Talking Tax

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IRS Staff Downsizing Offers New Look at Private Sector Tax Work May 14, 2025

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With the massive wave of federal government layoffs, tens of thousands of workers from the IRS and other agencies are likely looking for new jobs, potentially in the private sector for the first time.

Caroline Ciraolo, a partner at Kostelanetz and founder of the firm's office in Washington, D.C., has started an initiative that connects former federal tax professionals with law firms and other private employers. She knows what it's like to make the transition: Ciraolo was the No. 2 official in the Department of Justice Tax Division from 2015 to 2017 before returning to the private sector.

In this episode of Talking Tax, Bloomberg Tax Editor at Large Rebecca Baker sat down with Ciraolo to discuss shifting out of government work, and how the "love of the practice area" is a key transferable skill.

"That passion for unpacking complicated transactions and complicated facts and circumstances, identifying the issues—those skills are equal on both sides," she said.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

IRS Workforce Cuts, Leadership Departures Ripple Across Agency May 07, 2025

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The IRS right now isn't the same agency it was at the start of this year.

That's because about 20% of IRS workers have signaled they want to leave or have been fired. The ripple effects of this exodus could go far, not just for the IRS itself, but for businesses and individual taxpayers trying to file their returns.

Roughly half of the 30 people at the top of the IRS organizational chart have left, many because of Trump administration decisions that stretch boundaries of the law. Those departures in particular erode an important layer of defense to the IRS's most important missions: taxpayer data security and a fair tax system, former and current agency officials said.

Most recently, two executives brought on to help the IRS build up its enforcement and reporting of digital assets left and were replaced by longtime IRS official Trish Turner.

The leadership departures, combined with the broader cuts across different levels of the agency, make it harder for the IRS to collect revenue for the government and provide help to taxpayers. The IRS plans to lean more heavily on technology to make up for the lost workers.

In this episode of Talking Tax, Bloomberg Tax reporters Erin Slowey and Erin Schilling discuss who's replacing executives who have left, the impacts of the high turnover, and what happens when workers who want to leave can't.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Why GOP Lawmakers Are Targeting the US Audit Board Apr 30, 2025

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House Republicans are pushing a plan to dismantle the US audit board and send its watchdog duties to the Securities and Exchange Commission as part of a federal budget-cutting process. It's not the first GOP attempt to rein in the Public Company Accounting Oversight Board, but this time it comes against the backdrop of the Trump administration's sweeping drive to cut regulations and downsize government.

Congress set up the board in the early 2000s to restore investor trust following high-profile corporate accounting scandals at Enron Corp. and WorldCom Inc.

The move to eliminate PCAOB threatens to derail independent oversight of auditors charged with vetting the financial reports of public companies worth trillions in stock value, according to Bloomberg Tax senior reporter Amanda Iacone.

On this episode of Talking Tax, Iacone speaks with Benjamin Freed, Bloomberg Tax team lead for state tax and financial accounting, about why the PCAOB is being targeted now, previous attempts to curb its influence, and what a potential disbanding could mean for audit firms.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Congress Returns With Ambitious Plans to Move on Tax Extensions Apr 23, 2025

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Before leaving for a two-week break, House Republican lawmakers adopted a Senate budget outline to expedite legislation to push through trillions of dollars in tax cuts, raise the debt ceiling, and slash billions in spending.

Now comes the hard part where policy committees need to fill in the fine details. The Senate framework called for $1.5 trillion in new tax cuts, to enact policies like some proposed by President Donald Trump on the campaign trail.

The Senate's use of a so-called current policy baseline wipes away, on paper, trillions of dollars expected to add to the deficit from extending the expiring parts of the GOP's 2017 tax law.

The House is seen as taking the lead, with Speaker Mike Johnson (R-La.) publicly aiming for a Memorial Day deadline to get a bill on Trump's desk.

In this episode of Talking Tax, Bloomberg Tax federal editor Kim Dixon talks to congressional reporters Chris Cioffi and Zach Cohen about what to expect in the next work period.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

IRS Workforce Cuts to Impede Progress on AI, Modernization Apr 16, 2025

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Deep cuts to the IRS workforce mean the agency might have to rely more heavily on technology to keep up taxpayer services and enforcement.

The IRS is set to lose 20,000 workers after the Trump administration's second deferred resignation offer. That's in addition to thousands who have already left or are on administrative leave.

Barry Johnson, former IRS chief data and analytics officer, oversaw the rollout of artificial intelligence at the agency before his retirement in January. When he left, he said the IRS was piloting an AI tool to help employees search the Internal Revenue Code. The agency also used AI to improve taxpayer services, such as with chatbots, and to make enforcement more efficient.

But the workforce cuts could hinder that progress, Johnson said.

"I'm especially concerned with proposed cuts in what we call the field staff, the folks who process tax returns and conduct audits," he said. "Because to the extent that we lose that subject matter expertise, our ability to train and validate AI applications will be diminished."

In this episode of Talking Tax, Johnson talks to Bloomberg Tax reporter Erin Schilling about the challenges of relying on technology with a shrunken staff, how the research division uses taxpayer data while upholding confidentiality, and what it means for the agency when top executives leave.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Tariffs, Trump's Global Tax Snub Hit OECD Negotiations Apr 09, 2025

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The Trump administration's massive new tariff pronouncements, on top of its pullback from the OECD’s global tax deal, have cast doubt on the future of global tax policy efforts.

The two-pillar OECD-led agreement seeks to create a 15% global minimum tax for large multinational corporations and change the way the companies allocate their profits among countries.

While the US is still taking part in some negotiations, it has rejected key elements of the deal that it says infringe on US tax sovereignty. The administration has especially taken issue with the deal’s undertaxed profits rule, which countries can use to tax companies from other jurisdictions if they aren't paying the minimum tax there. And it has raised objections to countries' imposition of digital services taxes.

On Wednesday, President Trump announced a 90-day pause on higher reciprocal tariffs that hit many US trade partners earlier in the day, and raised duties on China to 125%.

The conflict could spark a reaction away from global tax policy negotiations and toward more bilateral, one-on-one dealings between countries as nations look to retaliate or cut a deal with the US.

On this episode of Talking Tax, reporter Caleb Harshberger talks with PwC global tax policy leader Will Morris and Michael Plowgian, a partner at KPMG and former deputy assistant secretary for international affairs at the Treasury Department. They discuss the current state of negotiations, the complexity of numerous moving parts, and prospects for the US's ongoing role vis à vis the European Union and other nations.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

What the Changing IRS Workforce Means for Taxpayers Apr 02, 2025

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The hard-charging effort led by billionaire Elon Musk to reshape the federal workforce at the IRS and other agencies might lead to lasting changes. But what it means for taxpayers still isn't fully realized.

Some efforts to buy out or fire employees have been postponed until after the filing season ends in April, and are facing legal action.

Ending taxpayer assistance center leases and reducing the number of taxpayer assistance staff who can answer phones will mean backsliding in improved service levels, former National Taxpayer Advocate Nina Olson warns.

On this episode of Talking Tax, Olson talks to Bloomberg Tax reporter Chris Cioffi about the potential for brain drain at the agency amid a wave of resignations and whether major upheaval might lead to an erosion in taxpayer trust. They also tackle the danger of taxpayer data privacy violations as Musk's Treasury Department team gains access to the department's payment systems.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Corporate Transparency Act Rules Rollback Shakes Suits Mar 26, 2025

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Millions of US companies are off the hook when it comes to disclosing their beneficial owners' identities to the federal government, after the Trump administration announced it wouldn't enforce penalties for domestic entities under the Corporate Transparency Act.

The Treasury Department's previous regulations had required about 30 million businesses operating in the US to disclose who directly or indirectly controlled them in reports to the Financial Crimes Enforcement Network. But in a pivot from the previous administration, the Treasury now says all US entities are exempt from reporting requirements.

The move was the latest twist in a wave of litigation against the law, which some companies argue oversteps Congress's authority to regulate interstate commerce. Following a nationwide injunction blocking the CTA's enforcement in December 2024, businesses across the country faced whiplash as the law and the previous version of its implementing regulations were successively enjoined past the original January 2025 compliance deadline. But now, facing a narrower scope of which companies are obliged to comply under new rules, appeals courts must now grapple with whether newly exempt domestic companies retain their standing to sue.

On this episode of Talking Tax, Bloomberg Tax audio producer David Schultz talks with Bloomberg Law reporter John Woolley about the year-long legal drama around the Corporate Transparency Act, how the Trump administration disrupted that litigation, and how the Treasury's policy changes could impact the fight against international financial crime.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Tax Cuts, Credits Hang in Balance for NY Budget Talks Mar 19, 2025

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New York officials are in the final stage of the state’s budget process, following March 13 passage of the Assembly and Senate individual spending and revenue proposals for fiscal 2026. It's now up to a three-way negotiation between the Legislature's two chambers and Gov. Kathy Hochul (D), who has her own plans for a budget that’s likely to top $252 billion—including a host of tax changes that don’t completely align with what the Democratic-led lawmakers want.

As in recent years, lawmakers have proposed raising taxes on the highest-income earners and corporations, which Hochul has rejected in the past. There are divergent approaches to how much to expand the state’s child tax credit. And the Senate wants to tailor the governor's idea of sending New Yorkers sales tax rebates—a salve to inflation—to just seniors rather than all taxpayers. Other issues include an expansion of New York's film tax credit program to benefit more independent movies and whether the Metropolitan Transportation Authority's funding needs will disrupt the various tax proposals.

On this episode of Talking Tax, Bloomberg Tax state editor Benjamin Freed talks with New York correspondent Danielle Muoio Dunn and Bloomberg Government Albany correspondent Zach Williams about the budget process, the political stakes for Hochul ahead of her 2026 re-election campaign, and the odds that lawmakers wrap up the budget by their April 1 deadline—or at least the first night of Passover.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690.

Tariffs Shake Up Companies' Transfer Pricing Planning Mar 12, 2025

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Tax departments at multinational companies are scrambling to keep up with the Trump administration's tariff announcements as the updates pile in day to day and sudden shifts complicate transfer pricing calculations.

Tariffs raise companies' costs, and those can't always be passed on to consumers—meaning businesses have to choose where to allocate the costs in their supply chains. While the importing entity pays the tariffs, the company can adjust the transfer price to pass that cost to other, related entities.

That can present opportunities to reduce the impact of tariffs—but also may lead to risks of audits from tax and customs agencies.

And with so much unknown, it's become hard for companies to find tax certainty, said Summer Austin, partner at Baker McKenzie.

Austin and Baker McKenzie partner Jennifer Revis talked to Bloomberg Tax reporter Caleb Harshberger about what the tariffs mean for transfer pricing and how companies should respond.

Do you have feedback on this episode of Talking Tax? Give us a call and leave a voicemail at 703-341-3690

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