January 30,2025

Crapo, Wyden Issue Discussion Draft to Improve IRS Administration

Legislation would implement fixes to improve the taxpayer experience

Washington D.C.— U.S. Senate Finance Committee Chairman Mike Crapo (R-Idaho) and Ranking Member Ron Wyden (D-Oregon) released a discussion draft of bipartisan legislation making an array of common-sense fixes to Internal Revenue Service (IRS) procedure and administration. 

“As the tax filing season gets underway, this draft legislation suggests practical ways to improve the taxpayer experience,” Crapo and Wyden said. “These adjustments to the laws governing IRS procedure are designed to facilitate communication between the agency and taxpayers, streamline processes for tax compliance and disputes and ensure taxpayers have access to timely expert assistance.”    

"This bipartisan draft bill, several years in the making, would significantly strengthen taxpayer rights in nearly every facet of tax administration,” said Erin Collins, the National Taxpayer Advocate.  “I encourage taxpayers and the tax professional community to carefully review the draft and provide feedback to refine it, and I encourage Congress to prioritize the passage of this common sense bill to ensure stronger protections for taxpayers and a more fair and transparent tax system."

The discussion draft includes policies that would:

  • Require the IRS to improve “math error” notices so that taxpayers are better positioned to timely respond to them;
  • Streamline review of offers-in-compromise to facilitate the taxpayers’ resolution of tax debts;
  • Simplify foreign bank account report (FBAR) compliance so that fewer taxpayers will fail to file key forms;
  • Clarify and expand Tax Court jurisdiction so that more taxpayers can pursue their claims in an appropriate venue;
  • Expand the independence of the National Taxpayer Advocate (NTA) from the IRS;
  • Increase civil and criminal penalties on tax professionals that deliberately take actions to harm their clients;
  • Expand taxpayer access to the IRS Independent Office of Appeals;
  • Extend the so-called “mailbox rule” to electronic submissions so that taxpayers have certainty their materials are submitted on time;
  • Protect taxpayers by adopting reasonable standards and due process for issuing and revoking return preparer identification numbers (PTINs);
  • Strengthen the IRS whistleblower program while protecting the confidentiality of taxpayer information;
  • Protect hostages from unfair tax processes and penalties.

Proposals in the discussion draft largely reflect nonpartisan legislative proposals recommended by the National Taxpayer Advocate, as well as standalone tax administrative bills introduced by congressional members.  The provisions are centered on seeking to reduce or eliminate challenges faced by taxpayers and other stakeholders within the current federal tax administrative system. 

The text of the discussion draft is available here.

A section-by-section of the legislation is available here.

Comments on this discussion draft are requested by March 31, 2025, and can be sent to discussiondraft@finance.senate.gov.