Sheldon Cohen, former IRS commissioner
Sheldon Cohen, a tax lawyer and certified public accountant who helped set up the first presidential blind trust, for Lyndon B. Johnson, and then helped computerize the IRS as commissioner of the Internal Revenue Service, died Sept. 4 at a nursing home in Chevy Chase. He was 91. The cause was complications from congestive heart failure, said a grandson, Reuben Goetzl.
Mr. Cohen, a native Washingtonian and son of a Lithuanian-born shopkeeper, graduated first in his law school class at George Washington University in 1952. He then joined a cadre of young lawyers at the IRS who drafted an overhaul of the federal income tax code.
His role shaping the new code, which took effect in 1954, vaulted him to prominence. He left government work for private practice and was recruited to the firm of Arnold, Fortas and Porter. One of the partners, a confidant of President Johnson and future U.S. Supreme Court Justice Abe Fortas, became Mr. Cohen’s mentor.
Shortly after President John F. Kennedy’s assassination in November 1963, Mr. Cohen said, he was headed to services at his synagogue when Judge Fortas summoned his protege. President Johnson, newly elevated from the vice presidency to the presidency, needed his business affairs put in order immediately.
The Johnsons had long owned a radio and television station in Austin. “I was the only one who wanted to sell the radio station on the basis that it was a terrible conflict,” Mr. Cohen said in an oral history with the Jewish Historical Society of Greater Washington. “Fortas looked at me and said, ‘He’ll kill ya.’ He agreed to set up a blind trust.”
Mr. Cohen had experience creating such trusts, which allow investors to maintain their assets but avoid the conflicts of interest that might arise through their daily management.
He returned to the IRS in 1964 as chief counsel. President Johnson named him commissioner the next year, a time when the agency was beginning to adopt computer technology for processing returns. Such mechanization, which allowed the agency to track each taxpayer with a number, stoked fears of government overreach.
Mr. Cohen argued that the modernized system would more efficiently identify and discourage tax fraud. When it came time to use the state-of-the-art IBM system, however, he proceeded cautiously and ordered that tax returns be tabulated by computer and then checked by hand.
He faced congressional scrutiny when the agency’s history of aggressive enforcement practices, including wiretapping in serious criminal cases, came to light. But “the most embarrassing thing that happened to me in office was that millions of persons below the poverty line had to pay taxes,” he said in 1969 as he championed a system in which the poorest Americans would not pay income taxes.
Charlotte Crane, a professor and tax historian at Northwestern University’s law school, said Mr. Cohen’s work led to adoption in 1975 of the federal Earned Income Tax Credit, a refund meant to offset payroll taxation for low-income filers.
Sheldon Stanley Cohen was born in Washington in 1927. His first experience in finance, he said, was helping his father with deliveries at the family business, Potomac Butter and Egg. After graduating from Coolidge High School in 1945, he served in the Navy at the end of World War II. He received a bachelor’s degree from George Washington University in 1950.
A longtime resident of Montgomery County, he was an officer in Jewish, community and legal groups. He advised foreign countries on their tax systems.
His wife of 67 years, the former Faye Fram, died in April. Survivors include children Melinda Cohen of Adamstown, Laura Apelbaum and Jonathan Cohen, both of Chevy Chase, and Sharon Cohen of Cabin John; a brother; a sister; and 10 grandchildren.