Possible path forward emerges on IRS reform

Tax Hot Topics newsletter Congress may be inching toward an agreement on an IRS reform and tax administration bill.

The Taxpayer First Act (H.R. 1957) has been held up in the Senate over concerns about a provision that would codify the Free File program. Senate Finance Committee Chair Chuck Grassley (R-Iowa) has now stated staff are working on ways to address those concerns. Ranking minority member Ron Wyden (D-Ore.) went further, suggesting he would be amenable to stripping the provision from the bill entirely.

The bill was expected to advance swiftly with broad bipartisan support. Leaders in the House of Representatives and Senate initially had a “four corners” agreement in place to secure its passage. It was approved by the House of Representatives by unanimous voice vote on April 9 and was to be fast-tracked by the Senate without amendment. The expedited “hotline” process, which requires unanimous consent, was halted after several Democrats, including some running for president, opposed codifying Free File. For more details, see our prior coverage.

The top tax writers in the House have indicated they would be willing to consider changes to the provision, setting up the possibility that the Senate will send an amended version of the bill back to the House for approval. However, removal of the provision may complicate that. Leaders from both chambers will likely need to secure unanimous support for an amended bill in order to secure speedy passage and prevent it from being mired by further controversy.

Dustin Stamper
Managing Director
Washington National Tax Office
T +1 202 861 4144

Omair Taher
Senior Associate
Washington National Tax Office
T +1 202 861 4143

Tax professional standards statement
This content supports Grant Thornton LLP’s marketing of professional services and is not written tax advice directed at the particular facts and circumstances of any person. If you are interested in the topics presented herein, we encourage you to contact us or an independent tax professional to discuss their potential application to your particular situation. Nothing herein shall be construed as imposing a limitation on any person from disclosing the tax treatment or tax structure of any matter addressed herein. To the extent this content may be considered to contain written tax advice, any written advice contained in, forwarded with or attached to this content is not intended by Grant Thornton LLP to be used, and cannot be used, by any person for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.

The information contained herein is general in nature and is based on authorities that are subject to change. It is not, and should not be construed as, accounting, legal or tax advice provided by Grant Thornton LLP to the reader. This material may not be applicable to, or suitable for, the reader’s specific circumstances or needs and may require consideration of tax and nontax factors not described herein. Contact Grant Thornton LLP or other tax professionals prior to taking any action based upon this information. Changes in tax laws or other factors could affect, on a prospective or retroactive basis, the information contained herein; Grant Thornton LLP assumes no obligation to inform the reader of any such changes. All references to “Section,” “Sec.,” or “§” refer to the Internal Revenue Code of 1986, as amended.