Johnson Announces Hearing to
Explore the Development of
Taxpayer Bill of Rights II Legislation

Congresswoman Nancy L. Johnson (R-CT), Chairman of the Subcommittee on Oversight of the Committee on Ways and Means, today announced that the Subcommittee will conduct a hearing to explore the development of Taxpayer Bill of Rights II legislation during the 104th Congress. The hearing will be held on Friday, March 24, 1995, in the main Committee hearing room, 1100 Longworth House Office Building, beginning at 9:00 a.m.

This hearing will feature invited witnesses only. In view of the limited time available to hear witnesses, the Subcommittee will not be able to accommodate requests to testify other than from those who are invited. Those persons and organizations not scheduled for an oral appearance are welcome to submit written statements for the record of the hearing.

BACKGROUND:

The term "Taxpayer Bill of Rights" refers to legislation that combines numerous individual provisions to strengthen the rights of taxpayers in their dealings with the internal Revenue Service (IRS). The original Taxpayer Bill of Rights (TBR) became law in 1988. It sought to create a more level playing field between taxpayers and the IRS by creating over one dozen procedural safeguards for taxpayers. For example, it gave taxpayers a legal right to sue the IRS for up to $100,000 in damages in order to redress reckless actions taken by IRS agents in collecting taxes. It gave taxpayers in financial difficulty the statutory right to pursue installment payments plans with the IRS. It also prohibited the IRS from evaluating collection agents based on their collection results and from imposing collection quotas on its agents. Finally, it gave taxpayers who prevail over the IRS in litigation the right to have the IRS reimburse part of their attorney fees in some circumstances.

The 1988 legislation was a step in the right direction, but the general consensus was that much more could be done to help taxpayers. The Oversight subcommittee held two days of hearings in 1991 to explore legislation to build on the 1988 TBR and further improve taxpayer safeguards and rights in dealing with the IRS. This hearing activity led the Subcommittee to conclude that it would be desirable to pursue a Taxpayer Bill of Rights II (TBR2). The Subcommittee Members developed H.R 3838 as legislation to create the taxpayer safeguards that they had identified as being helpful to taxpayers. H.R 3838 was introduced in November, 1991. A modified version of H.R. 3838 was included in H.R. 11, the Revenue Act of 1992, which passed Congress in October 1992, but was vetoed by President Bush for reasons unrelated to the TBR2 provisions.

TBR2 provisions in H.R. 11 contained over two dozen provisions to help taxpayers. For example, one provision would have expanded the power of the Taxpayer Ombudsman in the IRS to issue protective orders to help taxpayers who were being treated unfairly by the application of normal IRS procedures. It would have imposed on the IRS an obligation to take reasonable steps to corroborate information returns whose accuracy is disputed by the taxpayer It would have given the IRS the authority to waive the interest on late tax payments in cases where the taxpayer had a good reason for the late payment (Under current law, the IRS has broad authority to waive penalties but not the interest on late tax payments.) It also would have required the IRS to give that taxpayer 30 days advance notice before it revoked an installment payment agreement that it previously had entered into with a taxpayer.

The need for a Taxpayer Bill of Rights II has not diminished since 1992. Taxpayers would benefit if their rights were strengthened in dealing with the IRS. A good starting point in exploring expansions of the Taxpayer Bill of Rights in the 104th Congress would be the provisions that passed Congress in 1992 as part of H.R. 11. In addition, other legislation has been introduced in the 104th Congress, which builds on the earlier TBR.

In announcing the hearing, Chairman Johnson said: "When the average taxpayer goes up against the IRS, it's like a contest between David and Goliath. We should investigate ways to safeguard the rights of taxpayers in these contests. Taxpayers have a duty to pay their lawful tax liability, but they should not be put at a disadvantage by procedural rules and IRS policies that make the David and Goliath contest any more one-sided than it often is."

DETAILS FOR SUBMISSION OF WRITTEN COMMENTS:

Any person or organization wishing to submit a written statement for the printed record of the hearing should submit at least six (6) copies of their statement by the close of business, Monday, April 3, 1995 to Phillip D. Moseley, Chief of Staff, Committee on Ways and Means, U.S. House of Representatives, 1102 Longworth House Office Building, Washington, D.C. 20515. If those filing written statements wish to have their statements distributed to the press and interested public at the hearing, they may deliver 200 additional copies for this purpose to the Subcommittee on Oversight office, room 1136 Longworth House Office Building, at least one hour before the hearing begins.

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