The House Ways and Means Committee recently passed the Retirement, Savings, and Other Tax Relief Act of 2018 through the House. Within this legislation is a bill called Taxpayers First Act of 2018, which was devised to protect taxpayers from unfair practices as well as reform the IRS.

There is bipartisan support for improving the IRS, so if the bill gets passed by the Senate, we could be seeing a more taxpayer-friendly IRS in the next few years. In fact, the IRS commissioner would be required to submit a plan for improved customer service within a year and a full plan to completely overhaul the agency by September of 2020. Changes would include, but not be limited to, the following:

Independent Appeals Process

In order to cut back on deduction disputes landing in court, this proposal requires the IRS to make available an independent appeals process to all taxpayers with a legitimate claim. Though the IRS already has a process for review, the law as it is now doesn’t guarantee access to it.

Customer Service Improvements

The agency would adopt private sector best practices of customer-service providers, which would mean updating guidance and training materials for IRS customer-service employees. It would also provide taxpayers with more secure and varied means of communication, such as online and telephone call back services.

Easier Settlement Procedures

According to the existing Offer-in-Compromise (CIO) program, the IRS may let you settle your tax debt for less than the full amount you owe, but up-front payments and application fees usually apply. Under the new bill, OIC fees would be waived for certain low-income taxpayers.

Property Seizure Limitations

Though the new bill would still allow the IRS to pursue the seizure or forfeiture of assets, it would only be allowed to do so if the property to be seized was derived from an illegal source or the transactions were structured for the purpose of concealing criminal activity. It also includes new post-seizure procedures to protect taxpayers who had property taken by the IRS for violating the reporting rules. And if a taxpayer has property returned after a hearing, any interest that comes along with it would be tax-free.

Cybersecurity

The IRS would institute a collaborative effort with the private sector to enhance cybersecurity and protect taxpayers from identity theft refund fraud. Along with implementing an information sharing and analysis center, the initiative would include appointing an IRS Chief Information Officer.

Electronic Services

The bill includes significant technology upgrades to the IRS and its structure, including online portals where taxpayers and their representatives can access taxpayer information, make payments, and share documentation. Taxpayers would also have the ability to prepare and file Forms 1099.