WASHINGTON DC -Oversight Subcommittee Chairman John Lewis (D-GA) is today applauding many proposals in the Administration’s budget that would make critical improvements to the tax system.
“The Oversight Subcommittee looks forward to examining the Administration’s budget for the IRS in the upcoming months," said Subcommittee Chairman Lewis. “I am pleased that the President’s budget includes proposals I have worked on with my colleagues-making it easier for citizens who are struggling to pay their taxes to make payment agreements with the IRS, modernizing current rules applied to employer-provided cell phones, and expanding a State’s ability to collect delinquent taxes."
Modernizes Employer-Provided Cell Phone Requirements
The Administration proposes to remove the strict substantiation rules on cell phones, which only allow employers deductions for employer-provided cell phones if employees keep detailed, written records about the use of the phone. Any usage not substantiated by written records, and any personal use, are taxable to the employee. Given the modern use of cell phones (and similar devices), the Administration proposes to remove the strict substantiation requirements, which would allow employers to deduct, and employees to exclude from income, the use of cell phones (and similar devices) provided primarily for business purposes. This proposal passed the House in the 110th Congress, in H.R. 5719 (Taxpayer Assistance and Simplification Act of 2008). A bipartisan bill also was introduced in the 111th Congress, in H.R. 690 (Modernize Our Bookkeeping In the Law for Employee's Cell Phone Act of 2009).
On June 17, 2009, Chairman Lewis and Rep. Earl Pomeroy (D-ND), a senior Member of the Ways and Means Committee, applauded Internal Revenue Service (IRS) Commissioner Douglas H. Shulman for his efforts to address a law.
Revises Offer-in-Compromise Application Rules to Assist Struggling Taxpayers
The Administration proposes to remove the nonrefundable, down payment requirement for taxpayers offering to settle their unpaid taxes by submitting an offer-in-compromise (OIC) application. OIC agreements are an important collection alternative for the IRS and taxpayers. In this economy, many taxpayers seeking to enter into OIC agreements have recently lost jobs or are experiencing financial difficulties
On May 12, 2009, Chairman Lewis and Oversight Subcommittee Ranking Member Charles W. Boustany, Jr. (R-LA), introduced H.R. 2343, the Tax Compromise Improvement Act of 2009, which would remove this requirement.
Expands States’ Ability to Collect Delinquent Taxes
The Administration proposes to remove the restriction that allows offsets to Federal tax refunds for delinquent State income tax only if the taxpayer resides in the State seeking the offset. On May 7, 2009, Chairman Lewis introduced H.R. 2303, the State Tax Administration Assistance Act of 2009, to remove this same-State restriction, which would allow States to collect unpaid State income taxes from nonresidents under the program.
