Press Release #105-273
Chairman Roth to Unveil Comprehensive IRS Reform Legislation On Thursday (105-273)
Senate Finance Committee Chairman William V. Roth, Jr., will hold a press conference on Thursday, March 26, in room 215 Dirksen, beginning at 11:30 am.
Press Release #105-274
Roth IRS Reform Proposal The "Most Comprehensive Overhaul of The IRS Ever Proposed"
The IRS reform discussion draft released by Senate Finance Committee Chairman William V. Roth, Jr. on Tuesday adds scores of critically important new provisions to the House bill in the areas of oversight, employee accountability and taxpayer protection.
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Outline of Chairman Roth's Mark
Regarding Comprehensive IRS Reform Legislation (Word Perfect 6.1 File)
Press Release #105-275
Roth Delivers Comprehensive Overhaul of IRS
Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) Thursday unveiled his IRS reform legislation, calling it, "the most comprehensive overhaul ever" of the agency. Roth thanked all of the taxpayers and IRS employees who had spoken before the Finance Committee and contacted him, calling them, "the driving force," behind the legislation.
Press Release #105-276
Summary of Highlights of Chairman Roth's Comprehensive IRS Reform Legislation
This IRS reform proposal is the most comprehensive overhaul of the Internal Revenue Service ever proposed. It will protect taxpayers by increasing oversight of the agency, holding employees accountable for their actions and creating a new arsenal of taxpayer protections.
Press Release #105-277-1
Outline of Chairman's Mark of Comprehensive IRS Reform Legislation
I. Restructuring and Establishment of an IRS Board, II. Management, III. Transfer IRS Office of Chief Inspector Function to Treasury Inspector General, IV. Prohibition on Executive Branch Influence over Audits and Personnel Flexibilities, V. Electronic Filing
Press Release #105-277-2
Outline of Chairman's Mark of Comprehensive IRS Reform Legislation
VI. Taxpayer Protections, VII. Congressional Accountability
Press Release #105-278
Roth Bill Addresses Issues Raised By Witnesses In Hearings
Senate Finance Committee Chairman William V. Roth's IRS reform bill would have prevented many of the problems that taxpayers brought before the Finance Committee last fall and earlier this year.
Press Release #105-279
Finance Committee to Consider Comprehensive IRS Reform Bill Next Week
Senate Finance Committee Chairman William V. Roth, Jr., today announced the Finance Committee will markup the Chairman's mark on IRS reform on Tuesday, March 31, beginning at 10:00 a.m. and Wednesday, April 1, 1998, at 10:00 a.m., in Dirksen Room 215.
Press Release #105-281
Roth Releases Chairman's Mark
Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) Thursday night released his Chairman's Mark of the IRS reform bill, including a description of the offsets.
Press Release #105-282
Roth: Let's Choose Real Reform of The IRS Over Artificial Deadlines (105-282)
Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) today said that the expedited process for IRS reform that Senator Bob Kerrey and others are calling for would result in the watering down of many taxpayer protections and IRS oversight mechanisms in his comprehensive IRS overhaul bill.
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Revenue Charts for Chairman's Mark
of IRS Reform and Restructuring Legislation (Lotus 123 File)
Press Release #105-284 Errata
Errata to Chairman's Mark (Revenue offsets)
Effective date of Item V.B. Modify Foreign Tax Credit Carryover Rules should be revised to read as follows: The proposal would apply to foreign tax credits arising in taxable years ending after the date of enactment.
Press Release #105-284
Markup of IRS Reform Bill to Begin at 2pm on Tuesday (105-284)
The Senate Finance Committee will begin tomorrow's (March 31st) markup of IRS reform legislation at 2 PM in 215 Dirksen, not 10 am as previously announced.
Press Release #105-285
Finance Committee Unanimously Approves IRS Reform Bill(105-285)
The Senate Finance Committee tonight unanimously approved comprehensive legislation overhauling the Internal Revenue Service by a vote of 20 - 0.
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Estimated Revenue Effects of The SFC-Passed IRS ReformBill (Lotus File)
The Senate Finance Committee has scheduled a markup relating to Internal Revenue Service ("IRS") reform and restructuring proposals (including taxpayer protections), as well as tax technical correction provisions, on March 31, 1998. On March 26, 1998, the Chairman of the Finance Committee released his mark of these proposals.
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(Jcx-21-98) Description of Modifications
SFC Chairman's Mark Relating to Reform And Restructuring of The IRS and Tax Technical Correction Provisions
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(Jcx-23-98) Description of Additional Modifications
SFC Chairman's Mark Relating to Reform And Restructuring of The IRS and Tax Technical Correction Provisions
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(Jcx-24-98) Description of Accepted Amendments
SFC Chairman's Mark Relating to Reform And Restructuring of The IRS and Tax Technical Correction Provisions
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Estimated Revenue Effects
SFC Chairman's Mark of IRS Restructuring Bill (Lotus 123 File)
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Estimated Revenue Effects With Modifications
SFC Chairman's Mark of IRS Restructuring Bill (Lotus 123 File)
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Amendments to the IRS Restructuring Bill
(Word Perfect 6.1 File)
Press Release #105-296
Roth Announces Four Days of IRS Oversight Hearings(105-296)
Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) today announced that the Committee will hold four days of oversight hearings next week.
Estimated Budget Effects of Reform And Restructuring of The IRS
(Fy 98 - 2007)(Lotus 123 File)
Press Release #105-300:
Roth: IRS Hearings Are About Good Government, Not Partisan Politics
The following is the statement of Senate Finance Committee Chairman William V. Roth, Jr. (R-DE).
Press Release #105-301:
IRS Oversight Hearings Day One: IRS High Level Exec's Held to Different Standards Than Employees; Tax Attorneys Tell of Extreme Law Enforcement Techniques Used Against Clients
The Senate Finance Committee will hold the first of four days of oversight hearings on the Internal Revenue Service. The hearing will begin at 9:00 am in room 216 of the Hart Senate office Building.
Press Release #105-302:
Roth Opens Oversight Hearings On IRS
Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) Tuesday began four days of oversight hearings looking at a number of serious problems in the IRS. Roth's opening statement follows...
Press Release #105-304:
Day One of Hearings Shows Breakdown in IRS Disciplinary Process
During the first day of IRS oversight hearings Tuesday, Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) questioned representatives of the Treasury Inspector General's office about several cases in which the IRS was ineffective in disciplining serious misconduct.
Press Release #105-305:
Roth Applauds Appointment of William Webster toHead IRS'ss CID Review
Urges Task Force to Consider Transferring Some CID Responsibilities to Justice or DEA. Senate Finance Committee Chairman William V. Roth today applauded the appointment of William Webster to head the Internal Revenue Service's review of the Criminal Investigations Division. Roth's statement follows...
Testimony of Robert Edwin Davis
MR. CHAIRMAN AND MEMBERS of THE COMMITTEE: My name is Robert Edwin Davis. I am an attorney, and I have practiced law in Dallas, Texas for almost 40 years...
Testimony of J. Earl Epstein
Mr. Chairman, my name is Earl Epstein. I am a practicing lawyer and a member of a small law firm in Philadelphia, Pennsylvania. I appreciate the invitation to testify before this Committee...
Testimony of Philip A. MacNaughton
My name is Philip MacNaughton. I am a lawyer with offices in Houston, and my practice includes representing taxpayers before the Internal Revenue Service in tax controversies and collection matters...
Press Release #105-307:
Roth Opens Second Day of IRS Oversight Hearings
cid Abuse of Taxpayers; Racial Discrimination and CID Questionable Statistics Are Focus of Day Two. The Senate Finance Committee began the second of four days of oversight hearings on the Internal Revenue Service on Tuesday. The following is the opening statement of Senate Finance Committee
Outline of IRS Bill Reported By The Finance Committee
I. Restructuring and Establishment of an IRS Board ii. Management iii. Transfer IRS office of Chief Inspector Function to Treasury Inspector General iv. Prohibition on Executive Branch Influence over Audits and Personnel flexibilities V. Electronic Filing vi. Taxpayer Protections vii. Congressional Accountability viii. Revenue Provisions ix. Technical Corrections
Press Release #105-308:
Final Two Days of IRS Oversight Hearings to Begin at 9:30 AM
Senate Finance Committee Chairman William V.Rothh,Jrr., today announced that the Finance Committee will hear testimony on IRS practices and procedures on Thursday, April 30th and Friday, May 1st beginning at 9:30 a.m. in room 216 Hart.
IRS Restructuring and Reform Act of 1998
4-22-98 IRS Reform Bill
Table of Contents (This and following sections are in HTML Format.)
I. Legislative Background
A. Committee Action
The Committee on Finance marked up H.R. 2676 (the "Internal Revenue Service Restructuring and Reform Act of 1998") on March 31, 1998.
B. Commission Report
The National Commission on Restructuring the Internal Revenue Service (the "Commission") was established to review the practices of the IRS and to make recommendations for modernizing and improving its efficiency and taxpayer services.
II. Explanation of the Bill
TITLE I. Executive Branch Governance & Management of the IRS
A. IRS Restructuring & Creation of IRS Oversight Board
The IRS mission statement provides that: The purpose of the Internal Revenue Service is to collect the proper amount of tax revenue at the least cost; serve the public by continually improving the quality of our products and services; and perform in a manner warranting the highest degree of public confidence in our integrity and fairness.
B. Appointment & Duties of IRS Commissioner & Chief Counsel & Other Personnel
Within the Department of the Treasury is a Commissioner of Internal Revenue, who is appointed by the President, with the advice and consent of the Senate. The Commissioner has such duties and powers as may be prescribed by the Secretary.
C. Structure & Funding of the Employee Plans & Exempt Organizations Division ("Ep/Eo")
Prior to 1974, no one specific office in the IRS had primary responsibility for employee plans and tax-exempt organizations. As part of the reforms contained in the Employee Retirement Income Security Act of 1974 ("ERISA"), Congress statutorily created the Office of Employee Plans and Exempt Organizations ("EP/EO") under the direction of an Assistant Commissioner.
D. Taxpayer Advocate
In 1996, the Taxpayer Bill of Rights 2 ("TBOR 2") established the position of Taxpayer Advocate, which replaced the position of Taxpayer Ombudsman, created in 1979 by the IRS. The Taxpayer Advocate is appointed by and reports directly to the IRS Commissioner.
E. Treasury office of Inspector General; IRS office of The Chief Inspector
The Treasury Office of Inspector General ("Treasury IG") was established in 1988 and charged with conducting independent audits, investigations and review to help the Department of Treasury accomplish its mission, improve its programs and operations, promote economy, efficiency and effectiveness, and prevent and detect fraud and abuse. The Treasury IG derives its statutory authority under the Inspector General Act of 1978, as amended ("IG Act of 1978").
F. Prohibition on Executive Branch Influence Over Taxpayer Audits
There is no explicit prohibition in the Code on high-level Executive Branch influence over taxpayer audits and collection activity. The Internal Revenue Code prohibits disclosure of tax returns and return information, except to the extent specifically authorized by the Internal Revenue Code (Sec. 6103). Unauthorized disclosure is a felony punishable by a fine not exceeding $5,000 or imprisonment of not more than five years, or both (Sec. 7213). An action for civil damages also may be brought for unauthorized disclosure (Sec. 7431).
G. IRS Personnel Flexibilities
The IRS is subject to the personnel rules and procedures set forth in title 5, United States Code. Under these rules, IRS employees generally are classified under the General Schedule or the Senior Executive Service.
TITLE II. Electronic Filing
A. Electronic Filing of Tax and Information Returns
Treasury Regulations section 1.6012-5 provides that the Commissioner may authorize a taxpayer to elect to file a composite return in lieu of a paper return. An electronically filed return is a composite return consisting of electronically transmitted data and certain paper documents that cannot be electronically transmitted.
B. Due Date for Certain Information Returns
Information such as the amount of dividends, partnership distributions, and interest paid during the calendar year must be supplied to taxpayers by the payors by January 31 of the following calendar year. The payors must file an information return with the IRS with the information by February 28 of the year following the calendar year for which the return must be filed.
C. Paperless Electronic Filing
Code section 6061 requires that tax forms be signed as required by the Secretary. The IRS will not accept an electronically filed return unless it has also received a Form 8453, which is a paper form that contains signature information of the filer.
D. Return-Free Tax System
Under present law, taxpayers generally are required to calculate their own tax liabilities and submit returns showing their calculations.
E. Access to Account Information (Sec. 2005 of the bill)
Taxpayers who file their returns electronically cannot review their accounts electronically.
TITLE III. Taxpayer Protection And Rights:
A. Burden of Proof
Under present law, a rebuttable presumption exists that the Commissioner's determination of tax liability is correct. "This presumption in favor of the Commissioner is a procedural device that requires the plaintiff to go forward with prima facie evidence to support a finding contrary to the Commissioner's determination.
B. Proceedings by Taxpayers
Information such as the amount of dividends, partnership distributions, and interest paid during the calendar year must be supplied to taxpayers by the payors by January 31 of the following calendar year. The payors must file an information return with the IRS with the information by February 28 of the year following the calendar year for which the return must be filed.
C. Relief for Innocent Spouses & for Taxpayers Unable to Manage Their Financial Affairs Due to Disabilities
Relief from liability for tax, interest and penalties is available for "innocent spouses" in certain circumstances. to qualify for such relief, the innocent spouse must establish: (1) that a joint return was made; (2) that an understatement of tax, which exceeds the greater...
D. Provisions Relating to Interest and Penalties
A taxpayer that underpays its taxes is required to pay interest on the underpayment at a rate equal to the Federal short term interest rate plus three percentage points. A special "hot interest" rate equal to the Federal short term interest rate plus five percentage points applies in the case of certain large corporate underpayments.
E. Protections for Taxpayers Subject to Audit or Collection Activities
Levy is the IRS's administrative authority to seize a taxpayer's property to pay the taxpayer's tax liability. The IRS is entitled to seize a taxpayer's property by levy if the Federal tax lien has attached to such property.
F. Disclosures to Taxpayers
In general, spouses who file a joint tax return are each fully responsible for the accuracy of the tax return and for the full liability. Spouses who wish to avoid such joint and several liability may file as married persons filing separately. Special rules apply in the case of innocent spouses pursuant to section 6013(e).
G. Low-Income Taxpayer Clinics
There are no provisions in present law providing for assistance to clinics that assist low income taxpayers.
H. Other Provisions
The Code provides that it is lawful for the Secretary to accept checks or money orders as payment for taxes, to the extent and under the conditions provided in regulations prescribed by the Secretary (Sec. 6311). Those regulations state that checks or money orders should be made payable to the Internal Revenue Service.
I. Studies
The last major comprehensive revision of the overall penalty structure in the Internal Revenue Code was the "Improved Penalty Administration and Compliance Tax Act," enacted as part of the Omnibus Budget Reconciliation Act of 1989.
TITLE IV.Congressionaln Accountability for the IRS
A. Century Date Change
The bill provides that it is the sense of the Congress that the IRS should place resolving the century date change computing problems as a high priority. The bill also provides that the Commissioner shall expeditiously submit a report to the Congress on the overall impact of the bill on the...
B. Tax Law Complexity Analysis
The National Commission on Restructuring the IRS found a clear connection between the complexity of the Internal Revenue Code and the difficulty of tax law administration and taxpayer frustration.
TITLE V. Revenue Offsets
A. Employer Deduction for Vacation and Severance Pay
For deduction purposes, any method or arrangement that has the effect of a plan deferring the receipt of compensation or other benefits for employees is treated as a deferred compensation plan (Sec. 404(b)).
B. Modify Foreign Tax Credit Carryover Rules
U.S. persons may credit foreign taxes against U.S. tax on foreign source income. The amount of foreign tax credits that can be claimed in a year is subject to a limitation that prevents taxpayers from using foreign tax credits to offset U.S. tax on U.S. source income. Separate foreign tax credit limitations are applied to specific categories of income.
C. Clarify and Expand Mathematical Error Procedures
The IRS may deny a personal exemption for a taxpayer, the taxpayer's spouse or the taxpayer's dependents if the taxpayer fails to provide a correct TIN for each person for whom the taxpayer claims an exemption.
D. Freeze Grandfather Status of Stapled REITs
A real estate investment trust ("REIT") is an entity that receives most of its income from passive real estate related investments and that essentially receives pass-through treatment for income that is distributed to shareholders.
E. Make Certain Trade Receivables in Eligible for Mark-to-Market Treatment
In general, dealers in securities are required to use a mark-to-market method of accounting for securities (Sec. 475). Exceptions to the mark-to-market rule are provided for securities held for investment, certain debt instruments and obligations to acquire debt instruments and certain securities that hedge securities.
F. Add Vaccines Against Rotavirus Gastroenteritis to the List of Taxable Vaccines
manufacturer's excise tax is imposed at the rate of 75 cents per dose (Sec. 4131) on the following vaccines routinely recommended for administration to children: diphtheria, pertussis, tetanus, measles, mumps, rubella, polio, HIB (haemophilus influenza type B), hepatitis B, and A varicella (chicken pox).
Tax Technical Corrections Relating To:
Chairman's Mark
Section 1
Table of Contents, Introduction
Section 2
IRS Oversight Board, IRS Commissioner & Chief Counsel, Structure of Employee Plans & Exempt Organizations Division
Section 3
Taxpayer Advocate, Prohibition of Executive Branch Influence Over Taxpayer Audits, Treasury Investigator General, IRS Chief Inspector
Section 4
IRS Personnel Flexibilities, Electronic Filing
Section 5
Taxpayer Bill of Rights 3, Including Burden of Proof & Proceedings By Taxpayers
Section 6
TBOR 3, Continuation of Proceedings By Taxpayers & Innocent Spouses
Section 7
Interest & Penalties
Section 8
Interest & Penalties (Continued) & Protections For Taxpayers Subject to Audit Or Collection
Section 9
Protections For Taxpayers Subject to Audit Or Collection (Continued)
Section 10
Protections For Taxpayers Subject to Audit Or Collection (Continued), Disclosures to Taxpayers & Low-Income Taxpayer Clinics
Section 11
Other Taxpayer Rights Provisions, Studies & Seizure Authority
Section 12
Seizure Authority (Continued)
Section 13
Seizure Authority (Continued)
Section 14
Seizure Authority (Continued) & offers-In-Compromise
Section 15
Additional Items
Section 16
Congressional Accountability
Section 17
Revenue offsets
Mark of Technical Corrections Provisions
Technical 1
Description of Senate Finance Committee Chairman's Mark of Tax Technical Corrections Provisions
Table of Contents And Amendments to Title I of The 1997 Taxpayer Relief Act Relating to The Child Credit
Technical 2
I. Description of Technical Corrections to the Taxpayer Relief Act of 1997
Amendments to Title II of The Taxpayer Relief Act Relating to Education Incentives
Technical 3
I. Description of Technical Corrections to the Taxpayer Relief Act of 1997
Amendments to Title III of The The Taxpayer Relief Act of 1997 Relating toSavingss Incentives And Amendments to Title Iii of The 1997 Taxpayer Relief Act Relating to Capital Gains
Technical 4
I. Description of Technical Corrections to the Taxpayer Relief Act of 1997
Amendments to Title IV of The 1997 Taxpayer Relief Act Relating to Alternative Minimum Tax And Amendments to Title V of The Taxpayer Relief Act of 1997 Relating to Estate And Gift Taxes
Technical 5
I. Description of Technical Corrections to the Taxpayer Relief Act of 1997
Amendments to Title VII of The Taxpayer Relief Act of 1997 Relating to Incentives For The District of Columbia And Amendments to Title Ix of The Taxpayer Relief Act of 1997Relating to Miscellaneous Provisions
Technical 6
I. Description of Technical Corrections to the Taxpayer Relief Act of 1997
Amendments to Title X of The Taxpayer Relief Act of 1997 Relating to Revenue Raising Provisions (1 - 13)
Technical 7
I. Description of Technical Corrections to the Taxpayer Relief Act of 1997
Amendments to Title X of The Taxpayer Relief Act of 1997 Relating to Revenue Raising Provisions (14-17) And Amendments to Title XI of The Taxpayer Relief Act of 1997Relating Too Foreign Provisions
Technical 8
I. Description of Technical Corrections to the Taxpayer Relief Act of 1997 & II. Technical Corrections to Other Tax Legislation
Amendments to Title X II of The Taxpayer Relief Act of 1997 Relating to Simplification Provisions, Amendments to Title XIII of The Taxpayer Relief Act of 1997 Relating To Estate, Gift and Trust Simplification, Amendments to Title XV of The Taxpayer Relief Act of 1997 Relating to Pensions And Employee Benefits, Amendments to Title XVI ofThe Taxpayerr Relief Act of 1997 Relating to Technical Correction And Technical CorrectionsTo Otherr Tax Legislation
Technical 9
III. Differences Between Proposed Technical Corrections Contained in the Chairman's Mark & the Provisions of Title VI of H.R. 2676
Differences Between Proposed Technical Corrections Contained in The Chairman's Mark And The Provisions of Title VI of Hr 2676
IRS Restructuring Discussion Draft
Section 1
Restructuring & Establishment of an IRS Board
A. Statutory Language - Organizational Structure B. Establish an IRS Board
Section 2
Management
A. Commissioner of Internal Revenue (House bill) B. Require the IRS Chief Counsel to Report to the Commissioner C. Structure of Employee Plans & Exempt Organizations ("EP&EO" Division) (House bill) D. Taxpayer Advocate
Section 3
Transfer IRS Office of Chief Inspector Function to Treasury Inspector General
A. Transfer IRS Internal Security and portions of Internal Audit to the Treasury Inspector General. B. The Treasury Inspector General will be appointed by... C. The Treasury Inspector General, Deputy Inspector General, and two Assistant Deputies... D. The Treasury Inspector General must have access... E. Congress must be notified if the Secretary interferes... F. in addition to standard reporting requirements the Treasury Inspector General...
Section 4
Prohibition on Executive Branch Influence over Audits and Personnel Flexibilities
A. Prohibition on Executive Branch Influence Over Taxpayer Audits (House bill) B. IRS Personnel Flexibilities
Section 5
Electronic Filing
A. Include the House proposal providing that paperless filing should be preferred... B. Include the House provision extending from... C. Include the House provision requiring the Secretary of Treasury to develop... D. Include the House provision requiring the Secretary to develop procedures to implement a return free... E. Include the House provision which requires the Secretary to develop...
Section 6
Taxpayer Protections
A. Burden of Proof B. Proceedings by Taxpayers C. Relief for Innocent Spouses and Persons with Disabilities D. Provisions Relating to Interest and Penalties E. Protections for Taxpayers Subject to Audit or Collection F. Additional Taxpayer Protections Relating to Liens, Levies, and Seizures G. Disclosures to Taxpayers (House bill) H. Low Income Taxpayer Clinics (House bill) I. Other Matters
Section 7
Congressional Accountability
Require the IRS to provide an annual report on tax law complexity and simplification.
