Tax filing, payment processes simplified under recently proposed congressional bill

A bipartisan bill that would amend the Internal Revenue Code of 1986 to make improvements related to tax administration is under consideration by the tax-writing U.S. House Ways and Means Committee.

The Tax Administration Simplification Act, H.R. 8864, builds off of recommendations from the National Taxpayer Advocate and previous legislation to simplify the tax filing and payment processes for American workers and small businesses, said U.S. Rep. Darin LaHood (R-IL), who sponsored H.R. 8864.

“As the Ways and Means Committee works to strengthen our tax code, it is important that we improve taxpayer rights and the administrative process to reduce burdensome filing challenges,” LaHood said after introducing the bill last month. “I am proud to lead this bipartisan effort and look forward to working with my Ways and Means colleagues to streamline the tax filing process.”

LaHood was joined in unveiling the bill by six cosponsors: U.S. Reps. Brad Schneider (D-IL), Randy Feenstra (R-IA), Suzan DelBene (D-WA), Brian Fitzpatrick (R-PA), Jimmy Panetta (D-CA), and Debbie Lesko (R-AZ).

If enacted, the legislation would apply the so-called mailbox rule to documents and payments electronically submitted to the IRS.

Under current law, if taxpayers submit payments or documents to the IRS electronically on the due date, but they are received and processed the next day, then they would be considered late.

The Tax Administration Simplification Act would make changes to the law to provide for documents and payments submitted electronically to be considered made on the date submitted, even if they are not received or reviewed until a later date, according to a bill summary provided by the lawmakers.

The measure also would extend the time for making S Corporation elections by allowing taxpayers to elect S Corporation status on their first timely filed income tax return.

Among other provisions, the bill also would revise estimated income tax payment deadlines by changing them to actually fall on a quarterly basis and make it easier for taxpayers to calculate their net income, the summary says.

“As an advocate for tax reform, I’m focused on lowering taxes for our families and small businesses and helping Iowans and business owners more easily file their taxes,” said Feenstra on July 19. “This legislation will help eliminate headaches when filing taxes so that entrepreneurs and taxpayers can focus on delivering exceptional service to their customers and caring for their families.”

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