Taxpayer Notification and Privacy Act

Floor Speech

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Mr. SMITH of Missouri. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 6495) to amend the Internal Revenue Code of 1986 to provide for specific taxpayer notice when information is sought from third parties, as amended.

The Clerk read the title of the bill.

The text of the bill is as follows: H.R. 6495

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE.

This Act may be cited as the ``Taxpayer Notification and Privacy Act''. SEC. 2. SPECIFICITY OF THIRD-PARTY CONTACT NOTICES.

(a) In General.--Paragraph (1) of section 7602(c) of the Internal Revenue Code of 1986 is amended--

(1) by striking ``and'' at the end of subparagraph (A),

(2) by redesignating subparagraph (B) as subparagraph (C),

(3) by inserting after subparagraph (A) the following new subparagraph:

``(B) in any case in which the information sought to be obtained from such other persons is related to determining tax liability, has not been previously requested from the taxpayer, and could reasonably be provided by the taxpayer, identifies each specific item of information intended to be sought from such persons, and'', and

(4) by amending subparagraph (C), as redesignated by paragraph (2), to read as follows:

``(C) except as otherwise provided by the Secretary, provides the taxpayer with reasonable opportunity and a period of not less than 45 days (or more, if the taxpayer requests additional time and shows reasonable cause) to respond before contact is made with such other persons.''.

(b) Exception.--Section 7602(c)(3) of the Internal Revenue Code of 1986 is amended--

(1) by redesignating subparagraphs (A), (B), and (C) as clauses (i), (ii), and (iii), respectively, and by moving such clauses 2 ems to the right,

(2) by striking ``Exceptions.--This subsection'' and inserting ``Exceptions.--

``(A) In general.--This subsection'', and

(3) by adding at the end the following new subparagraph:

``(B) Exception for information specificity.--Subparagraph (B) of paragraph (1) shall not apply to information sought from a person other than the taxpayer if the Secretary determines that such information is necessary.''.

(c) Effective Date.--The amendments made by this section shall apply to notices provided under section 7602(c) of the Internal Revenue Code of 1986 after the date that is 12 months after the date of the enactment of this Act.

Mr. Speaker, I rise in support of H.R. 6495, the Taxpayer Notification and Privacy Act, bipartisan legislation introduced by Representatives Greg Steube and Jimmy Panetta.

When the IRS seeks information about a taxpayer, the agency should not be able to go behind their back without their knowledge. Yet, right now, the IRS can do just that.

Currently, the IRS is not required to notify a taxpayer who is under review or investigation about what information the agency is seeking; who it may have contacted; or, for that matter, give the taxpayer the opportunity to provide the information themselves. This puts the individual taxpayer in a situation where their privacy, their livelihood, or their reputation could all be unduly harmed.

That is unacceptable. Thanks to Representative Steube--a tireless advocate for the American taxpayer--who has been focused on holding a powerful agency like the IRS accountable, taxpayers will be better protected.

Among the supporters of this bill is the National Taxpayer Advocate, the independent organization tasked with helping taxpayers solve problems with the IRS. Their recommendations align with the changes this legislation would enact to strengthen taxpayer rights.

It is not only about protecting a right to privacy but also the principle of fairness that all Americans should be afforded under the law.

Mr. Speaker, I encourage my colleagues to support this legislation, and I yield back the balance of my time.

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