H.R.196 - Family and Small Business Taxpayer Protection Act (119th Congress)
Summary
H.R. 196, the Family and Small Business Taxpayer Protection Act, aims to rescind certain unobligated balances allocated to the Internal Revenue Service (IRS) through the Inflation Reduction Act of 2022. Specifically, it targets funds appropriated for IRS activities as outlined in section 10301, paragraphs (1)(A)(ii), (1)(A)(iii), (1)(B), (2), (3), (4), and (5) of Public Law 117-169. The bill was introduced in the House of Representatives on January 3, 2025, and referred to the Committee on Ways and Means.
Expected Effects
If enacted, H.R. 196 would reduce the financial resources available to the IRS. This could lead to decreased enforcement of tax laws and potentially impact the agency's ability to modernize its systems and improve taxpayer services. The rescission of funds could also affect the IRS's capacity to implement provisions of the Inflation Reduction Act related to tax administration.
Potential Benefits
- Potential reduction in government spending, aligning with fiscal conservatism.
- Could lead to reduced regulatory burden on small businesses and families if the IRS has fewer resources for audits and enforcement.
- May decrease concerns about potential overreach or misuse of power by the IRS due to reduced funding.
- Could spur a debate on the appropriate level of funding for tax enforcement and administration.
- Might encourage the IRS to operate more efficiently with fewer resources.
Potential Disadvantages
- Reduced IRS funding could lead to decreased tax revenue collection due to less enforcement.
- May hinder the IRS's ability to modernize its technology and improve taxpayer services.
- Could disproportionately benefit wealthy individuals and corporations who are better able to avoid taxes.
- May increase the tax burden on ordinary citizens if the IRS is less effective at collecting taxes from those who evade them.
- Could undermine the integrity of the tax system if tax evasion becomes more prevalent.
Most Disadvantaged Areas:
Constitutional Alignment
The bill's focus on rescinding appropriations falls under Congress's power of the purse, as outlined in Article I, Section 9, Clause 7 of the US Constitution, which states that "No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law." The bill does not appear to infringe upon any specific constitutional rights or protections. However, the potential impact on the IRS's ability to enforce tax laws could indirectly affect the government's ability to fulfill its constitutional obligations, such as providing for the common defense and general welfare, as mentioned in the Preamble.
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).