Taxpayer Due Process Enhancement Act
Summary
The Taxpayer Due Process Enhancement Act aims to amend the Internal Revenue Code of 1986 to provide additional protections for taxpayers during collection action proceedings. It suspends the period of limitations on filing a claim for credit or refund during collection action proceedings, prevents the IRS from crediting overpayments against disputed tax liability during such proceedings, and expands the jurisdiction of the Tax Court.
The Act seeks to ensure taxpayers have sufficient time to file claims and dispute tax liabilities without the risk of losing their right to do so due to time constraints. It also clarifies the application of certain levy hearing rules to lien hearings.
By expanding the Tax Court's jurisdiction, the Act provides taxpayers with a more accessible avenue for resolving disputes with the IRS.
Expected Effects
The Act will likely result in increased taxpayer protections and a more equitable process for resolving tax disputes. Taxpayers will have more time to file claims and will be shielded from having overpayments applied to disputed liabilities during collection proceedings. The expanded jurisdiction of the Tax Court will provide taxpayers with an additional forum to resolve disputes.
Potential Benefits
- Provides taxpayers with more time to file claims for credit or refund during collection action proceedings.
- Prevents the IRS from using overpayments to offset disputed tax liabilities during collection action proceedings, ensuring taxpayers retain control over their funds.
- Expands the jurisdiction of the Tax Court, giving taxpayers an additional avenue for resolving disputes with the IRS.
- Clarifies the application of levy hearing rules to lien hearings, ensuring consistent procedures.
- Promotes fairness and transparency in tax collection processes.
Potential Disadvantages
- May increase administrative burden on the IRS due to expanded taxpayer rights and procedural requirements.
- Could potentially delay the collection of tax revenue due to extended timelines for resolving disputes.
- The expanded jurisdiction of the Tax Court may lead to an increase in the number of cases filed, potentially straining the court's resources.
- Taxpayers may exploit the extended timelines to delay tax payments.
- Some taxpayers may find the legal processes complex and still require professional assistance.
Constitutional Alignment
The Act aligns with the principles of due process as outlined in the Fifth Amendment, which guarantees that no person shall be deprived of property without due process of law. By providing additional protections for taxpayers during collection action proceedings, the Act reinforces these constitutional protections. The expansion of Tax Court jurisdiction also aligns with Article I, Section 8, which grants Congress the power to lay and collect taxes, as it provides a mechanism for resolving disputes related to taxation.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).