This week, Representative Peter Roskam (IL-06) achieved key victories when three of his priorities moved through the House as part of a larger IRS redesign package:
H.R. 1843 -- the Clyde Hirsch Sowers Restraining Excessive Seizure of Property through the Exploitation of Civil Asset Forfeiture Tools (RESPECT) Act which addresses IRS overreach by limiting their civil asset forfeiture authority. The bill would require the IRS to show probable cause that the funds of a business suspected of criminal activity were derived from an illegal source or connected to other criminal activity. It also would provide important procedural protections, including a post-seizure hearing, for people whose assets the IRS has seized within 30 days after the seizure, or longer, if the asset-owner requests an extension. If a court determines the government should return funds and interest to a person whose funds were seized by the IRS based on allegations of structuring, the interest will be exempt from income tax.
H.R.3641 -- the Free File Permanence Act of 2017 which makes the Free File Program permanent, ensuring millions of Americans can use the popular tax filing service of their choice to file their federal income taxes for free. The program saves the federal government approximately $13 million dollars in processing costs annually, as electronic filing costs less than 5 percent of the cost of processing a paper return.
H.R. 2901 -- the Volunteer Income Tax Assistance Permanence Act of 2017 (VITA) which would authorize the Internal Revenue Service (IRS) to administer a program where the federal government partners with the local community to provide tax preparation services for individuals with an annual income of less than $54,000 and those with limited proficiency in English. The legislation also ensures that VITA grant recipients, who already have accuracy rates of 94 percent, including tax returns claiming the Earned Income Tax Credit, maintain strong records of accuracy that will save taxpayers money.
"The Tax Cuts and Jobs Act provided tax relief to millions of Americans; now we're taking the next step and redesigning and modernizing the IRS to work for taxpayers. These bills are part of that process and will help put an end to IRS abuse of authority and provide another avenue to help people simplify the tax filing process," said Rep. Roskam. "The IRS has acted particularly egregiously in regards to civil asset forfeitures and Congress has a responsibility to hold them accountable on behalf of the people we represent," he continued.
For nearly two years, the Ways and Means Oversight Subcommittee has been investigating the IRS' abuse of its civil asset forfeiture authority. The Subcommittee found IRS Criminal Investigation was seizing funds that appeared to have been used transactions "structured" to be under $10,000 to avoid Bank Secrecy Act reporting requirements. When business owners tried to get their money back, the case would be sent to the Department of Justice; frequently, DOJ attorneys would hold the funds long enough that the business owners felt compelled to settle the case and give up a portion of the funds to get the remainder returned to them.