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Since leaving Congress in 2023, Billy Long has peddled a pandemic-era tax credit that the I.R.S. has warned is a magnet for fraud.
Dec. 6, 2024Updated 10:27 a.m. ET
When Billy Long, now President-elect Donald J. Trump’s pick to lead the Internal Revenue Service, left Congress in 2023, he quickly set out to make money. Building off the relationships he developed as a Republican from Missouri and auctioneer, Mr. Long began encouraging people to file for a lucrative, pandemic-era tax credit.
At meetings with chapters of Hispanic Chambers of Commerce across the country and at an auctioneering convention in Oklahoma, Mr. Long sometimes wore a hat advertising the Employee Retention Tax Credit as he tried to drum up business. Working with companies that would fill out the paperwork for the tax credit in exchange for a portion of a client’s refund, Mr. Long had success.
“What’s working for me is the trust factor because people know me,” he said in a podcast interview last year about his work, describing clients who received tax refunds of more than $1 million. “They’ve known me for 40 years in the auction business, or whatever they see me getting this money for their compadres,” he added.
The money spigot would soon shut off. In September 2023, the I.R.S. temporarily stopped processing claims for the credit, hoping to squash widespread fraud in the program. The tax break, aimed at supporting businesses that kept employees on payroll during the pandemic, had spawned a cottage industry of tax preparation firms steering people, including those who were not eligible for the credit, toward it. The I.R.S. began warning people about scams related to the tax credit, including firms that were “wildly misrepresenting and exaggerating who can qualify for the credits.”
The fiscal cost of the tax refund bonanza was steep. What analysts had initially expected would be a roughly $55 billion program had ballooned into a $230 billion one, with projections that its cost could ultimately hit $550 billion.
Mr. Long, in the 2023 podcast interview, said he would help only clients who were actually eligible for the credit, and added that the fees he and his associates collected would be returned to any clients that had their tax refund revoked by the I.R.S. The companies he said he worked with — Commerce Terrace Consulting, which says on its website that it has provided $400 million in tax savings, and Lifetime Advisors — did not respond to a request for comment.
