(11/22/97 Baltimore AFRO-American Newspaper)
by Congressman Elijah E. Cummings
As I was recently leaving Harbor Bank, a young man named Carlton approached me. I knew that he owned a thriving construction business, and when I asked him how his company was doing he lowered his head and explained to me that a few weeks ago he had lost his business because of past due taxes. He said that he had attempted to work with the IRS to pay the substantial taxes, interest and penalties, but because of a slow cash flow, he was unable to keep up with the payment schedule. He also said that he never asked the IRS to reduce the interest and penalties because he wanted to pay what he owed. He simply asked for time to do so. Unfortunately, his trucks and equipment were eventually seized and sold by the IRS to satisfy a part of the debt. He also had to dismiss his thirteen (13) employees. Since coming to Congress, my offices have encountered hundreds of constituents with similar stories.
On November 5, 1997, I joined my colleagues in the United States House of Representatives in overwhelmingly passing a common sense reform of the Internal Revenue Service (IRS). The measure, The Internal Revenue Service Restructuring and Reform Act of 1997 (H.R. 2676), passed the House by a vote of 426-4. The wide margin by which this bill passed indicates among other things that the American people are tired of business as usual at the IRS.
All of us pay taxes. Some of us pay more than others. Many of us share a paralyzing fear that we have made a mistake when we file our tax return by the April deadline. We have all heard the horror stories of the dreaded audit or the mistake made by the IRS and the years it took to fix it.
The Tax Code has become burdensome and hard to understand. This year alone, Congress added 600 pages to the Code by passing $85 billion in tax cuts. When a tax cut makes the Tax Code more complex, you know it is time to scrap this Code and start over with one that is simple, fair, and understandable.
At the end of September, three days of emotional testimony before the Senate Finance Committee about abuses by the IRS culminated in a public apology from acting IRS Commissioner Michael P. Dolan. One of the citizens, Monsignor Lawrence Ballweg, of New York, said he lost sleep for eight months after the IRS insisted he owed $18,000 on his late mother’s charitable trust, but the IRS refused to give him a copy of the tax return. It turned out he had simply filed the wrong form. Even IRS revenue agent Jennifer Long testified that "egregious tactics" are used with the support of supervisors "to extract unfairly assessed taxes from taxpayers, literally ruining families, lives and businesses - all unnecessarily and sometimes illegally."
This hearing produced a torrent of negative public comments and publicity about the IRS. Furthermore, a 1996 Congressional Act established a 17-member congressional commission to study the operations of the IRS - the first such commission since 1952. The commission found the IRS fraught with abuse and mismanagement and recommended that the management of the IRS be placed in the hands of an independent board.
H.R. 2676 was drafted by House Ways and Means Committee Chairman Bill Archer of Texas
(Congressman Ben Cardin introduced the underlying bill, which was modified slightly by Representative Archer). The bill establishes an oversight board for the IRS, with eight of its eleven members being private sector professionals, to oversee the agency’s management. The oversight board should bring private sector expertise to the IRS, streamline procedures, ease citizen interaction, and improve efficiency. The measure also shifts the burden of proof from the taxpayer to the IRS in cases before the U.S. Tax Court (about 1,500 cases are tried before the Tax Court each year). It also makes it a felony for executive branch officials to use IRS audits for political purposes; allows taxpayers to sue the government for damages if IRS personnel negligently disregard tax law (a taxpayer had to previously prove "reckless" or "intentional" disregard by an IRS employee); makes it easier for a spouse to be exempt from liability for the tax mistakes of the other spouse; and changes House rules to discourage enactment of legislation adding complexity to the tax code.
The provisions in this bill that shift some of the burden of proof in tax disputes from the
taxpayer to the IRS encourage my belief that the Government can become more responsive
and more accountable to the people. Most taxpayers accept IRS challenges to valid exemptions because they are intimidated or can't afford to fight the Federal Government in court. By shifting the burden of proof, the IRS is forced to back up its challenges so that law abiding taxpayers are not forced to forfeit money that is legally theirs.
I believe that the IRS must fulfill its mission of administering our tax laws and enforcing collection. However, it cannot be permitted to abuse the rights of American taxpayers. H.R. 2676 will go a long way toward correcting abuses and ensuring that the agency is restructured in such a way that honest hardworking taxpayers need not fear undue harassment and reprisals from the IRS. Perhaps people like Carlton will be able to maintain their businesses and fulfil their dreams.
The IRS has a Problem Resolution office (PRP), which provides assistance to taxpayers whose problems are not resolved through normal IRS channels. If you have a problem that hasn't been resolved in prior contacts with the IRS, you may call PRP at 1-800-829-1040. You may also find helpful information on the IRS homepage located at: http://www.irs.ustreas.gov/.
-The Honorable Elijah E. Cummings represents the 7th Congressional District of Maryland in the United States House of Representatives.