On July 1, 2019, the Taxpayer First Act of 2019 was signed into law and aims to strengthen taxpayer rights and make IRS services more taxpayer-friendly.
The IRS’s main goals as a result of the Taxpayer First Act are:
- To improve taxpayer experience
- To modernize the IRS by increasing electronic operations while strengthening traditional services
- To increase organization within the tax administration
- To increase cybersecurity and identity protection
- To enforce a fair and just tax system
These big goals will directly affect much of the IRS’s process and procedure in the future, but what does it mean for your business?
Cybersecurity and Identity Protection
As more and more business and personal experiences migrate to digital platforms, the importance of multifaceted cybersecurity only increases. Under the TFA, the IRS will tackle the issues of identity protection and combating identity fraud.
Taxpayer information access will be restricted to decrease the possibility of fraud and other issues; and no local, state, or federal agency will be permitted to request that information from the IRS if it does not have specific protocols in place to protect it.
In order to catch errors and identity theft more quickly, all taxpayers are now eligible to receive PINs, previously only offered to individuals whose identities had been stolen in the past.
As millions of people flooded government websites to apply for unemployment in early 2020, individuals and businesses know customer operations in government arenas are not easy to navigate. Customer service is of utmost importance for any business, and the IRS is no exception.
The TFA has now required the IRS to make operations more taxpayer-friendly. This includes things like increased transparency in reporting and communications, assistance programs, and more.
Much of the focus will be on modernizing customer access areas like online portals and improving telephone services.
New Appeals Process
In the past, appeals were processed through the IRS Office of Appeals – an office tasked with examining the IRS’s activities and, when necessary, resolving issues without legal intervention. But the previous appeals system left much to be desired from the taxpayers’ perspective.
While it will look very similar to what’s currently in place, the new Independent Office of Appeals has been codified and seeks to increase transparency throughout the entire appeals process, giving more power to taxpayers.
Expanded Electronic Services
To improve filing efficiency, the Taxpayer First Act will also expand electronic filing and payment options. This means businesses are encouraged to file online as well, if they aren’t already doing so.
Efiling reduces human error and keeps more accurate and precise information organized.
Better for Taxpayers
As a whole, the Taxpayer First Act is designed to protect taxpayers in more ways while also emphasizing the need for accountability in the IRS and its dealings.
Though the original TFA required the IRS to solidify many of the goals and plans mentioned above by July 1, 2020 (the one-year anniversary of the TFA’s passing) many of the initiatives have been postponed due to the COVID-19 pandemic and subsequent postponement of tax filing and payment deadlines to July 15 of this year.
To learn more about electronic filing, sign up for a free eFile360 account.