Rep. John Lewis Urges Appropriators to Amend Free File Policy Rider
Rep. John Lewis recently joined congressional colleagues in urging the Appropriations Committee to rescind a policy rider that would prevent the Internal Revenue Service (IRS) from amending the Free File program. Most of the attention in the press regarding H.R. 1957, the Taxpayer First Act, relates to the Free File program and allegations that the Taxpayer First bill disables the IRS from creating an automatic filing system of its own.
As one of the chief authors of the bill and chair of the Ways and Means Oversight Subcommittee, Rep. Lewis felt it was important to clarify the record. The Taxpayer First Act is a rare, bi-cameral, bi-partisan effort to respond to taxpayer needs in a divisive period in congressional history. Careful checking of the facts reveals that the Taxpayer First Act does not in fact block the IRS’s ability to create a free filing system of its own. The IRS Chief Counsel verified that view of the law, as was revealed during a Senate Finance Committee hearing on April 10th of this year.
Many provisions respond to key constituent concerns and recommendations from the National Taxpayer Advocate and Treasury Inspector General for Tax Administration. In addition to public hearings and roundtables, the Subcommittee also strove to be transparent and bipartisan by releasing a discussion draft and opening a public comment period. The Taxpayer First Act begins the process of provided desperately needed support, authority, and guidance for the IRS to improve taxpayer services. If this bill does not pass become public law, the Free File program will continue, but the protections it offers against private debt collectors and taxpayer security safeguards will not be implemented.
Recently, House staff conducted research to certify that authorizing the Free File program would not prevent the IRS from creating its own similar program. Although they reconfirmed that the Taxpayer First Act preserves the option of the IRS to amend or terminate the Free File program, they discovered that the annual Financial Services and General Government Appropriations bill did include a policy rider that prevented this option.
As Ways and Means Oversight Subcommittee Chairman, Rep. Lewis worked with Members, who shared his concern about the necessity of providing IRS with the tools and flexibility it needed in the Taxpayer First Act and in future initiatives to assist taxpayers. Upon discovery of this language, several members joined Rep. Lewis in requesting that the Appropriations Committee strike this restrictive language from the bill as they begin the daunting challenge of negotiating a path to fund the federal government.
Dear Chairman Quigley and Ranking Member Graves:
We respectfully write to request that the fiscal year 2020 (FY20) Financial Services and General Government Appropriations bill and accompanying report exclude any language that would prohibit the Internal Revenue Service (IRS) from creating pre-filled forms or software.
As you know, recent appropriations laws included bill language that restricted the discretion and authority of the Secretary of the Treasury and the IRS to address this matter. For these reasons, we respectfully oppose the inclusion of any provision that is similar in intent or impact to what was included in Division D, Title I, Section 111 of Public Law (Pub. L.) 116-6 or in Pub. L.115-141, Division E, Title I, Section 112.
We believe that this language prevents the IRS from reviewing, managing, and developing diverse options to assist taxpayers. In particular, we believe that this provision conflicts with and undermines the intention of H.R. 1957, the Taxpayer First Act, which recently passed the House by voice vote. The Taxpayer First Act is the result of many public hearings and roundtables to modernize this long-overlooked agency. This negotiated, bipartisan, bicameral compromise provides desperately needed guidance and authority for the IRS, with a particular focus on low-income taxpayers and working families.
Unfortunately, this appropriations language undercuts the intent of the Taxpayer First Act authors to retain and bolster options to simplify the taxpayer experience. H.R. 1957 strives to ensure that the IRS has the flexibility to develop and explore alternative taxpayer preparation and service programs that respond to current needs and challenges.
We believe that any appropriations policy rider would undermine the spirit and purpose of this bipartisan and long-overdue legislation. For example, the Taxpayer First Act authorizes the Volunteer Income Tax Assistance and Free File program as options for taxpayers seeking assistance. The IRS chief counsel recently reconfirmed that the agency may suspend the Free File program with 12-months advance notice; however, restrictive appropriations language would prevent the IRS from using its discretion to respond to current needs and taxpayers’ preferences.
The IRS must be able to respond to existing priorities and emerging threats. Similar to many of our colleagues, we remain alarmed about the steady decline in taxpayer service that stems from IRS budget cuts, retirements of experienced employees, and a lack of quality training. Continued budget and staffing cuts result in taxpayers experiencing longer telephone wait times and decreased levels of service when they attempt to secure assistance and guidance from the IRS. While the Taxpayer First Act is a critical component to addressing many long-standing challenges in taxpayer service, restoring federal funding for the IRS is a critical component of improving the taxpayer experience.
Increased and sustained funding will help the IRS implement the Taxpayer First Act’s comprehensive customer service strategy, expansion of the Volunteer Income Tax Assistance program, improved cybersecurity, and protection from identity and refund theft and fraud. It is critical that the appropriations bill provide adequate support for these programs and Tax Counseling for the Elderly (TCE), Low-Income Taxpayer Clinics (LITC), and the Taxpayer Advocate Service.
In addition, we respectfully reiterate our request that the FY20 bill refrain from encouraging or supporting the troubling private collection agencies (PCAs) program. The Taxpayer First Act severely limits the scope of the program in which the National Taxpayer Advocate and Treasury Inspector General for Tax Administration found disturbing patterns of harassment and abuse of low-income taxpayers. We hope that the appropriators will not encourage an expansion of this problematic initiative.
Finally, we hope that the Committee will be mindful of House Rule XXI that prohibits revenue and tax administration provisions in appropriations bills. We remain strongly opposed to any appropriations legislation that includes provisions “affecting” tax administration without any Congressional review or public discussion.
As always, we thank you for considering our views and for your hard work and leadership on the annual Financial Services and General Government Appropriations bill.
Katie Hill, Member of Congress
Alexandria Ocasio-Cortez, Member of Congress
John Lewis, Member of Congress
Chris Pappas, Member of Congress
Thomas R. Suozzi, Member of Congress
Brendan F. Boyle, Member of Congress
Mike Levin, Member of Congress
Judy Chu, Member of Congress
Linda T. Sánchez, Member of Congress
Gwen Moore, Member of Congress
Peter A. DeFazio, Member of Congress