WASHINGTON, D.C. — With April 15 a week away, Representative Xavier Becerra (CA-31), Assistant to the Speaker of the House and the only congressional member from Southern California on the Ways and Means Committee, introduced today the Taxpayer Bill of Rights Act of 2008.
“Tax season can be a daunting time for working families who are unfamiliar with our nation’s complicated tax code – and sadly there are unscrupulous individuals willing to take advantage of hardworking taxpayers,” Rep. Becerra said after introducing the bill. “This simple, common sense legislation would clarify the rights and responsibilities of all taxpayers in a single document, while improving taxpayer services and providing better regulation and oversight of tax preparers.”
Rep. Becerra’s bill would clarify the rights and responsibilities of taxpayers by requiring the Treasury Department to publish in the tax code an easy-to-understand Taxpayer Bill of Rights. This publication would state each right and obligation and list its corresponding location in the tax code. This provision creates no new rights or obligations within the tax code itself, but simply seeks to clarify what Americans should expect from their government and its 5,000-page tax code.
The Taxpayer Bill of Rights Act protects filers against being exploited by untrained and unscrupulous individuals by regulating for-profit tax return preparers. In order to become registered and authorized by the Treasury Department a tax preparer would first need to pass a basic background check and an examination of competency and knowledge of ethics. To remain in good standing, they would need to satisfy continuing education requirements or be re-examined every three years on changes in tax law and common preparation mistakes. The federal government does not currently regulate these entities and individuals.
The legislation provides further protections to taxpayers by establishing a registration program for all entities involved in facilitating refund anticipation loans (RALs), and outlines information that must be disclosed in writing to a taxpayer applying for one of these often-high interest loans.
Rep. Becerra’s bill improves and expands services to low and moderate income taxpayers by providing a $10 million grant for the IRS’s volunteer income tax assistance (VITA) program. It also enhances taxpayer access to financial institutions by establishing a grant program to provide low- or no-cost bank accounts to individuals who currently do not have one. By allowing taxpayers to receive their refund and stimulus payments through direct deposit, these new accounts would enable quicker access to these funds and avoid the need for high interest RALs.
The bill would also express the sense of Congress that the IRS must reduce the time between receipt of a tax return and remitting a refund, and provide greater filing assistance and resources to low and moderate income taxpayers.
“It is high time that we equip the American taxpayer with easy access to the knowledge and resources they need to successfully weather tax season and secure the refund they deserve – this simple, comprehensive bill of rights does just that,” Rep. Becerra said.
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