The Taxpayer First Act would redesign the agency and boost identity theft protection.
In a rare show of bipartisanship, the House on Monday passed a bill to restructure the Internal Revenue Service to enhance taxpayer appeal rights, modernize technology and encourage whistleblowers. The “Taxpayer First Act” cleared the House by voice vote.
Originally introduced in March but revised last week, the bill (H.R. H3151) was drafted by Ways and Means Committee members John Lewis, D-Ga., and Mike Kelly, R-Pa., with a Senate counterpart.
“This bill is a ray of hope,” said Lewis in a statement on Friday before the vote. “It is a significant win for the American people because it demonstrates that even in the most difficult times, we can come together as a nation, as a people, and as a Congress to accomplish important things for the American people. We developed this bill the way legislation should be created. We listened to the voices of taxpayers, advocates and experts. We asked questions for many months. The Oversight Subcommittee hosted hearings and roundtables. Democratic and Republican members shared their concerns and ideas. We negotiated. We took our time, and believe that we did it right.”
Lewis stressed that the bill creates a new independent taxpayer appeals progress and also helps low-income, disabled people and senior citizens by imposing new requirements on private debt collectors.
The bill also would add new cybersecurity protections and improve interactions with the IRS for victims of identity theft. And it would codify the Volunteer Income Tax Assistance program, allowing the IRS up to $30 million for matching grants to qualifying tax preparation sites.
In working out potential problems with the Senate, House members agreed to drop provisions that would codify the controversial Free File program, under which the IRS partners with private tax-preparation companies in offering free online tax services to needier taxpayers.
Sen. Chuck Grassley, R-Iowa, chairman of the Finance Committee, praised the House for passing the bill, stressing the importance of the whistleblower protections in allowing more communication from IRS staff. “Not many people look forward to interacting with the IRS,” said Grassley, who introduced the Senate version with Sen. Ron Wyden, D-Ore. “The process can be long, confusing and tedious. That’s particularly true for taxpayers who encounter frustrating situations that may seem unfair. It’s true for whistleblowers who aren’t treated respectfully and it’s true for ordinary taxpayers who want to make sure their privacy and security are protected.”