Virginia Birkofer

One Way to Reform the IRS is Through Passing the Refund Rights for Taxpayers Act

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Posted by Virginia Birkofer on Tuesday, July 18th, 2017, 1:41 PM PERMALINK

In recent years, the IRS has proven itself to be one of the most dysfunctional federal agencies. It is not surprising that the agency is extremely unpopular. In the last several years, official watchdogs have found the agency has failed in its responsibility to taxpayers on multiple occasions.

For instance, in the past few years, the Inspector General has found that the IRS has mispaid 31% of their employees, blocked public access to their trials, given bonuses to tax delinquent employees, shortchanged taxpayers by $1.2 million, lost track of computers with sensitive taxpayer information on them, and wasted $12 million on an unstable email system to name a few instances demonstrating incompetency. 

Clearly, there is need for reform that ensures the agency treats taxpayers with respect. One law that can be changed is 26 U.S. Code § 6511, which gives taxpayers just three years to claim a refund from the IRS when they overpay. If they fail to claim the refund in this time period, any money becomes the property of the government. In contrast, 26 U.S. Code § 6502, gives the IRS an entire decade to correct tax mistakes. This is patently unfair given that it is these federal bureaucrats entire job to audit taxes.

To address this discrepancy, Congressman Neal Dunn (R-Fla.) recently introduced “The Refund Rights for Taxpayers Act,” legislation that ensures taxpayers and the IRS have the same amount of time to correct any mistake that results in the payment of either too much or too few in taxes.

The Refund Rights for Taxpayers Act allows taxpayers to claim overpaid taxes from the IRS for seven years. It also reduces the time the IRS has to collect additional taxes from taxpayers to seven years.

This is a simple, yet important solution to ensuring that bureaucrats will be held to the same standards that everyday Americans are held to.

Moreover, reducing the time period the IRS has to collect back taxes will also guarantee that the agency is held to the high standard that the American people expect.

Members of Congress and the current administration can demonstrate their commitment to reforming the IRS and protecting taxpayers by supporting and co-sponsoring the Refund Rights for Taxpayers Act.

[ATR’s letter of support for the Refund Rights for Taxpayers Act can be found here.]

 

Photo Credit: Photo in the Public Domain, link:https://commons.wikimedia.org/wiki/File:IRS_Building_Constitution_Avenue.jpg

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Rep. Guthrie Proposal Should Be Part of the Solution to Increase Acesss to Healthcare

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Posted by Virginia Birkofer on Thursday, July 6th, 2017, 9:00 AM PERMALINK

While much of the healthcare debate has focused on ensuring individuals have health insurance and choice, less attention has been paid to whether individuals have access to the care they need.

This problem of access to care is likely to get worse in the future. By 2020, there will be a shortage of 91,000 doctors, according to an estimate by the Association of American Medical Colleges. This shortage will be felt especially hard in medically underserved communities, defined as areas of population with few primary care providers, and high infant mortality, high poverty, or a high older adult population.

H.R. 592, the Pharmacy and Medically Underserved Areas Enhancement Act seeks to address the shortfall of healthcare coverage in medically underserved areas by allowing qualified pharmacists to perform certain healthcare services.

By designating pharmacists as “non-physician providers” under Medicare Part B, this legislations would allow trained professionals to provide certain patient care services based on what is permitted under a state’s scope of practice laws. In turn, this would help meet the shortage of physicians and the demand for healthcare services by allowing the healthcare needs of underserved communities to be met.

While this legislation may increase costs initially, over the long term H.R. 592 would result in strong savings. As noted in a report to the U.S. Surgeon General, increasing access to care could provide $4 in health care savings for every $1 spent. Individuals that are not receiving upfront healthcare treatment from physicians inevitably must be treated later when their condition has deteriorated at a greater expense to the healthcare system.

As a result, this legislation will streamline the healthcare system and allow the truly needy access to care. ATR wrote a letter of support to Congressman Guthrie in support of H.R. 592.

Expanding the ability of the truly needy to access care will result in billions of savings over the long term and decrease pressure on the nation’s health system. As such, this important legislation should be supported by all Members of Congress.

Photo Credit: Photo Credits: Candis Kinkus

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IPAB Should Be Repealed

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Posted by Virginia Birkofer on Thursday, July 6th, 2017, 8:00 AM PERMALINK

Congress continues to make progress on phase one of healthcare reform through the Senate’s “Better Care Reconciliation Act,” legislation that repeals key parts of Obamacare. Moving forward, there are many other reforms that Congress should make to the nation’s healthcare system that promote access to care, fiscal responsibility, patient choice, and state flexibility. One obvious reform should be the repeal of the Independent Advisory Payment Board (IPAB).

IPAB was created seven years ago when Obamacare was signed into law. The basic role of IPAB is to institute price controls and rationing within the Medicare system. In practice, this leaves the U.S. healthcare system with the same price controls attempted (and failed) in socialized medicine systems seen throughout the world.  

IPAB’s scope and role also undermines the constitutionally granted authority that Congress has over the power of the purse. IPAB bureaucrats are free to institute price controls they see fit without approval from Congress. As a result, this board has immense power over health outcomes and the livelihood of patients and doctors.

Repealing IPAB is not controversial – there is broad consensus from a range of stakeholders. Allowing the board to operate will result in indiscriminate cuts to Medicare that undermine healthcare choice and access of 55 million Americans.

Congress has several legislative options to repealing IPAB. Lawmakers have a brief window to repeal IPAB by passing the “Protecting Medicare from Executive Action Act of 2017” (S.J. Res. 17/H.J. Res. 51). This option allows Congress to discontinue IPAB through an expedited legislative process, but must be used before mid-August.

If they choose not to go down this path, Congress can pass H.R. 849, legislation introduced by Congressman Phil Roe (R-TN). This bipartisan legislation has more than 200 co-sponsors and could be considered as a stand-alone proposal or as part of broader healthcare reforms.

While repeal of IPAB is scored as costing $7.6 billion over the next decade, this should not be an impediment to repealing the board, as current law assumes some price controls will already go into effect. Given other stages of healthcare reform will produce significant savings that reduce the deficit, repealing IPAB should not be constrained by the need to find corresponding offsets.

This year, Congress and the administration have an opportunity to implement bold healthcare reform. Repealing IPAB and the price controls that the board will implement should be part of this legislative agenda. 

Photo Credit: Photo Credits: John Barry Miller

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ATR Supports Representative Johnson's "No Bonuses for Tax Delinquent IRS Employees" Act

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Posted by Virginia Birkofer on Monday, June 26th, 2017, 8:00 AM PERMALINK

The Treasury Inspector General for Tax Administration found in a 2014 report that the IRS is giving out bonuses to employees with outstanding tax obligations. This is not a hypothetical concern, the report found that the IRS has handed out over $1 million in bonuses, 10,000 hours in extra time off, and 69 step increase to more than 1,100 employees with tax problems. This report highlights the IRS’s continued misuse of funds, prompting the need for immediate reform within the agency.

These IRS employees are failing to comply with the very laws they were hired to enforce. The IRS and its employees cannot continue to be treated as above the law. To hold IRS employees to the same standards American taxpayers are obligated to follow, Representative Sam Johnson (R-TX) has proposed H.R. 1599, The “No Bonuses for Tax Delinquent IRS Employees Act.”

This legislation will prohibit the IRS from providing bonuses or other performance related award to IRS employees that have outstanding federal tax debt. In a show of support, ATR wrote to Congressman Johnson, stressing the importance of this legislation to all members of congress to ensure the IRS is held accountable to the American people.

The full letter can be found here and is pasted below:

June 20, 2017

The Honorable Sam Johnson
United States House of Representatives
2304 Rayburn House Office Building
Washington, D.C. 20515

Dear Congressman Johnson:

I write in support of H.R. 1599, the “No Bonuses For Tax Delinquent IRS Employees Act.” This legislation prohibits the Commissioner of the Internal Revenue Service from providing bonuses or other performance related award to IRS employees that have outstanding federal tax debt.

The concern that the IRS is giving bonuses to tax delinquent employees is not hypothetical. The agency has handed out over $1 million in bonuses, 10,000 hours in extra time off, and 69 step increases to more than 1,100 employees with tax problems, according to a 2014 report by the Treasury Inspector General for Tax Administration.

These employees are failing to comply with the very laws they were hired to enforce. Taxpayers are expected to comply with federal law, and it is only reasonable to expect IRS employees to be held accountable to the same standard.

In recent years, the IRS has claimed it does not have enough taxpayer resources to properly do its job. At the same time, the agency has been found to have committed numerous improper activities, most notably when the IRS Exempt Organization Division led by Lois Lerner targeted non-profit conservative groups. This is just one of many instance the IRS has failed to do its job and there is clear need for reform within the agency.

Supporting the No Bonuses For Tax Delinquent IRS Employees Act is a matter principle. The simple fact is, IRS employees who are failing to comply with the tax laws they are employed to enforce should be held accountable. Members of Congress should support this important legislation and ensure the IRS is held accountable to the American people.

Onward,

Grover G. Norquist

President, Americans for Tax Reform

 

 

Photo Credit: Photo in the Public Domain, link: https://www.flickr.com/photos/congressman-sam-johnson/4990298810/in/dateposted/

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Coalition Urges Support for Increased Oversight Over CMMI

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Posted by Virginia Birkofer on Monday, June 12th, 2017, 9:00 AM PERMALINK

ATR President Grover Norquist today joined with six other free market, conservative groups urging increased oversight for the Obamacare Centers for Medicare and Medicaid Innovation (CMMI). 

CMMI is tasked with conducting demonstrations over new health care delivery and payment models in Medicare, Medicaid, and the Children’s Health Insurance Program with the intent of reducing healthcare costs.

However, the agency is implementing tests with little, or no evidence that it would result in savings, while also strong-arming healthcare providers and patients into participating. Congress is also limited in its ability to conduct routine and necessary oversight.

Concurrently, the Congressional Budget Office has adjusted the budget baseline under the assumption that proposed CMMI demonstrations have already entered into effect and are successful. This only further binds the hands of lawmakers as any attempt to block a demonstration from being implemented is scored as increasing the deficit, even though these demonstrations are in their infancy.

The full letter can be found here and is pasted below:

June 12, 2017

The Honorable Tom Price
Secretary, Department of Health and Human Services
200 Independence Avenue, SW
Washington, D.C. 20201

Dear Secretary Price:

On behalf of the undersigned organizations, we write to reiterate our long-standing support for full repeal of Obamacare including repeal of the Centers for Medicare and Medicaid Innovation (CMMI).

In the meantime, we urge you to institute several common-sense guardrails around CMMI to prevent it from doing unnecessary harm to patients and providers.

As you know, CMMI was created when Obamacare was signed into law seven years ago. The agency was tasked with conducting demonstrations over new health care delivery and payment models in Medicare, Medicaid, and the Children’s Health Insurance Program with the intent of reducing healthcare costs.

Although CMMI’s demonstrations were supposed to increase the efficiency of healthcare programs, the Obama administration pushed these tests with little evidence they would result in savings, while strong-arming healthcare providers and patients into participating.

The agency is also not under the normal appropriations process – Obamacare gave CMMI $10 billion every decade in perpetuity. As a result, Congress is limited in its ability to conduct routine, necessary oversight.

Concurrently, the Congressional Budget Office has adjusted the budget baseline under the assumption that proposed CMMI demonstrations have already entered into effect and are successful. This only further binds the hands of lawmakers as any attempt to block a demonstration from being implemented is scored as increasing the deficit, even though these demonstrations are in their infancy.

Given these facts, it is clear that the agency needs to be restrained. As such, we suggest four guardrails be implemented. 

First, CMMI demonstrations should be true tests and not forced changes to policy. One way to do this would be to limit the number of affected beneficiaries to a small amount, such as 10 percent of the total beneficiary population, while also limiting the time period that any demonstration occurs.

Second, Congress should be included in the CMMI decision-making process. Rather than top down control, CMMI should consult with Congressional leadership and Committee chairs from both parties to prevent surprises and unintended consequences and gather input from key policymakers.

Third, participation in CMMI projects should be voluntary, not mandatory. A mandatory demonstration project on a broad population for an indeterminate period of time is a policy change, not a controlled test. In essence, this gives unelected bureaucrats the ability to make broad policy changes with few, if any consequences or limitations.

Fourth, greater input should be required from stakeholders in CMMI projects. Health providers and patients should be consulted ahead of time to give the agency better insight on how a CMMI demonstration will impact Americans. Doing so would ensure that demonstrations are truly conducted based on sound evidence and with the goal of increasing efficiency.

As Chairman of the House Budget Committee, you conducted important oversight over CMMI. As Secretary of HHS, we encourage you to continue this work and ensure that CMMI is held accountable.

Sincerely,

Grover Norquist
President, Americans for Tax Reform

Tom Schatz
President, Council for Citizens Against Government Waste

Adam Brandon
President, FreedomWorks

Carrie L. Lukas
Managing Director, Independent Women's Forum

Heather R. Higgins
President and CEO, Independent Women's Voice

Pete Sepp
President, National Taxpayers Union

Dr. Merrill Matthews
Resident Scholar, Institute for Policy Innovation

 

 

Photo Credit: Photo in the Public Domain, link:https://upload.wikimedia.org/wikipedia/commons/6/65/Repeal_ObamaCare_%284527428186%29.jpg

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Tax Reform Should Include Territoriality for Individuals

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Posted by Virginia Birkofer on Thursday, June 8th, 2017, 12:34 PM PERMALINK

Today, the U.S. is one of two countries that has citizenship-based taxation. This outdated system affects an estimated eight million Americans that live abroad. The final tax reform legislation should implement territoriality for individuals through the establishment of residence-based taxation.

In support of residence-based taxation, ATR submitted a statement for the record to the House Ways and Means official hearing entitled, “Increasing U.S. Competitiveness and Preventing American Jobs from Moving Overseas.” Urging the committee to ensure that residence-based taxation is implemented in the final tax reform legislation. [Read The Full Letter Here]

Implementing territoriality for individuals is crucial because under the existing system, American businesses are disadvantaged when competing with foreign competitors for they face double taxation and burdensome international rules.

However, the system of worldwide taxation is not limited to businesses. American citizens also face this system as they are taxed regardless of whether they reside in the U.S. or in a foreign country.

Under this system, American citizens residing abroad must comply with complex IRS rules and are double taxed on income - once when they earn it overseas and again by the U.S. government solely because they are citizens.

Moving to territoriality for individuals will end this needless double taxation. This reform will also increase job opportunities for Americans overseas and reduce the power of the IRS.

Currently, American citizens working overseas face a disadvantage compared to expatriates from other countries when applying for employment, as it is substantially more expensive for a business to hire an American under these tax laws. Implementing residence-based taxation will reduces compliance burdens associated with hiring Americans so that U.S. citizens working overseas are hired on a more level playing field and thereby increase job opportunities for Americans.

Moving to residence-based taxation has the added effect of diminishing the need for the IRS to act as a global police force. Because citizens residing abroad would (in most cases) no longer need to worry about paying U.S. taxes, this reform could reduce the size and scope of the IRS international division, allowing the agency to be streamlined.

It is vital that any tax reform legislation includes territoriality for individuals. Implementing a system where Americans are taxed based on their residence would make tax compliance far simpler and should be part of the effort to simplify the code for individuals.

 

 

Photo Credit: Photo in the Public Domain, link: https://commons.wikimedia.org/wiki/File:Individual_taxation_systems.png

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ATR Suports the ABLE Act to Help Families with Disabled Children

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Posted by Virginia Birkofer on Wednesday, May 31st, 2017, 2:48 PM PERMALINK

Having a child with special needs is exceedingly expensive, costing a family roughly $2 million in a lifetime. To give financial planning options to these families, Representative Cathy McMorris-Rodgers (R-WA) is introducing both the ABLE Financial Planning Act (H.R. 1897) and the ABLE to Work Act (H.R. 1896), coupled with Representative Tony Cardenas’ (D-CA) ABLE Age Adjustment Act (H.R. 1874). These three bills, collectively known as ABLE 2.0, greatly benefit families with special needs children—all without requiring a penny of new government spending.

By creating new savings vehicles on ABLE Accounts, this program lifts legal barriers off of families with special needs and allows them to move towards self-sufficiency and long term financial independence.

The ABLE program—authorized under the same provision that allows families to save in 529 plans for college—permits the families to set aside as much as $500,000 for education and a range of other “qualified expenses” for their child. In doing so, the ABLE program allows these families to plan for their future.

If helping families with special needs children is not reason enough, the ABLE Act also reduces individuals’ need to rely upon public assistance in the long run, for the program incentivizes private savings on the part of families.

This program costs the tax payers zero dollars, increases private savings, decreases individual’s reliance upon the government and provides a simplified financial safety net to American families selflessly supporting special needs children. In a show of support, a coalition letter signed by organizations including: R street, Campaign for Liberty, National Taxpayers Union, Americans for Tax Reform and the Coalition to Reduce Spending has been sent to all members of Congress. A program like this is key to helping families with special needs children and this legislation accomplishes that while not costing the taxpayers a dime. 

Photo Credit: Photo in the Public Domain, link: http://tpr.org/post/state-stands-behind-medicaid-cuts-disabled-children-now#stream/0

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ATR Supports Congressman Posey's Seniors’ Tax Simplification Act

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Posted by Virginia Birkofer on Wednesday, May 24th, 2017, 2:00 PM PERMALINK

Congressman Bill Posey (R-FL) is introducing H.R. 1397, the “Seniors’ Tax Simplification Act.” This legislation simplifies the tax code for American seniors by creating a new tax form.

By including information for the most common types of income reported by seniors - interest, dividends, capital gains, Social Security benefits, pension payments, IRA distributions, wages, and unemployment compensation, this bill streamlines the process for many of the 23 million seniors who file taxes each year.

A similar form currently exist for young taxpayers – the 1040EZ—and should be utilized as a model for tax simplification. Supporting this legislation would help many Americans navigate the complicated tax system when they file.  

Read the letter here or below. 

 

May 24, 2017
The Honorable Bill Posey
United States House of Representatives
120 Cannon Hob
Washington, D.C. 20515

 

Dear Congressman Posey:

I write in support the “Seniors’ Tax Simplification Act,” legislation that simplifies tax filing for American seniors by creating a new tax form.

This bill would instruct the IRS to create a new form in the 1040 series designed especially for senior citizens with relatively-simple tax filing situations. The most common types of income reported by seniors would be on it—interest, dividends, capital gains, Social Security benefits, pension payments, IRA distributions, wages, and unemployment compensation.  

For younger taxpayers, a similar form exists today—the 1040-EZ. It only reports wages, interest, and unemployment compensation. Any (childless) single taxpayer or married couple under age 65 making less than $100,000 is eligible to file this short form. Nearly 5 million taxpayers take advantage of this convenient form every year.

There is no reason why a similar form can’t be made available to seniors. 23 million tax returns are filed every year in households where the primary taxpayer is over age 65. Many of these taxpayers could use this form easily to make tax season less complicated.

Passage of the Seniors’ Tax Simplification Act is a common sense measure lawmakers can support to help seniors across the country. All members of Congress should have no hesitation supporting and co-sponsoring this helpful legislation.

Onward,

Grover G. Norquist

President, Americans for Tax Reform

 

 

 

 

 

Photo Credit: Photo in the Public Domain, link: https://upload.wikimedia.org/wikipedia/commons/5/5e/Bill_Posey.jpg

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Inspector General: IRS Mispays 31% of its Employees

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Posted by Virginia Birkofer on Thursday, May 18th, 2017, 5:05 PM PERMALINK

The IRS failed to correctly pay 31% of employees according to a recent report by the Treasury Inspector General for Tax Administration (TIGTA). Based on their sampling, TIGTA estimates that the IRS overpaid more than 600 employees by approximately $4.2 million and underpaid more than 900 employees by approximately $2.7 million.

The analysis was based on a sample of 4,985 IRS employees who were promoted into management positions and received pay increases that exceeded 10 percent between January 2006 and November 2015.

The IRS attributes these payment errors to complexities associated with setting pay when employees transiently move between the pay system of managerial and non-managerial roles—common to the cyclical nature of taxes. As the report notes:

“Cumbersome and confusing rules for setting pay resulted in mistakes when calculating pay for employees moving between the GS pay system and the management pay system”

These “cumbersome rules” on promotions between positions are as follows:

  • An employee selected for a first-time permanent management position is eligible for a one-time 10 percent pay increase.
  • An employee who is promoted from a management level position to another higher level management position, may receive an additional 10 percent pay increase.
  • An employee with prior management experience or selected for a temporary promotion into a management position is eligible for an 8 percent pay increase.
  • An employee who is promoted to a similar position to one they previously held may be entitled to receive increases that exceed the 10 percent and 8 percent.

 

The Inspector General’s report noted that the IRS recognized these problems existed in 2013, but failed to address them until 3 years later when The Inspector General announced their audit.

The last question that remains unresolved is whether the payment errors can be attributed to simple incompetency on the part of the IRS or malicious intent to bolster the income of some employees over that of others.

 

Photo Credit: Photo in the Public Domain, link: https://en.wikipedia.org/wiki/File:IRSlogo.png

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