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The Taxman
March/April 2006
by Dan Froomkin ’85

Mark W. Everson ’76 is one alumnus whom almost every Eli hears from every year—in the message that accompanies your federal tax form. Everson was appointed in May 2003 to a five-year term as commissioner of the Internal Revenue Service. He talked with Dan Froomkin '85, who writes the “White House Briefing” column for washingtonpost.com, about his experience in Washington’s most thankless job.

Y: You have more than 100,000 employees working for you, you oversee a $10 billion budget, you collect $2 trillion in tax revenue a year. Yet I think it is fair to say that there is little love for the tax man. Are there times when you find it best that no one in the room knows what you do for a living?

E: Before I took this job I had an important but much more obscure position as one of two deputies at the Office of Management and Budget, overseeing management broadly across the government. If I were to meet people at a reception, there would inevitably be one person who would step forward and want to talk about government contracting or IT systems or financial systems. The other three people would just sort of stand there and mope around. Now the same thing sort of happens—but with a twist. One person steps forward and really wants to talk, but the other three people just slowly slide away.

Y: Have you ever unwittingly struck terror into someone’s heart?

E: Listen, I think interaction with the IRS is sensitive. I still get a little twitch when I go home and find an envelope in the mail with “Internal Revenue Service” on it. And all it is is some personnel notice, saying that there’s been a change in my dental benefits. Everybody has, let’s say, a healthy regard for the service.

Y: What initially led you to enter the public sector?

E: I finished at Yale in '76 and went to New York to work at [the accounting firm] Arthur Andersen. I was in New York for six years. And then in January '82 my sister was murdered. And there was a certain amount of soul searching—life is short, you ought to try and do something that you want to do. I had always had an interest in public service. A friend of mine from Yale, Robin Michel ['76], married the daughter of a man named Charles Wick, who was very close to President Reagan. I got to know Charlie, and I went to work in Washington at the U.S. Information Agency as an assistant to him. I was 28, and it was a one-year leave of absence. But as it turned out, I loved it and never looked back.

Y: You are now almost three years into your five-year term as commissioner. Give me a quick sense of what you hope your legacy will be.

E: Now there is a clear recognition that the IRS has to have a balanced program of services to taxpayers and enforcement of the law. There were inadequate services in the late '90s. Then there was a big effort to improve services, but it was done largely at the expense of enforcement. We continue to improve services, and now we’ve restored the credibility of the enforcement mechanism. And that’s very important, because average Americans pay taxes honestly and accurately. And they have every right to believe that when they do so, neighbors and competitors are doing the same.

Y: The IRS reports a $250- to $300-billion annual gap between the tax dollars owed and what’s being paid. If we, say, doubled your $10 billion budget next year, how much of that could we recover?

E: Through a combination of factors, billions of dollars could be reduced from the tax gap. Some of it is just getting the IRS to run better, which we’re working on. Some of it is increased funding for enforcement, which we have secured. And some of it is changes in reporting and other statutory provisions. For example, it used to be that you just had to list the name of a dependent on your tax form. But the Tax Reform Act of 1986 requires you to put down the name and Social Security number of the dependent. The year after it went into effect, five million dependents vanished.

Y: Dogs, cats . …

E: Yeah, apparently they had a dog named Rufus, not a son.

Y: You graduated from Yale College in 1976. Is it true that you couldn’t find a single other student at Yale who would say he voted for Richard Nixon in 1972?

E: My recollection is that I was the only freshman in Calhoun who would admit to voting for Richard Nixon.

Y: Do the people you work with know that in the spring of 1974 you ran naked through the Calhoun College dining hall?

E: It was mentioned [in the New York Times] by David Cay Johnston, so, yeah. But I think that’s a sight that they would prefer not to see repeated. I’ll give you another interesting fact: I was initially rejected from Yale. I really tanked my senior year at Exeter. And then I went overseas and worked at a poultry farm in Zambia for a year. And after that I reapplied. That apparently cured the record. There are probably only a handful of people who have been rejected and reapplied. I showed a little persistence and got in.

Y: How does your current job compare to your year on the poultry farm? Any analogy between slaughtering chickens and what you do now?

E: No, I wouldn’t say so.

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