H.R.517 - Filing Relief for Natural Disasters Act (119th Congress)
Summary
H.R. 517, the Filing Relief for Natural Disasters Act, aims to amend the Internal Revenue Code of 1986 to modify and expand the rules for postponing certain tax deadlines in the event of a disaster. The bill allows the Secretary of the Treasury to postpone federal tax deadlines upon the written request of a state governor (or the Mayor of D.C.) for state-declared disasters. It also extends mandatory extensions for certain deadlines from 60 to 120 days.
This expansion includes natural catastrophes such as hurricanes, tornadoes, earthquakes, and other severe events. The changes apply to declarations made after the enactment of the Act.
In essence, the bill seeks to provide more flexibility and extended relief to taxpayers affected by natural disasters, streamlining the process for obtaining tax deadline extensions.
Expected Effects
The primary effect of H.R. 517 is to provide more comprehensive and extended tax relief to individuals and businesses impacted by natural disasters. By allowing state governors to request federal tax deadline postponements, the bill decentralizes some of the decision-making and potentially speeds up the relief process.
Additionally, the extension of mandatory deadlines to 120 days provides taxpayers with more time to recover and comply with their tax obligations. This could reduce penalties and interest for those struggling to meet deadlines due to disaster-related disruptions.
Overall, the bill is expected to ease the financial burden on those affected by disasters and provide a more responsive and flexible system for tax relief.
Potential Benefits
- Increased Flexibility: Allows state governors to request tax deadline postponements, making the process more responsive to local needs.
- Extended Relief: Extends mandatory extension periods from 60 to 120 days, providing taxpayers with more time to recover.
- Reduced Penalties: Potentially reduces penalties and interest for taxpayers struggling to meet deadlines due to disasters.
- Broader Coverage: Includes a wider range of natural disasters, ensuring more affected individuals and businesses can benefit.
- Streamlined Process: Simplifies the process for obtaining tax relief in disaster situations.
Potential Disadvantages
- Potential for Abuse: The delegation of authority to state governors could potentially lead to inconsistent application of the rules or even abuse.
- Increased Complexity: Adding a new subsection to Section 7508A of the Internal Revenue Code could add complexity to tax law.
- Unintended Consequences: The extended deadlines could have unintended consequences for government revenue collection and budget planning.
- Administrative Burden: The IRS may face an increased administrative burden in processing extension requests and managing the extended deadlines.
- Delayed Revenue: The delay in tax revenue collection could impact government operations in the short term.
Constitutional Alignment
The bill appears to align with the general welfare clause of the Constitution, as it aims to provide relief to citizens affected by natural disasters. While the Constitution does not explicitly address tax deadline extensions in disaster situations, Article I, Section 8 grants Congress the power to lay and collect taxes, duties, imposts, and excises, implying the power to modify tax laws and procedures.
The delegation of authority to state governors could raise concerns about federalism, but it is within the power of Congress to set the terms and conditions for such delegation. The bill does not appear to infringe on any specific constitutional rights or liberties.
Overall, the bill seems to operate within the bounds of constitutional authority, as it is related to the power to tax and provide for the general welfare.
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).