IRS Reform Bill Passes House

The House Tuesday passed by voice vote The Taxpayer First Act pf 2019 (H.R. 1957) that would make some structural changes to the Internal Revenue Service (IRS) and change the agency's interactions with taxpayers. Some of the provisions could impact certain credit unions. 

A similar bill passed the House during the last Congress but was never taken up by the Senate. Senate Finance Chairman Chuck Grassley (R-Iowa) has indicated that he plans to advance the current measure.

H.R. 1957 would:

  • Make changes to the IRS' seizure or forfeiture of assets related to the Bank Secrecy Act (BSA) and cash structuring;
  • Allow direct payment of federal taxes by debit and credit cards though consumers would still be subject to a surcharge for the associated fees;
  • Require the IRS to conduct a study and report to Congress ways to increase the number of tax refunds paid by electronic fund transfers (EFTs);
  • Require creation of a Web site for taxpayers to file Form 1099 and require covered organizations to electronically file Form 990; and
  • Require the IRS to send a notice to an organization if it did not file Form 990 for two consecutive years (tax-exempt status is revoked if an organization fails to file the form for three consecutive years).

The bill does not address the 21 percent excise tax on excess executive compensation implemented under the Tax Cuts and Jobs Act (TCJA) which is of concern to some credit unions.