Head of IRS Retiring; Fought Cheaters, Abusive Tax Shelters

Roscoe L. Egger Jr., who led the Internal Revenue Service on a five-year crusade against tax cheats and abusive tax shelters, is resigning as commissioner, the agency announced Friday.

Egger, 65, said he will quit no later than April 30. The certified public accountant and tax lawyer has headed the IRS longer than anyone since World War II. He left the Price Waterhouse & Co. accounting firm to become IRS commissioner in March, 1981.

During his tenure, he fought, with only partial success, attempts by the Office of Management and Budget to reduce the IRS operating budget as part of an overall cut in government spending. Egger contended privately that it made no sense to cut the resources of the agency that collected 92% of the government’s revenues.

Mobilized Agency

From almost the day he walked into IRS headquarters, Egger mobilized the agency behind efforts to collect some of the $100 billion a year in taxes that is lost through cheating and to halt proliferation of abusive tax shelters--investments designed to produce a tax write-off rather than a profit.

In addition, he targeted illegal tax protesters--those who file incomplete returns or make claims for tax-exempt status that the courts have rejected over and over.

Agency’s Worst Year

But, if recent events are what people remember most, Egger’s tenure will be recalled for the processing foul-ups in 1985 that he said made it the worst year in the agency’s history.

The problems were blamed chiefly on a new $103-million computer system installed in the 10 regional centers where individual returns are processed. Complaints focused particularly on those in Philadelphia, Austin, Tex., and Fresno, Calif.

Inadequate testing, lack of employee training and problems with instructions given to the computers combined to delay processing of millions of returns, delaying tax refunds for four months or more.