’re fake. They are a scam. Now you’re asking to be put in charge of the IRS, and the IRS confirms that these aren’t real. Tell the committee, do you believe these so-called tribal tax credits actually exist?”

Long insisted his only involvement with the credit was to connect interested friends and offer to put them on a Zoom call with someone, but he was not on the Zoom calls himself. Wyden pressed him on whether the tax credits actually exist.

“I think the jury’s still out on that,” Long admitted. “I know since 2022 they’ve been accepting them, so now they claim that they’re not. I think that all this is going to play out, and I want to have it investigated, just as you do. I know you’re very interested in this subject. I am too.”

Wyden also asked about $165,000 in campaign donations that went to Long’s unsuccessful 2022 Senate campaign after Trump named him as the next IRS commissioner. Long insisted he had followed guidelines from the Federal Election Commission. “You know as well as I do, anytime you’re dealing with the FEC, you have to follow FEC guidelines, and that’s exactly what I did all the way,” he said.

Wyden then asked him about his work with promoters of the Employee Retention Tax Credit. “You stated on a YouTube video that everybody qualifies for the Employee Retention Tax Credit, and you urge listeners to ignore CPAs that said they didn’t qualify. Do you really think everybody qualifies?”

“If you listen to that video, I hate to correct you, but I didn’t say everyone qualifies,” Long responded. “I said virtually everyone qualifies, meaning most people.”

Sen. Elizabeth Warren, D-Massachusetts, and other Democrats also questioned Long about whether he would follow Trump’s orders to audit certain taxpayers or remove the tax-exempt status of organizations, even if it violated the law. Long insisted he would follow the law but declined to explicitly say whether he would defy an order from Trump.

“I don’t intend to let anybody direct me to start an audit for political reasons,” he said.

Minnesota approved a bill on Monday night to create additional pathways to CPA licensure, and it awaits the signature of Gov. Tim Walz.

As part of an omnibus bill, Senate File 3045, it creates two new pathways to CPA licensure: a bachelor’s degree plus two years of experience, or a master’s degree plus one year of experience. The new pathways will be effective Jan. 1, 2026. 

The bill sunsets the current 150-hour credit rule after June 30, 2030, and establishes automatic mobility and practice privileges one day following the bill’s ratification. All candidates must still pass all parts of the CPA exam.

Jill Clardy/stock.adobe.com

“It’s a step forward in the right direction,” said Geno Fragnito, government relations director at the Minnesota Society of CPAs. “It allows some flexibility to hopefully bring in people who are on the fence about whether they could afford the extra year of education and whether the accounting profession fit into their long-term goals because of that.”

Generally, the governor has 14 days to act on the presented bill. Otherwise, without any action, the bill becomes law. Minnesota is one of more than a dozen states that have already passed changes to licensure requirements in an ongoing effort to address the profession’s talent shortage.

(Read more: “New ways to CPA”)

Minnesota was the first state to propose licensing changes in December 2022. 

“Initial strong opposition eventually turned into support as more professionals, state societies, universities, government entities and businesses rallied behind broadening pathways to CPA licensure with the first state, Ohio, passing its law in January,” said an MNCPA blog post.

“There were a lot of people — chairs ahead of me and other people on the board and at the Minnesota society — that have done a ton of work on this and really deserve a lot of credit for all of the conversations they had and the testifying they did,” said MNCPA chair Eric O’Link. “We’re very appreciative of our legislative sponsors and everybody who helped make it a reality.”

No more paper checks; death and tax debt; the perfect time to onboard software; and other highlights from our favorite tax bloggers.

Truths and consequences

• Wolters Kluwer (https://www.wolterskluwer.com/en/solutions/tax-accounting-us/industry-news): The snowflake in the blizzard: President Trump has signed an executive order effectively eliminating the U.S. government’s long-standing practice of issuing paper checks — including refunds — to eliminate inefficiencies, reduce costs and enhance payment security. Key provisions of the order and what it could mean to the profession.
• Institute on Taxation and Economic Policy (https://itep.org/category/blog/): The House tax plan, by the numbers.
• The Wandering Tax Pro (http://wanderingtaxpro.blogspot.com/) And the good, bad and ugly about that big, beautiful bill.
• Taxpayer Advocate Service (https://www.taxpayeradvocate.irs.gov/taxnews-information/blogs-nta/): How a “commonsense” proposal in Sec. 903 of the draft TAS Act would simplify estimated tax payments with evenly spaced due dates.
• Taxnotes (https://www.taxnotes.com/procedurally-taxing): IRC provisions governing consolidated returns are grounded in the identification of an “affiliated group of corporations” (or an “affiliated group”) for which a consolidated return may be made. A few foundational matters and fact patterns to spot an affiliated group. 
• Current Federal Tax Developments (https://www.currentfederaltaxdevelopments.com/): A U.S. appeals court recently addressed a critical issue for estate tax practitioners: the deductibility of transfers mandated by a prenuptial agreement as “claims against the estate.”
• Withum (https://www.withum.com/resources/): When companies face new tariffs or increases to existing ones (who doesn’t, these days?), mechanisms that can be implemented are bonded warehouses, the Customs Reconciliation Program or setting up a foreign trade zone. Plusses and minuses of each, including tax considerations.
• Dean Dorton (https://deandorton.com/insights/): How tariffs factor into inventory accounting for income tax purposes, as well as pitfalls that can trigger unfavorable tax consequences.

To the Swift 

• Taxjar (https://www.taxjar.com/resources/blog): Starting a new biz is likely a time-sucking thrill-a-minute for clients. Take one thing off their to-do list with this sales tax compliance checklist.
• TaxProf Blog (http://taxprof.typepad.com/taxprof_blog/): Taylor Swift’s hard-earned reputation as a savvy music mogul inspires other creative spirits to be “fearless” in their artistic endeavors. But a taxpayer’s financial ability to live out their wildest dreams may depend on their chosen medium.
• The Sales Tax People (https://sales.tax/expert-articles/): The latest that e-commerce clients need to know about marketplace facilitator laws. 
• Sovos (https://sovos.com/blog/): While we’re on the subject, what is sales tax, anyway? A step-by-step look.
• Trout CPA (https://www.troutcpa.com/blog): What to remind them about the FICA Tip Credit.
• The National Association of Tax Professionals (https://blog.natptax.com/): This week’s “You Make the Call” looks at Leo, owner of a small HVAC business who recently hosted a summer kick-off barbecue at his shop for his five technicians (he also participated). No customers or other management staff attended. Leo provided sodas, juice, burgers and brats. Is the cost of the food and beverages fully deductible or subject to the 50% limit?
• Boyum & Barenscheer (https://www.myboyum.com/blog/): Two financial planning tools to help manufacturer clients weather uncertainty.
• Yeo & Yeo (https://www.yeoandyeo.com/resources): Never mind the soul. What happens to debt, including tax debt, when someone dies?

Making connections

• Vertex (https://www.vertexinc.com/resources/resource-library/filter/field_asset_type/blog?page=0): Companies seek a lot of benefits from a “connected commerce” strategy. But the pace of change in retail is intense, and tax leaders need to keep an eye on how many shifts can affect compliance. 
• Mauled Again (https://mauledagain.blogspot.com/): Are tax pros sufficiently social to lower their risk of dementia? 
• CLA (https://www.claconnect.com/en/resources?pageNum=0): After three filing seasons with Schedules K-2 and K-3, patterns and pain points have emerged. Introduced to improve the reporting of international tax info, these schedules have had far-reaching impacts even for real estate and private equity partnerships with little or no foreign activity.
• TaxProCenter (https://accountants.intuit.com/taxprocenter/): Once firms invest in a new tax engine, onboarding and data conversion go on the back burner as firms deal with extended returns. This seemingly logical and unavoidable shift sets the stage for potential mayhem come January. Five reasons extension season is a great time for onboarding.
• The Rosenberg Associates (https://rosenbergassoc.com/blog/): Favorite headline of the week: “To PE, or Not to PE, Is That the Question?”