IRS Embraces Long-Sought Taxpayer Bill of Rights

In a rare joint press appearance, the head of the Internal Revenue Service and the independent national taxpayer advocate on Tuesday announced that the tax agency has adopted the long-discussed Taxpayer Bill of Rights.

The 10 briefly expressed principles -- which begin with the right to be informed and the right to quality service -- have been posted prominently on the IRS website. They will also appear in a revised edition of “Publication One,” which goes out to 30 million taxpayers a year, and will soon be displayed on posters in offices all over the country, according to Commissioner John Koskinen and Taxpayer Advocate Nina Olson, who spoke to reporters at IRS headquarters.

“These core concepts are each in the tax code, but they’re not easy to find or understand,” Koskinen said. “Now is time to highlight and showcase them for all to plainly see,” he said. “It shows that not only are the rights available in law, but the IRS respects them,” Koskinen said, adding that by adopting the 10 rights, his agency hopes to “improve our working relationship with taxpayers.”

The timing of the adoption had little to do with the ongoing political controversy he inherited over IRS mishandling of nonprofit applications for tax-exempt status, the commissioner said. But having traveled to 28 field offices and met with 10,000 employees in his first six months on the job, Koskinen found that employees “are focused on trying to do a better job of communicating taxpayer rights to the public but they’re concerned about not having enough resources to respond to taxpayer needs.”

The announcement’s timing was also related to the end of the filing season, when taxpayers are receiving questions from the IRS about their returns, and to a meeting Koskinen had with Olson about what the agency could do that doesn’t require new resources. The IRS budget, he noted, has been cut by $850 million or 7 percent since 2010, “which complicates the work we do since we don’t have enough people answering phones, so this will help us make our case to Congress.”

Olson, who works within the IRS but does not report to the commissioner, first proposed a Taxpayer Bill of Rights in 2007. She repeated the recommendation in her annual report in 2011, and in 2013 made it a top priority. The House passed a similar version of the bill of rights in February, but the Senate has not acted. She said she wrote the original set of rights based on the U.S. Bill of Rights and a similar document from the Organisation for Economic Co-operation and Development.

The rights “are symbolic, but incredibly important,” Olson said, recalling a 2012 survey that found only 46 percent of taxpayers believed they had rights and only 11 percent knew what those rights were. “If they don’t know, they won’t avail themselves,” Olson said. The rights will also “make IRS employees feel better about their jobs” by serving as a “framework for effective tax administration,” a kind of “sanity check” on proposed new IRS initiatives that also produce new enforcement remedies.

The simple document’s “bucket of rights provide the recognition,” Olson added, and will be elaborated on in a “crosswalk” linked to the relevant statutes and, eventually, pertinent IRS publications and videos. The “right to quality service also serves as a message to Congress that the IRS has to have the correct level of resources,” Olson said.

In her mid-year report last June, Olson applied the 10 rights to the facts from the May 2013 audit from the Treasury Inspector General for Tax Administration that triggered the multiple investigations of the Exempt Organizations Division’s handling of applications from primarily conservative nonprofit groups. She found that eight of the 10 rights had been violated.

Koskinen said he did not believe the Taxpayer Bill of Rights would increase anyone’s chances of prevailing in litigation. It is intended more to assure that “taxpayers know their rights and that the IRS is happy to have them exercise them,” he said.