"While most taxpayers willingly pay their share as required by law, many nonetheless feel frustrated or even intimidated by treatment from the IRS. As an IRS watchdog, I have worked for years to empower taxpayers in dealing with the federal tax collecting agency. These new, pro-taxpayer measures will dramatically alter the way in which the IRS conducts its business by giving taxpayers the respect and fairness they deserve," said Grassley.
The Taxpayer Bill of Rights III, or T3, is a continuation of Grassley's earlier efforts to protect the rights of honest taxpayers. Grassley said his bill will take a two-pronged approach.
The first portion of the bill would expand current taxpayer rights and add new protections safeguarding against IRS abuse. Among its provisions, T3 would require the IRS to obtain court approval before taxpayer property or belongings are seized. Current law allows the IRS to seize property without court approval. Furthermore, the IRS must demonstrate to the judge that the seizure of property from the delinquent taxpayer is reasonable and that, in the case of a principal residence or business, all other payment options have been exhausted.
The second half of T3 deals with taxpayer education. Grassley's bill would require the IRS to clearly define the rights and appeals procedures to taxpayers who receive delinquency letters.
"In order for taxpayers to take full advantage of their rights, they must first be aware of them," said Grassley. "Recent hearings have exposed IRS strategies which target the little guy by using his lack of knowledge about the process against him. I intend to bring this unjust practice to an end."
In 1989, Grassley co-authored the first-ever taxpayer bill of rights with former Sen. David Pryor of Arkansas. The two senators joined forces again to win passage in 1996 of a sequel known as the Taxpayer Bill of Rights II, or T2. Grassley's work for taxpayers continued through his appointment to the National Commission on Restructuring the IRS. The commission conducted a year-long review of the tax collecting agency and announced its recommendations last June. Grassley took those recommendations and joined with Sen. Bob Kerrey of Nebraska to introduce comprehensive bipartisan legislation last July to restore the proper balance between the tax collector and the taxpayer.
"Americans agree that tax season puts a lot of pressure on tax preparers and individual taxpayers. Much of that can be attributed to their frustration when dealing with the IRS," said Grassley. "This bill sends a clear signal: put the customer first. I'll continue working to make sure the IRS gets the message."
As a senior member of the Senate Finance Committee, Grassley has played a leading role in the debate to restructure the IRS. A summary of the Grassley legislation follows.