Skip to content

How Congress’ New Tax Bill Benefits Taxpayers

For the second year in a row, the U.S. Senate Finance Committee is proposing a piece of legislation that is intended to simplify tax returns and improve customer service for taxpayers. There is no government agency that Americans interact with more than the IRS, and the reality is that the IRS can be hard to reach, technologically behind the times, and just plain difficult. This bill intends to cut out some of the redundancies in the IRS and to streamline the filing process for all taxpayers. As with any piece of tax legislation, there are a few additions to this bill that you as a taxpayer need to know about. If you have questions about how this bill could affect you, contact me or get a free consultation today.

Main Improvements to the IRS

There are a few main benefits this bill would have for the infrastructure of the IRS itself. The bill would require the creation of a new IRS Independent Office of Appeals. This office would be open and available to all taxpayers as part of a new comprehensive administration review process. This office would make the IRS much more accessible to the average American. The bill would also require the IRS to provide taxpayers with the case files they have gathered during an audit. As of right now, taxpayers and businesses have no rights to the information on the case against them unless they request this through a Freedom of Information Act (FOIA) request.

One of the biggest difficulties for the IRS is just how outdated their infrastructure is. Everything from the digital storage technology they utilize to their ability to accept credit card payments without third-party vendors needs to be updated. This bill would provide funding for those advancements to be purchased and would set up another level of cybersecurity for taxpayer data.

Benefits to Taxpayers

As of right now, private debt collectors are heavily utilized by the IRS to gather funds from taxpayers who don’t have an installment agreement or can’t afford to pay. The unfortunate reality is that many of the people who can’t afford to pay are struggling financially or living under the poverty line. This bill intends to put limitations on who the IRS can go after with these third-party debt collectors, with specific intentions of easing the strain of those living below the poverty line.

The bill also requires serious updates to the IRS’s customer service abilities. Success with this will be measured against benchmarks and metrics in an effort to keep the IRS on track with this program. These improvements should benefit IRS employees and taxpayers alike should the bill pass.

Things to Look Out For

This bill is not all benefits and ease of access. There is also a proposed increase to the failure to file penalty. This provision would increase the penalty by around $100 per individual, so make sure that you file on time!

If you are paid in Bitcoin, you need to be aware that changes to tax laws are on the way. This untaxable and untraceable form of currency is currently a huge hole in tax laws that Washington is trying to account for. Make sure that if you are getting paid in or are trading in Bitcoin or any other form of cryptocurrency that you are keeping track of payments made and received.

If you have any questions about how these new proposed tax laws will affect you or your business, or just want to learn more about how you can get on the right track for 2019, then contact me today!