What's New? Highlights of the Taxpayer First Act of 2019

With the aim of improving the interaction between the IRS and taxpayers, the Taxpayer First Act of 2019 (TFA) was signed into law on July 1. The bill includes a number of adjustments to the IRS’s organizational structure, customer service and enforcement procedures, and provides some new safeguards to taxpayers. The significant changes are summarized below.

  • Establishment of an independent appeal process

The TFA officially establishes the IRS Independent Office of Appeals to resolve federal tax controversies without litigation. The bill also requires the IRS to provide more information to taxpayers on how the appeal was decided and, in some cases, requires the agency to provide a written explanation in the event of a denial.

  • Improvement in IRS service

The IRS is required to submit a comprehensive customer service strategy along with a detailed plan to Congress within one year of TFA’s enactment. The plan will include customer expectations and improvement goals.

  • Exceptions regarding OIC agreement

Low-income taxpayers who propose an offer-in-compromise agreement with the IRS may be eligible to waive the application fee and initial payment.

  • Modification in enforcement procedures

The TFA limits IRS enforcement procedures, including the issuance of a summons, seizure of property (post-seizure review is now required) and joint liability.

  • Expansion of electronic filing requirements

The threshold for mandatory electronic filing will be reduced from 250 returns in 2020 to 10 returns in 2022, which means the majority of tax preparers will have to e-file after 2022. Meanwhile, tax-exempt organizations filing a Form 990 now are required to file electronically for taxable years beginning after July 1, 2019. Defined “small tax-exempt organizations” will have an e-filing requirement after July 1, 2021.

Besides these changes, the TFA also reforms the whistleblower’s program, which allows the IRS to exchange information and update claim status with informers. Certain enhancements surrounding internet technology are also required, such as providing an online platform for Form 1099 filing and automated programs for the disclosure of taxpayer information.

Work cited:

https://www.cpajournal.com/2019/09/03/top-ten-changes-in-the-taxpayer-first-act-of-2019/

https://www.castroandco.com/blog/2019/july/the-taxpayer-first-act-of-2019-special-castro-re/

You’ve heard our thoughts… We’d like to hear yours

The Schneider Downs Our Thoughts On blog exists to create a dialogue on issues that are important to organizations and individuals. While we enjoy sharing our ideas and insights, we’re especially interested in what you may have to say. If you have a question or a comment about this article – or any article from the Our Thoughts On blog – we hope you’ll share it with us. After all, a dialogue is an exchange of ideas, and we’d like to hear from you. Email us at contactSD@schneiderdowns.com.

Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

© 2019 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

our thoughts on

TCJA – Could 2019 Taxable Income be Higher than Projected?
Belsnickel is Coming… Are You A Nice Boy or Girl?
Belsnickel is Coming… Are You A Nice Boy or Girl?
Syndicated Conservation Easements Create Ire in the IRS
Syndicated Conservation Easements Create Ire in the IRS
TCJA – Could 2019 Taxable Income be Higher than Projected?

Register to receive our weekly newsletter with our most recent columns and insights.

Have a question? Ask us!

We’d love to hear from you. Drop us a note, and we’ll respond to you as quickly as possible.

Ask us

contact us

Map of Pittsburgh Office
Pittsburgh

One PPG Place, Suite 1700
Pittsburgh, PA 15222

contactsd@schneiderdowns.com
p:412.261.3644     f:412.261.4876

Map of Columbus Office
Columbus

65 East State Street, Suite 2000
Columbus, OH 43215

contactsd@schneiderdowns.com
p:614.621.4060     f:614.621.4062

Map of Washington Office
Washington, D.C.

1660 International Drive, Suite 600
McLean, VA 22102