Internal Revenue Service Restructuring and Reform Act of 1997

TABLE OF CONTENTS:

Title I: Executive Branch Governance and Senior Management

of the Internal Revenue Service

Subtitle A: Executive Branch Governance and Senior

Management

Subtitle B: Personnel Flexibilities

Title II: Electronic Filing

Title III: Taxpayer Protection and Rights

Title IV: Congressional Accountability for the Internal

Revenue Service

Subtitle A: Oversight

Subtitle B: Budget

Subtitle C: Tax Law Complexity

Internal Revenue Service Restructuring and Reform Act of 1997 - Title I: Executive Branch Governance and Senior Management of the Internal Revenue Service - Subtitle A: Executive Branch Government and Senior Management - Amends the Internal Revenue Code (IRC) to replace current provisions establishing the office of the Commissioner of Internal Revenue with provisions establishing the Internal Revenue Service Oversight Board (the Board). Requires that seven of the nine members of the Board not be full-time Federal officers or employees. Requires that all Board members have expertise in, among other things: (1) management of large service organizations; (2) customer service; and (3) the needs and concerns of taxpayers.

Requires the Board to: (1) review and approve strategic plans of the Internal Revenue Service (IRS); (2) review the operational functions of the IRS; (3) select the Commissioner of Internal Revenue (Commissioner), as well as senior IRS managers, and review the Commissioner's reorganization plans; and (4) review and approve the IRS budget request, as well as ensure audits of the IRS.

(Sec. 102) Replaces current provisions which authorize the Secretary of the Treasury (Secretary) to employ such personnel as necessary for the proper administration and enforcement of the internal revenue laws with provisions requiring there to be in the Department of the Treasury a Commissioner who shall be appointed by the Board for a five-year term. Sets forth the duties of the Commissioner, including the: (1) administration and management of the internal revenue laws; and (2) Commissioner's responsibility to consult with the Board.

Establishes and sets forth duties for: (1) a Chief Counsel for the IRS to be appointed by the President; (2) the Office of Employee Plans and Exempt Organizations; (3) an Office of the Taxpayer Advocate.

(Sec. 103) Replaces current provisions concerning the effect of reorganization plans with provisions which authorize the Commissioner to employ such number of persons as proper to administer and enforce the internal revenue laws.

Subtitle B: Personnel Flexibilities - Directs the Commissioner to establish a performance management system covering IRS employees which: (1) establishes retention standards; and (2) establishes performance goals or objectives. Provides for awards based on performance, but prohibits making an award solely on the basis of tax enforcement results.

Sets forth other provisions concerning: (1) classification and pay; (2) staffing; and (3) demonstration projects.

Title II: Electronic Filing - Provides for paperless filing and payment of taxes.

Title III: Taxpayer Protection and Rights - Sets forth provisions concerning taxpayer protections and rights, including provisions concerning: (1) authority to issue taxpayer assistance orders; (2) authority to award costs and fees; (3) damages for negligence in collection actions; (4) criteria and procedures for selecting taxpayers for examination; (5) archival treatment of IRS records; (6) freedom of information; (7) offers-in-compromise; (8) jurisdiction of the Tax Court; (9) cataloging of complaints; and (10) procedures for taxpayer interviews.

(Sec. 309) Eliminates the interest differential on overpayments and underpayments.

(Sec. 310) Eliminates the failure to pay penalty as long as an installment payment agreement is in effect.

(Sec. 311) Directs the Secretary to accept installment tax liability payments if: (1) such liability does not exceed $10,000; (2) the taxpayer has, during the past five years, paid on time; and (3) the taxpayer has not entered into a prior installment agreement.

(Sec. 313) Directs the Secretary to make grants to provide matching funds for qualified low-income taxpayer clinics.

(Sec. 319) Provides for studies concerning: (1) taxpayer confidentiality; (2) penalty administration; (3) treating all taxpayers as separate filing units; and (4) burden of proof.

Title IV: Congressional Accountability for the Internal Revenue Service - Subtitle A: Oversight - Authorizes the Joint Committee on Taxation (Joint Committee) to procure the services of experts for investigations of the IRS by the General Accounting Office.

(Sec. 402) Establishes additional reporting requirements for the Joint Committee.

Subtitle B: Budget - Provides for additional budget authority for the IRS, but only on annual basis and only if specified improvements are made in taxpayer services.

(Sec. 413) Directs the Commissioner to convene a financial advisory management group to advise the Commissioner.

Subtitle C: Tax Law Complexity - Expresses the sense of the Congress that the IRS should provide the Congress with an independent view of tax administration.

(Sec. 422) Requires a Senate or House of Representatives committee, when reporting legislation including any provision amending the IRC, to contain within the report a Tax Complexity Analysis.

(Sec. 423) Declares it to be the policy of the Congress that employers should have a single point of filing tax and wage reporting information.

(Sec. 424) Requires the Joint Committee to prepare a study of the feasibility of developing a baseline estimate of taxpayers' compliance burdens against which future legislative proposals could be measured.