The Treasury Department’s top tax policy official is being forced out of the Trump administration after clashing with White House officials over legal limits on presidential involvement in Internal Revenue Service audits, according to The Wall Street Journal.
Kenneth Kies, the Treasury Department’s assistant secretary and the acting chief counsel of the IRS, is expected to depart in the coming weeks after disputes over tax enforcement and the administration’s interpretation of federal law.
Dispute centered on IRS audit law
According to people familiar with the matter, the conflict intensified during a recent meeting in which Kies warned administration officials that a proposed White House request could violate Section 7217 of the Internal Revenue Code.
That law prohibits the president, vice president, White House staff, and certain executive branch officials from directly or indirectly requesting that the IRS begin, end, or alter an audit or investigation of a specific taxpayer. The provision was enacted following the Watergate era to help shield the IRS from political interference.
Kies reportedly refused to participate in actions he believed would conflict with the statute.
White House grew frustrated
White House officials became increasingly frustrated with Kies, viewing him as an obstacle to advancing President Donald Trump’s tax agenda.
Beyond the audit dispute, the disagreements reportedly extended to the implementation of tax regulations and other policy decisions following last year’s major Republican tax legislation.
As The Wall Street Journal reports:
Kies, a longtime Republican tax attorney and lobbyist, was confirmed by the Senate in 2025 to oversee Treasury’s Office of Tax Policy. He also served as the IRS’s acting chief counsel, giving him broad authority over the agency’s legal interpretations and tax regulations.
For more than 20 years before joining the Trump administration, Kies ran his own tax lobbying firm, where his clients included Microsoft, cruise lines and insurance companies. He was a frequent campaign donor to Republican candidates, particularly members of the tax-writing committees.
Trump nominated him as assistant secretary for tax policy, and the Senate confirmed him on a party-line vote in June 2025, just before Congress enacted the major tax law that extended expiring tax cuts and included some of Trump’s priorities. Kies has been leading the agency’s implementation of that law, writing regulations that defined who was eligible to get new tax breaks for tipped workers and overtime pay.
In his Treasury job, Kies described himself as being pro-taxpayer, and he pushed for lighter regulations in many cases.
Kies also spent the past year as acting chief counsel of the IRS, giving him unusual authority in shaping and enforcing tax rules.
Departure adds to IRS leadership turnover
Kies’ exit comes during a period of significant turnover within the Treasury Department and the IRS.
His departure leaves another senior leadership vacancy as the administration continues implementing its tax agenda and defending a series of controversial IRS-related decisions that have drawn legal scrutiny in recent months.
Neither the Treasury Department nor the White House immediately commented publicly on the reported circumstances surrounding Kies’ departure.
READ NEXT: DHS Chief Says Prison ‘Absolutely On The Table’ For State Officials
