In light of the IRS’ unique role as the federal revenue collector, the National Taxpayer Advocate recommends that Congress develop new budget procedures designed to fund the IRS at a level that will enable it to meet taxpayer needs and maximize tax compliance, with due regard for protecting taxpayer rights and minimizing taxpayer burden.
The report urges Congress to codify a Taxpayer Bill of Rights that would clearly list the major rights and responsibilities of taxpayers. “The U.S. tax system is based on a social contract between the government and its taxpayers,” Olson wrote.
“Taxpayers agree to report and pay the taxes they owe and the government agrees to
provide the service and oversight necessary to ensure that taxpayers can and will do so.”
Most taxpayers don’t know their rights. Over the past two decades, Congress has
enacted three significant taxpayer rights’ bills, but the number of bills and the lack of
publicity have muddled the message. The report describes a recent taxpayer survey in
which 55% of respondents said they did not believe they had rights before the IRS and
61% did not know what their rights are.
“I believe taxpayers and tax administration will benefit from an explicit statement of
what taxpayers have a right to expect from their government and what the government
has a right to expect from its taxpayers,” Olson said.