By Richard Rubin

WASHINGTON -- Senate Democrats pressed President Trump's pick to run the Internal Revenue Service on his promotion of tribal tax credits and recent acceptance of campaign donations from people tied to those claims.

Sen. Ron Wyden (D., Ore.) detailed how Billy Long was paid more than $65,000 to refer friends to a firm that sold purported tax credits that the IRS has told Democratic lawmakers don't exist. Then, according to official filings, people connected to those credits donated to Long's dormant political campaign after Trump picked him to lead the IRS. Those donations effectively went directly to Long, because he used money from them and others to retire a $130,000 debt that the campaign owed to him.

"This just looks corrupt," Wyden said during Long's confirmation hearing in the Finance Committee. "The American people have the right to know whether their future IRS commissioner is somebody who has been a crook."

Long, a former Republican congressman who left office in 2023 and became a tax adviser, said all he did was make referrals and encourage people to consult their own tax experts. He declined to say whether the tribal tax credits are real.

"I can't answer yes or no," Long said. "I think the jury's still out on that."

Long said the campaign donations were reported publicly as required but he deflected senators' questions about his communications with tax-credit promoters and information about how those donations were solicited. He also said he would follow conflict-of-interest guidance and requirements from ethics officials.

During Tuesday's hearing, Republican senators didn't attack Long's business work since leaving office. They didn't defend it either, instead focusing on his plans to improve taxpayer service and generally expressing support for his nomination. If Republicans stick together, they will be able to confirm Long through the chamber, where the GOP has a 53-47 majority. None has expressed public opposition to the pick.

After the hearing, Senate Finance Committee Chairman Mike Crapo (R., Idaho) said Long explained his tax-credit work very well and said he supported his nomination. Crapo wouldn't answer directly when asked whether he thinks the tribal tax credits were real.

"You've heard it stated. And I'm not an expert," he said. "I heard it said that the IRS says that they aren't there. If that's what the IRS says, that's what they said."

If confirmed, Long would run the IRS until November 2027, filling the remainder of the term of Danny Werfel, who was nominated by former President Joe Biden. Since Werfel's resignation on Inauguration Day, the IRS cycled through four acting commissioners, and many of the agency's senior officials left. Deputy Treasury Secretary Michael Faulkender is currently in charge.

The agency faces a series of difficult challenges, including cybersecurity, taxpayer privacy and technology upgrades. It shed thousands of workers earlier this year as the Trump administration reversed the enforcement expansion that started during Biden's term in the White House.

Long said he wants to improve taxpayer service and employee morale, making himself available to agency workers. "If people will give me a chance to show what I can do, I think we can do some very successful things at the IRS," he said.

Recent IRS commissioners have either had significant management experience or tax experience. Long is a different sort of pick. He is a gregarious former auctioneer who represented a Republican district in southwest Missouri from 2011 to 2023, and several of the Finance Committee members are his former House colleagues. While in Congress, Long wasn't very involved in tax policy, but he was an early and vocal Trump supporter.

After leaving Congress, Long began promoting tax credits, including the employee retention tax credit, a pandemic-era program that the IRS said was filled with fraud and ineligible claims.

He also referred people to Capitol Edge Strategies, a company that worked with tribal tax-credit promoter White River Energy. People affiliated with those credits helped retire Long's campaign debt earlier this year, sending money to the campaign fund he had used in a failed bid for U.S. Senate in 2022.

In an April statement, White River said that some tribal tax credit claims have been accepted on tax returns and that the company hasn't been told directly that the credits are invalid. The IRS can accept tax returns and issue refunds and then audit later.

Democrats also asked Long about what he would do to prevent Trump from using the IRS against his political enemies.

Sen. Elizabeth Warren (D., Mass.) pressed Long to say what federal law says -- that the president can't request that the IRS audit or investigate any particular taxpayer. Trump has said the administration would revoke Harvard University's tax-exempt status.

After several minutes of parsing the statute aloud during the hearing with Warren, Long wouldn't exactly say that the president requesting revocation of tax-exempt status is illegal. He did say he would report illegal requests to the IRS inspector general.

"If it's illegal, I'm not going to allow it to happen," he said.

Warren said Long shouldn't be within 1,000 miles of the IRS commissioner's office. "You'd have a lot more credibility if you'd just say yes," she said.

Long said later that he would make sure that the IRS wouldn't and should not be politicized on his watch.

Write to Richard Rubin at richard.rubin@wsj.com

(END) Dow Jones Newswires

May 20, 2025 13:41 ET (17:41 GMT)

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