Spotlight on IRS Excise Tax Attorney Rachel S. Smith

Our Spotlight series highlights the careers and lives of tax professionals across the globe. This week’s focus is on Rachel S. Smith, a docket attorney in the national office of the IRS Office of Chief Counsel, where she specializes in excise taxes.

A Pittsburgh native, she came to Washington, D.C., after graduating from college. She liked the D.C. area so much that she stayed for law school and hasn’t left. She interned at the IRS in between her second and third years at American University and was hired full time after graduating in 2011.

Outside of work, Smith enjoys yoga and other forms of exercise, listening to podcasts, stocking up on homemade sugar cookies, watching “Succession,” and spending time with her partner and their adopted pit bull Freya.

What’s your official title, and what does it mean? I am a docket attorney in the national office of the IRS Office of Chief Counsel, in Passthroughs and Special Industries, Branch 7 (excise tax). The Chief Counsel’s Office serves as the principal legal adviser to the IRS, and we in the national office are organized by subject matter and technical expertise. I spend a lot of time interpreting the excise tax provisions of the Internal Revenue Code to advise the IRS and other agencies and branches of government if they ask.

We’re the front-line drafters of Treasury Regulations, Revenue Rulings and Procedures, and other sub-regulatory guidance, as well as legal opinion memos such as private letter rulings and Chief Counsel advice. We also provide informal oral advice to taxpayers and practitioners who need help interpreting the code, regulations, and other guidance.

Free time: book, audiobook, or podcast? I read every night before bed, and I love to listen to podcasts while I’m doing chores or exercising. My favorite podcasts are “The Daily,” “Freakonomics,” “Planet Money,” “This American Life,” and when I want to laugh, I listen to the pop culture podcast “Who? Weekly.”

Tax is a huge subject. What’s your area of special interest? I’ve specialized in excise tax since 2014. Excise taxes are indirect taxes that may be imposed on certain sales, uses, or other activities. Excise taxes and credits impact a wide variety of otherwise unrelated industries such as oil and gas, sports gambling, pharmaceuticals, and air transportation. Prior to joining the excise tax branch, I worked mainly with S corporations and partnerships. I also volunteer with the Volunteer Income Tax Assistance program during tax season, so I try to stay up to date on personal income tax issues affecting low-income taxpayers like the earned income tax credit, the child tax credits, and the stimulus payments.

What’s the last movie or show that you watched and loved—DVD, Netflix, or in the theater? I absolutely loved “Succession!” It was dramatic but also laugh out loud funny at times. I also always recommend “Fargo” (the TV series) to people who like clever, quirky, funny—but also gruesome and suspenseful—crime shows.

What college did you attend, and what did you study? I went to Penn State for undergrad and double majored in sociology and political science. I got my J.D. at American University Washington College of Law here in D.C.

Go to pick-me-up: coffee or tea? Coffee! I drink coffee every day, although I try to avoid it after noon. I even worked as a barista during college and law school.

What’s the best tax or financial advice that anyone ever gave you? I’m not sure if this counts as advice or not, but I like the Oliver Wendell Holmes quote that’s engraved on the front of the IRS building: “Taxes are what we pay for a civilized society.” It’s a good reminder during tax season!

If you weren’t working in the tax profession, what would your dream job be? My sister-in-law is deaf, and while I’ve taken several American Sign Language (ASL) classes, I haven’t been able to devote the time to becoming fluent. If I wasn’t a tax lawyer, I would go back to school to study ASL full time so that I could work with the Deaf community.

If you had the opportunity to make one change in the tax world—an extra credit, a disallowed deduction, whatever—what would it be? I would get rid of the disadvantages associated with the married filing separately (MFS) status or just do away with the MFS status altogether and let people choose whether or not to file with their spouse. I don’t understand why we penalize married couples who prefer to keep their finances separate.

Favorite food, snack, or candy during tax season or other busy time? I love pastries, so any sweet baked good! My mom is an incredible baker so when I visit her, I try to stock up on her sugar cookies.

What tax news or move made the most impact on your practice or clients this past year? I think the hottest excise tax issue at the moment is the return of the Superfund taxes. The original statute relating to the Superfund was known as CERCLA and was enacted in 1980. CERCLA created a hazardous substance cleanup program informally known as the Superfund. It was funded, in part, by excise taxes on sales and uses of certain chemicals and substances. The Superfund chemical taxes expired in 1995. The recent infrastructure bill reinstated these taxes with some modifications, and the new provisions go into effect later this year.

If you received a big tax refund check right now, what would you do with it? Set aside a portion to donate, a portion to invest, and a portion to treat myself!

Learn more about the IRS on its website.

If you’d like to recommend a tax pro to be featured, send your suggestion to rbaker@bloombergindustry.com with the subject: Spotlight. Please include the following information: tax professional’s name, title, email address, and geographic area (city/state/country).