Bill Summary
The "Internal Revenue Service Math and Taxpayer Help Act" aims to enhance communication between the IRS and taxpayers regarding notices of mathematical or clerical errors on tax returns. Key provisions include:
1. **Improved Notice Requirements**: The act mandates that IRS notices explaining errors must be clear and detailed, specifying the type of error, the relevant tax code section, and the exact line of the tax return affected. This aims to make it easier for taxpayers to understand the issues.
2. **Itemized Adjustments**: Notices must include a precise breakdown of any adjustments to the taxpayer’s return, covering various aspects such as income, deductions, credits, and taxes owed or refunded.
3. **Notice of Abatement**: When an abatement (cancellation of tax) is determined, the IRS is required to send a comprehensive notice to the taxpayer outlining the abatement details and any related adjustments.
4. **Implementation Timeline**: The changes will take effect 12 months after the enactment of the act, and the IRS must establish procedures for taxpayers to request abatements within 180 days of enactment.
5. **Pilot Program**: The act directs the IRS to initiate a pilot program within 18 months to test sending error notices via certified or registered mail, providing a framework to assess the effectiveness of this method in improving taxpayer response.
Overall, the legislation seeks to enhance transparency and assistance for taxpayers facing math or clerical errors on their tax returns.
Possible Impacts
Here are three examples of how the "Internal Revenue Service Math and Taxpayer Help Act" could affect people:
1. **Improved Understanding of Errors**: Taxpayers who receive notices regarding math or clerical errors will benefit from clearer and more comprehensive explanations of the specific errors on their tax returns. The requirement for notices to include detailed descriptions, such as the type of error and the exact line on the return where the error occurred, will help individuals understand what went wrong and how to correct it. This may reduce confusion and frustration for taxpayers who previously received vague notices.
2. **Increased Transparency in Adjustments**: The legislation mandates that notices include an itemized computation of any adjustments to be made due to the errors. This means taxpayers will have a clearer understanding of how their tax liability is affected, including changes to deductions, credits, and other tax-related figures. This transparency can help taxpayers make informed decisions about their finances and prepare more accurately for any adjustments in their tax obligations.
3. **Easier Access to Abatement Requests**: The Act includes provisions for taxpayers to request an abatement of assessments related to the identified errors. This can empower individuals by providing them with a straightforward process to contest or correct potential tax liabilities they believe are incorrect. The option to request abatement in multiple formats (writing, electronically, by telephone, or in person) enhances accessibility, making it easier for taxpayers to engage with the IRS and resolve issues related to their tax returns.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 998 Enrolled Bill (ENR)]
H.R.998
One Hundred Nineteenth Congress
of the
United States of America
AT THE FIRST SESSION
Begun and held at the City of Washington on Friday,
the third day of January, two thousand and twenty-five
An Act
To amend the Internal Revenue Code of 1986 to require additional
information on math and clerical error notices.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Internal Revenue Service Math and
Taxpayer Help Act''.
SEC. 2. IMPROVEMENT OF NOTICES OF MATH OR CLERICAL ERROR.
(a) In General.--Section 6213(b)(1) of the Internal Revenue Code of
1986 is amended--
(1) by striking ``errors.--If the taxpayer'' and inserting
``errors.--
``(A) In general.--If the taxpayer'',
(2) by striking ``Each notice'' in the second sentence and
inserting ``Subject to subparagraph (B), each notice'', and
(3) by adding at the end the following new subparagraph:
``(B) Specificity of math or clerical error notice.--
``(i) In general.--The notice provided under
subparagraph (A) shall--
``(I) be sent to the taxpayer's last known address,
``(II) describe the mathematical or clerical error
in comprehensive, plain language, including--
``(aa) the type of error,
``(bb) the section of this title to which the
error relates,
``(cc) a description of the nature of the
error, and
``(dd) the specific line of the return on which
the error was made,
``(III) an itemized computation of any direct or
incidental adjustments to be made to the return in
correction of the error, including any adjustment to
the amount of--
``(aa) adjusted gross income,
``(bb) taxable income,
``(cc) itemized or standard deductions,
``(dd) nonrefundable credits,
``(ee) credits under section 24, 25A, 32, 35,
or 36B, credits claimed with respect to
undistributed long-term capital gains on Form 2439,
credits for Federal taxes paid on fuels claimed on
Form 4136, and any other refundable credits,
``(ff) income tax,
``(gg) other taxes,
``(hh) total tax,
``(ii) Federal income tax withheld or excess
tax withheld under section 3101 or 3201(a),
``(jj) estimated tax payments, including amount
applied from prior year's return,
``(kk) refund or amount owed,
``(ll) net operating loss carryforwards, or
``(mm) credit carryforwards,
``(IV) include the telephone number for the
automated phone transcript service, and
``(V) display the date by which the taxpayer may
request to abate any assessment specified in such
notice pursuant to paragraph (2)(A), in bold, font size
14, and immediately next to the taxpayer's address on
page 1 of the notice.
``(ii) No lists of potential errors.--A notice which
provides multiple potential or alternative errors which may
be applicable to the return shall not be sufficiently
specific for purposes of clause (i)(II); however, if
multiple specific errors apply to the return all such
errors should be listed.''.
(b) Notice of Abatement.--Paragraph (2) of section 6213(b) is
amended by adding at the end the following new subparagraph:
``(C) Notice.--Upon determination of an abatement pursuant
to subparagraph (A), the Secretary shall send notice to the
taxpayer of such abatement which--
``(i) is sent to the taxpayer's last known address,
``(ii) describes the abatement in comprehensive, plain
language, and
``(iii) provides an itemized computation of any
adjustments to be made to the items described in the notice
of mathematical or clerical error, including any changes to
any item described in paragraph (1)(B)(i)(III).''.
(c) Effective Date.--The amendments made by this section shall
apply to notices sent after the date which is 12 months after the date
of the enactment of this Act.
(d) Procedures.--Not later than 180 days after the date of the
enactment of this Act, the Secretary of the Treasury (or such
Secretary's delegate) shall provide for procedures by which a taxpayer
may request an abatement referred to in section 6213(b)(1)(B)(i)(V) of
the Internal Revenue Code of 1986 in writing, electronically, by
telephone, or in person.
(e) Pilot Program.--Not later than 18 months after the date of the
enactment of this Act, the Secretary of the Treasury (or such
Secretary's delegate), in consultation with the National Taxpayer
Advocate, shall--
(1) implement a pilot program to send a trial number of
notices, in an amount which is a statistically significant portion
of all such notices, of mathematical or clerical error pursuant to
section 6213(b) of the Internal Revenue Code of 1986 by certified
or registered mail with e-signature confirmation of receipt, and
(2) report to Congress, aggregated by the type of error under
section 6213(g) of such Code to which the notices relate, on--
(A) the number of mathematical or clerical errors noticed
under the program and the dollar amounts involved,
(B) the number of abatements of tax and the dollar amounts
of such abatements, and
(C) the effect of such pilot program on taxpayer response
and adjustments or abatements to tax,
with conclusions drawn about the effectiveness of certified or
registered mail, with and without return receipt, and any other
recommendations for improving taxpayer response rates.
Speaker of the House of Representatives.
Vice President of the United States and
President of the Senate.