Did you know that there is an entity within the IRS that is specifically designed to advocate for taxpayers? The Taxpayer Advocate Service serves as the voice of taxpayers in meetings with Congress members and their staffs, in testifying at hearings on problems faced by taxpayers, and in working with the tax-writing committees in Congress. Recently, the Taxpayer Advocate Service has been working to create a “Taxpayer Bill of Rights.” The Taxpayer Bill of Rights is one of the many recommendations documented in the National Taxpayer Advocate 2013 Annual Report to Congress.
The U.S. tax system is built on voluntary compliance. Voluntary compliance is much cheaper than enforced compliance because the government does not have to spend money to collect taxes that are voluntarily paid. Taxpayer rights are central to voluntary compliance. If taxpayers believe that they might be treated unjustly, they will mistrust the tax system and be less likely to voluntarily comply with the laws. If taxpayers have confidence in the honesty and fairness of the tax system, they are much more likely to comply.
There are actually many taxpayer rights scattered throughout the Internal Revenue Code, but they are often difficult to find, and not always organized or presented in a logical and consistent way. Compare this to the U.S. Constitution’s Bill of Rights, which is both organized and presented in a way that our citizens and government can understand. According to the Taxpayer Advocate Service, a Taxpayer Bill of Rights will serve the same function in the area of taxation. A list of core taxpayer rights would serve as an organizing principle for tax administrators in establishing agency goals and performance measures, provide foundational principles to guide IRS employees in their dealings with taxpayers, and provide information to taxpayers to assist them in their dealings with the IRS.
Included in the proposed Taxpayers Bill of Rights are the following points:
1. The right to be informed2. The right to quality service3. The right to pay no more than the correct amount of tax4. The right to challenge the IRS’s position and be heard5. The right to appeal an IRS decision in an independent forum6. The right to finality7. The right to privacy8. The right to confidentiality9. The right to retain representation10. The right to a fair and just tax system, including access to the taxpayer advocacy service
The National Taxpayer Advocate recommends that the IRS adopt and promote a Taxpayer Bill of Rights and actively apply its principles to all IRS strategic planning, compliance, and taxpayer service activities. In addition, the Advocate claims that the IRS has a responsibility to perform outreach and education to taxpayers so that taxpayers know their rights and can avail themselves of those rights, thus ensuring trust in our tax system.
To learn more about the Taxpayer Advocate Service or the Taxpayer Bill of Rights, visit The National Taxpayer Advocate 2013 Annual Report.
These free resources should not be taken as tax or legal advice. Content provided is intended as general information. Tax regulations and laws change and the impact of laws can vary. Consult a tax advisor, CPA or lawyer for guidance on your specific situation.