To require the Internal Revenue Service to issue a report on the tax gap, to establish a fellowship program within the Internal Revenue Service to recruit mid-career tax professionals to create and participate in an audit task force, and for other purposes.
12/31/2022, 9:00 AMSummary of Bill HR 5206
Bill 117 hr 5206, also known as the Tax Gap Report and Audit Task Force Act, aims to address the issue of tax evasion and non-compliance by requiring the Internal Revenue Service (IRS) to issue a report on the tax gap. The tax gap refers to the difference between the amount of taxes owed to the government and the amount actually paid.In addition to the report, the bill also establishes a fellowship program within the IRS to recruit mid-career tax professionals. These professionals will be tasked with creating and participating in an audit task force, which will focus on identifying and addressing instances of tax evasion and non-compliance.
The goal of the bill is to improve tax enforcement efforts and ensure that all individuals and businesses are paying their fair share of taxes. By recruiting experienced tax professionals and creating a specialized audit task force, the IRS will be better equipped to identify and address instances of tax evasion, ultimately reducing the tax gap and increasing government revenue. Overall, the Tax Gap Report and Audit Task Force Act seeks to strengthen tax enforcement measures and promote compliance with tax laws, ultimately benefiting the economy and ensuring a more equitable tax system for all Americans.
Congressional Summary of HR 5206
This bill requires the Internal Revenue Service (IRS) to report to Congress on projections of the estimated tax gap (i.e., the difference between tax liabilities owed to the IRS and those liabilities that the IRS actually collects). The IRS may use artificial intelligence and related data analysis tools to calculate a tax gap projection. The bill also requires the Joint Committee on Taxation to issue periodic reports to the congressional tax committees on the tax gap projection.
The bill restricts IRS funding to FY2021 levels for audits and enforcement until it publishes an updated tax gap projection. Funding is also restricted for certain purposes, including (1) targeting U.S. citizens who exercise their First Amendment rights, (2) targeting a group for regulatory scrutiny based on its ideological beliefs, and (3) auditing individual taxpayers with an adjusted gross income of less than $400,000.
The bill directs the IRS to establish a fellowship program to recruit private sector tax experts to join the IRS to create and participate in the audit task force. The purposes of the tax force include performing audit case selection, educating IRS employees on emerging issues, auditing selected taxpayers, addressing offshore tax evasion, and identifying, mentoring, and training IRS junior employees with respect to audits.
