It exists. Ladies and gentleman, whether you want to believe it or not, there is an IRS Taxpayer Bill of Rights. I am completely, 100%, not messing with you. Pulled straight from the trenches of IRS.gov, here it is.
Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS:
- The Right to Be Informed
- The Right to Quality Service
- The Right to Pay No More than the Correct Amount of Tax
- The Right to Challenge the IRS’s Position and Be Heard
- The Right to Appeal an IRS Decision in an Independent Forum
- The Right to Finality
- The Right to Privacy
- The Right to Confidentiality
- The Right to Retain Representation
- The Right to a Fair and Just Tax System
As I look at the above list and reflect upon my many years of practicing law, I can honestly say the following about the Taxpayer Bill of Rights: It's definitely a thing on a website, but just because something is put on the internet doesn't mean that it's true.
I don't think that truth could be any more apparent than it is when we take a look at the IRS's Taxpayer Bill of Rights.The issue is that there are countless violations of the Taxpayer Bill of Rights every single day. From hold times extending over two hours (complete with "courtesy disconnects" that require you to call back and try again) to the threat of being assessed FBAR penalties that could exceed your entire net worth, the taxpayer Bill of Rights clearly has no power.
Even though it's there for the entire world to see, it is a rather unenforceable promise. Honestly, it's nothing more than window dressing. The Taxpayer Bills of Rights doesn't hold the IRS to any treatment of US taxpayers, so it is more of an insult than anything worthwhile.
In an interesting turn of events, there is a proposal in the Senate from Sen. Chuck Grassley of Iowa and Sen. John Thune of South Dakota to create a new taxpayer Bill of Rights. According to Sen. Grassley's press release:
"The bill is necessary to ensure that appropriate safeguards are in place to protect taxpayer rights by preventing IRS abuses, Grassley and Thune said. Among other provisions, the legislation:
- Significantly increases civil damages and criminal penalties for the unauthorized disclosure or inspection of tax return information and significantly increases civil damages for improper IRS collection activities.
- Imposes an affirmative duty on the commissioner of the IRS to ensure that IRS employees are familiar with and act in accordance with all taxpayer protections.
- Updates the “10 deadly sins” established by the IRS Restructuring and Reform Act of 1998, those actions by IRS employees that require mandatory termination, to include official actions taken for political purposes.
- Permits the Treasury Department to provide status updates, and in certain instances require status updates, regarding investigations into misconduct by IRS employees — or in some circumstances third parties – to taxpayers who are the subject of the misconduct.
- Puts the bite back into a provision, recently called a “toothless tiger” by Tax Notes, that permits taxpayers to bring a cause of action against the IRS for unauthorized collections actions.
- Extends the declaratory judgment remedy currently available to 501(c)3 to other 501(c) groups, including 501(c)(4) social welfare organizations, in instances where the IRS fails to act on an application in a timely manner or makes a negative determination as to their tax-exempt status.
- Prohibits IRS officers and employees from using personal email accounts to conduct official business.
- Provides additional authority concerning the use of taxpayer information to the IRS for the purpose of locating taxpayers due a tax refund.
- Requires tax-exempt organizations to file Form 990 electronically and mandates that the IRS make such information available in a timely manner.
- Imposes new requirements on the IRS with respect to email retention consistent with the existing directive from the Office of Management and Budget and the National Archives."
I have three problems with this development. My first and biggest problem with the proposed Taxpayer Bill of Rights Act of 2015 is that is it needed. In horrifying fashion, everything that is being suggested are safeguards for the American people that should have always been in place.
Second, and somewhat conversely, if it managed to ever become law, the fact is that many punishments are still paid for by other taxpayers. That is, if the IRS does something wrong, more often than not it will be taxpayers paying for the damages.
Third, I know how rules actually get dispersed in a massive bureaucracy like the IRS. Typically, bad employees know exactly how to "CYA," and work in collusion to frustrate oversight. I've seen great IRS employees get hammered and then some of the less-qualified (and perhaps truly awful) get promoted. Will another Taxpayer Bill of Rights really help or just cause more of the same issues?
You can either have a limited government or a tax on personal income: Pick one
The task given to the IRS — invading and inspecting everyone's personal and commercial affairs — is too large to be administered fairly. The task is inherently unfair; regardless of your beliefs in federal programs, the IRS takes people's money simply by virtue of a taxpayer gaining possession of it in any given year.
While I would support this Taxpayer Bill of Rights Act of 2015, I know it will actually accomplish little in protecting taxpayers from a government intent on steamrolling its own people. Why? Because the job of the IRS is nothing other than to steamroll people and extract money from them.
