By an overwhelming bipartisan margin Thursday, Congress shipped President Clinton election-year legislation revamping the IRS and expanding the rights of Americans battling the government's widely unpopular tax collector.
The Senate approved the measure 96-2, just two weeks after the House endorsed it by 402-8. When Clinton affixes his promised signature, it will mark the most profound changes in the agency since 1952."There are 168 ways that this bill makes the IRS more service-oriented and taxpayer friendly," said Sen. Pete Domenici, R-N.M., just before the vote.
The Senate had spent all day Wednesday discussing the legislation, and little but acclaim flowed from lawmakers of both parties.
Sen. Orrin Hatch, R-Utah, a member of the Finance Committee that held hearings on IRS abuses, said the bill is "a leap forward in eradicating a culture that has allowed corruption and abuse to occur over and over again."
He told the Senate, "This legislation can be summed up in one word: accountability. For too long, the IRS and its employees have operated in an environment with little or no accountability. This bill changes all that."
Hatch said, "We expect the IRS to assist taxpayers to understand and comply with complicated laws and regulations. We expect taxpayers to be treated courteously. We expect taxpayers' questions to be answered promptly and their returns processed efficiently. And we expect any penalties to fit the crime."
"While the IRS will never be popular," said Sen. Richard Bryan, D-Nev., the bill will create "a more efficient and user-friendly service."
Praise also flowed from the Clinton administration, which resisted congressional attempts to overhaul the agency until after the hearings last September. Those televised sessions featured taxpayers and IRS employees who wove tales of abusive agency conduct, creating unstoppable political momentum for change.
"This bill will help give Americans an IRS that is not only off people's backs but is, more importantly, on their side," said Vice President Al Gore.
The bill would shift the burden of proof from the taxpayer to the IRS in many tax court cases and make it easier for someone winning a tax case to have his costs reimbursed by the government. It also would forbid the IRS from forcing people to pay interest and some penalties if the agency did not notify them of the problem within 18 months of filing their return.
A nine-member board - including six private citizens - would oversee the operations of the 102,000-employee agency. Workers could be fired for hiding mistakes, and the power and number of the IRS's taxpayer advocates would be expanded.
Supporters said the measure would help mold an agency that taxpayers would find more accessible and less intimidating.
Yet experts said the changes in taxpayers' rights would affect relatively few people. Of the 212 million personal and business returns filed annually, only about 4 million to 5 million end up in dispute with the IRS, said Phil Brand, the agency's former chief compliance officer.