Today, on income tax day, U.S. Senator Jeanne Shaheen (D-N.H.) introduced legislation to streamline the federal tax return process. Shaheen's Simpler Tax Filing Act would pave the way for the Internal Revenue Service to provide many tax filers with a one-page tax return already filled out with the taxpayer's information, known as a "simple return," in turn saving American taxpayers billions in tax preparation fees.
"Tax Day in America has become tantamount to billions of dollars spent on some redundant efforts," Shaheen said. "My bill would be a step toward reforming this overly complex process. A simple return is a smart and simple fix that would help make the federal income tax process easier for millions of Americans and will also help consumers save billions."
Presently, Americans spend more than 6 billion hours preparing their tax returns with almost 60 percent of taxpayers hire paid tax preparers. Much of the time taxpayers spend is duplicative, filing information the IRS already collects from employers and financial institutions. Under Shaheen's proposal, the Treasury -- in consultation with the Taxpayer Advocate Service -- would be required to issue a report detailing the actions necessary to achieve the goal of offering prepared tax filers by 2018.
Once implemented, the IRS would first notify eligible taxpayers that they have the option of filing a "simple return" before later sending eligible taxpayers a one-page return already filled out with pertinent information. The taxpayer would then double-check the form for accuracy before filing it electronically.
The simple return would become a voluntary program that could be offered to as many as 40 percent of Americans and save up to 225 million hours of taxpayers' time and $2 billion annually in tax preparation fees.