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Bipartisan group looks to push IRS towards simpler math error notices

The IRS MATH Act would require the tax agency to send more specific, straightforward notices when it corrects simple math errors on tax returns.

A bipartisan, bicameral group has honed in on the notices millions get in their mailboxes annually when the IRS makes adjustments to returns with simple math or clerical fixes. 

The problem is that those notices are often “vague and confusing,” as the National Taxpayer Advocate, an independent organization at the IRS meant to focus on taxpayer issues and rights, wrote in a 2022 blog post

The Internal Revenue Service Math and Taxpayer Health Act, or the IRS MATH Act, is meant to change that. 

Sens. Elizabeth Warren, D-Mass., and Bill Cassidy, R-La., and Reps. Bill Schneider, D-Ill., and Randy Feenstra, R-Iowa, introduced the proposal last Thursday to address recommendations from the Taxpayer Advocate, said Schneider.

These math error notes are sent when the IRS uses its authority to quickly adjust returns with simple math or clerical problems.

As they are, some math error notices don’t tell individuals receiving them what the problem with their return was exactly, instead offering a list of potential problems. 

“Filing your taxes can get confusing — and sometimes, mistakes happen,” Warren said in a statement. “And when they do, taxpayers shouldn’t be forced to decipher confusing, intimidating, and financially-impactful letters from the IRS.”

The lawmakers say that the current notices also don’t give taxpayers enough information on how to contest the adjustment — something taxpayers have only 60 days to do, unlike other types of IRS adjustments that have a notice period and are challengeable in U.S. Tax Court. 

If passed, the bill would direct the IRS to improve the notices with more specific information on the error in plain language, including providing the specific line item on the return where the error was made and explaining the reason for the change.

The tax agency would also have to include an IRS automated hotline for requesting tax account transcripts on the notice, put the 60-day date at the front of the page in big, bold letters and give in-person and telephone options for requesting an abatement of the adjustment, among other things.

“If there’s a mistake on a tax return, the IRS needs to explain it in plain English,” Cassidy said in a statement. 

If the bill does pass, it’ll add to ongoing work at the IRS to clean up notices it sends to taxpayers. 

The tax agency launched its “Simple Notice Initiative” at the start of the year, committing to redesigning up to 200 of the most common notices it sends to individual taxpayers by the start of next year’s tax season. The IRS sends approximately 170 million notices annually. 

The goal is that the agency will field fewer calls and in-person visits for help as a result, IRS Commissioner Danny Werfel told reporters at the time, saying that the initiative is part of the agency’s broader work to “create a tax system that works better and is easier to understand.”