By FATIMA HUSSEIN and CHRIS MEGERIAN
WASHINGTON (AP) — Just days after being promoted to acting IRS commissioner, the whistleblower who testified publicly about investigations into Hunter Biden’s taxes is out again, according to three people familiar with the decision.
Gary Shapley, who previously testified to Congress as Republicans reviewed the business dealings of Joe Biden’s son, will be replaced by Deputy Treasury Secretary Michael Faulkender, according to the three people, who were not authorized to speak publicly about the move and spoke to The Associated Press on the condition of anonymity.
Faulkender will be the fourth IRS leader since President Donald Trump took office in January, a sign of the turmoil within the agency in the early months of the president’s second time in the White House.
Shapley’s short-lived tenure comes as a stream of high-ranking officials have exited the federal tax collection agency via a mix of resignations over Trump’s policy decisions, layoffs and demotions.
Shapley’s ouster and subsequent replacement were first reported by The New York Times, which said Treasury Secretary Scott Bessent had complained to Trump that Shapley had been installed without his knowledge and at the behest of Trump adviser Elon Musk, who has butted heads with Cabinet officials in his role spearheading the Department of Government Efficiency.
Late Thursday night, Musk shared an X post from Laura Loomer, a far-right activist who has criticized certain administration officials for a lack of loyalty to Trump, a Republican.
Loomer accused Bessent of inviting a “Trump hater” to work with him on financial literacy efforts. “I am going to personally tell President Trump and personally show him these receipts,” Loomer wrote, adding “shame on” Bessent.
Musk responded, “troubling.”
Bessent said in an emailed statement that “trust must be brought back to the IRS” and that he is confident that Faulkender “is the right man for the moment.” He added that Shapley “remains among my most important senior advisors at the U.S. Treasury as we work together to rethink and reform the IRS.”
As a result of the latest upheaval, the IRS has put a temporary pause on its reduction in force plan, according to two of the people also familiar with Shapley’s ouster. The pause in layoffs is due to the whiplash changes in leadership at the tax collection agency, the people said.
Earlier this month, the IRS began layoffs that could end up cutting as many as 20,000 staffers — up to 25% of the total workforce.
Shapley had been installed to replace Melanie Krause, who resigned from her role as acting IRS commissioner over a deal between the IRS and the Department of Homeland Security to share immigrants’ tax data with Immigration and Customs Enforcement to help it identify and deport people illegally in the U.S.
Krause had replaced acting Commissioner Douglas O’Donnell, who announced his retirement from the agency after roughly 40 years of service in February as furor spread over DOGE gaining access to IRS taxpayer data.
Trump’s nominee to head the IRS, former U.S. Rep. Billy Long of Missouri, has not yet been confirmed.
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