The bill calls on the IRS to restructure itself to remove duplicate offices and to improve its cyber defenses. It also asks the agency to consider having its Criminal Investigation Division report directly to the commissioner.
The bill would also eliminate the IRS Oversight Board, a nine-member panel that determines whether the agency’s structure and management allow it to carry out its mission. However, the board currently lacks enough members to hold a quorum.
The legislation would temporarily prohibit the IRS from sending private debt collectors to collect on debts from taxpayers earning 250 percent below the federal poverty level.
The federal poverty level is $12,140 for one person and $25,100 for a family of four.
While the IRS hired private debt collectors to collect more than $920 million in debts in fiscal 2017, they succeed in only recovering $6.7 million according to National Taxpayer Advocate Nina Olson.
The legislation would codify the IRS’ existing Free File program, a partnership with tax preparation businesses to ensure that the bottom 70 percent of taxpayers can file their tax returns for free. In 2017, that meant taxpayers earning $66,000 or less — more than 100 million taxpayers — were covered by the program.
“It is our goal to build a ‘Taxpayer First’ IRS that works for taxpayers, not against them,” House Ways and Means Committee Chairman Kevin Brady (R-Texas) said during an April 11 markup of the bill.
The 21st Century IRS Act would require the IRS to offer more of its services online and double down on its cybersecurity.
The bill would require the IRS to work with the private sector to protect taxpayers from identity theft, and would require the IRS to accept credit card payments online.
“It’s been two decades since Congress has considered legislation to overhaul the IRS, and we all understand the rapid changes our technology has experienced during this timeframe,” Rep. Mike Bishop (R-Mich.), the bill’s sponsor, said in a statement.
Taxpayer assistance centers
A bill sponsored by Rep. Karen Handel (R-Ga.) would require the Treasury Department to give public notice 90 days before the proposed closure of any taxpayer assistance center, and identify alternative sources of taxpayer assistance in the area.
The Treasury Department would also have to report to Congress the reasons for closing any taxpayer assistance center.