What This Bill Does
This bill requires the IRS and Treasury Department to create detailed spending plans before they can use certain funding they received. Congress can reject these plans, which would pause the use of that money. The bill also requires regular reports to Congress about how the money is being spent.
##
Who It Affects
- The Internal Revenue Service (the federal agency that collects taxes)
- The Treasury Department (the federal agency that manages government money)
- Congress (which receives and reviews the spending plans)
- Taxpayers (whose tax dollars fund the IRS)
##
Key Provisions
- The IRS Commissioner must submit a spending plan within 60 days of this law passing, explaining how funds will be used over the next five years (Sec. 2(b)(1)(A))
- Congress can pass a joint resolution of disapproval (a formal vote of rejection) within 60 days of receiving a spending plan, which would require a new plan to be submitted (Sec. 2(c))
- The spending plan must detail costs, timelines, goals, and performance measures for IRS improvements in customer service, tax collection, technology, cybersecurity, and data protection (Sec. 2(b)(2)(B)(i))
- The IRS Commissioner must submit quarterly reports every 14 days after the end of each three-month period describing how funds were spent and new employees hired (Sec. 3(a)(1))
- The Treasury Secretary must also submit quarterly reports describing Treasury Department spending and any new initiatives using these funds (Sec. 3(b)(1))
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What Changes
If this becomes law, the IRS cannot immediately use certain appropriated funds. Instead, it must first create a detailed spending plan for Congress's review. Congress has 60 days to formally disapprove the plan. If Congress disapproves it, the IRS must create a new plan and Congress gets another 60 days to review it.
The IRS and Treasury must also provide quarterly progress reports to Congress listing specific actions taken, money spent by division, new hires, and employee security clearance status.
If the IRS or Treasury fail to submit required reports on time, their funding gets reduced by a set amount per day late.
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Important Definitions
- **Joint resolution of disapproval**: A formal Congressional vote rejecting the IRS spending plan (Sec. 2(c)(1))
- **Applicable period**: The time from after the initial spending plan is due through September 30, 2031 (Sec. 3(c)(1))
- **Taxpayer return information**: Not specified in bill text
- **Appropriate Congressional committees**: The Senate Finance Committee, Senate Appropriations Committee, House Ways and Means Committee, and House Appropriations Committee (Sec. 4)
##
Effective Date
Not specified in bill text
II
118TH CONGRESS
1ST SESSION
S. 338
To provide accountability for funding provided to the Internal Revenue Service
and the Department of Treasury under Public Law 117–169.
IN THE SENATE OF THE UNITED STATES
FEBRUARY 9, 2023
Mr. THUNE (for himself, Mr. GRASSLEY, Mr. BARRASSO, Mrs. BLACKBURN,
Mr. CASSIDY, Mr. CORNYN, Mr. CRAPO, Mr. DAINES, Mr. JOHNSON, Mr.
LANKFORD, Mr. SCOTT of South Carolina, Mr. TILLIS, and Mr. YOUNG)
introduced the following bill; which was read twice and referred to the
Committee on Finance
A BILL
To provide accountability for funding provided to the Internal
Revenue Service and the Department of Treasury under
Public Law 117–169.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE.
3
This Act may be cited as the ‘‘IRS Funding Account-
4
ability Act’’.
5
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•S 338 IS
SEC. 2. ANNUAL COMPREHENSIVE SPENDING PLAN FOR IN-
1
CREASED INTERNAL REVENUE SERVICE RE-
2
SOURCES.
3
(a) LIMITATION ON FUNDING.—
4
(1) INITIAL PLAN.—
5
(A) IN GENERAL.—None of the funds de-
6
scribed in paragraph (3) may be obligated dur-
7
ing the period—
8
(i) beginning on the date of the enact-
9
ment of this Act; and
10
(ii) ending on the date that is 60 days
11
after the spending plan described in sub-
12
section (b)(1)(A) has been submitted.
13
(B) ADDITIONAL
MORATORIUM.—If Con-
14
gress enacts a joint resolution of disapproval
15
described in subsection (c) with respect to the
16
Internal Revenue Service spending plan before
17
the date described in subparagraph (A)(ii),
18
then—
19
(i) the Commissioner of Internal Rev-
20
enue shall submit a new spending plan
21
under subsection (b)(1)(A); and
22
(ii) the period described in subpara-
23
graph (A) shall not end before the date
24
that is 60 days after such new spending
25
plan is submitted.
26
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(2) SUBSEQUENT SUBMISSIONS.—
1
(A) IN GENERAL.—None of the funds de-
2
scribed in paragraph (3) may be obligated dur-
3
ing any period—
4
(i) beginning on the date Congress
5
has enacted a joint resolution of dis-
6
approval under subsection (c) with respect
7
to any spending plan described in sub-
8
section (b)(1)(B); and
9
(ii) ending on the date that is 60 days
10
after the date on which the Commissioner
11
of Internal Revenue has submitted a new
12
spending plan under such subsection.
13
(B) ADDITIONAL
MORATORIUM.—If Con-
14
gress enacts a joint resolution of disapproval
15
described in subsection (c) with respect to any
16
new spending plan submitted under subpara-
17
graph (A)(ii) before the date that is 60 days
18
after the date on which such new spending plan
19
has been submitted, then—
20
(i) the Commissioner of Internal Rev-
21
enue shall submit an additional new spend-
22
ing plan under subsection (b)(1)(B); and
23
(ii) the period described in subpara-
24
graph (A) shall not end before the date
25
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that is 60 days after such additional new
1
spending plan is submitted.
2
(3) FUNDS DESCRIBED.—The funds described
3
in this paragraph are the following:
4
(A) Any funds made available under clause
5
(ii), (iii), or (iv) of section 10301(1)(A) of Pub-
6
lic Law 117–169.
7
(B) Any funds made available under sec-
8
tion 10301(1)(A)(i) of Public Law 117–169
9
other than funds used for the following pur-
10
poses:
11
(i) Eliminating any correspondence or
12
return processing backlog.
13
(ii) Reducing call wait times for tax-
14
payers and tax professionals.
15
(b) ANNUAL COMPREHENSIVE SPENDING PLAN.—
16
(1) IN GENERAL.—
17
(A) INITIAL
PLAN.—Not later than 60
18
days after the date of the enactment of this
19
Act, the Commissioner of Internal Revenue
20
shall submit to the appropriate Congressional
21
committees a spending plan described in para-
22
graph (2).
23
(B) SUBSEQUENT SUBMISSIONS.—
24
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(i) IN GENERAL.—For each fiscal year
1
beginning after the plan described in sub-
2
paragraph (A) is submitted and ending
3
with fiscal year 2031, the Commissioner of
4
Internal Revenue shall submit to the ap-
5
propriate
Congressional
committees
a
6
spending plan described in paragraph (2)
7
on the date that the President submits the
8
budget required under section 1105(a) of
9
title 31, United States Code.
10
(ii) REDUCTION IN APPROPRIATION.—
11
(I) IN GENERAL.—In the case of
12
any failure to submit a plan required
13
under clause (i) by the date that is 7
14
days after the date the plan is re-
15
quired to be submitted and, the
16
amounts made available under section
17
10301(1)(A)(ii) of Public Law 117–
18
169 shall be reduced by $10,000,000
19
for each day after such required date
20
that report has not been submitted.
21
(II) REQUIRED DATE.—For pur-
22
poses of this clause, the term ‘‘re-
23
quired date’’ means, with respect to
24
any plan required under this subpara-
25
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•S 338 IS
graph, the date that is 7 days after
1
such plan is required to be submitted.
2
(2) SPENDING PLAN.—
3
(A) IN
GENERAL.—A spending plan de-
4
scribed in this subparagraph is a plan that—
5
(i) details how the funds appropriated
6
under section 10301(1) of Public Law
7
117–169 will be spent over—
8
(I) the period consisting of the
9
current fiscal year and the next 4 fis-
10
cal years ending before fiscal year
11
2032; and
12
(II) the period of consisting of
13
the current fiscal year through the fis-
14
cal year ending with fiscal year 2031
15
(if such period includes any period not
16
described in subclause (I));
17
(ii) contains the information described
18
in subparagraph (B);
19
(iii) has been reviewed by—
20
(I) the Internal Revenue Service
21
Advisory Council;
22
(II)
the
Comptroller
of
the
23
United States;
24
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•S 338 IS
(III) the National Taxpayer Ad-
1
vocate; and
2
(IV) the Director of the Office of
3
Management and Budget; and
4
(iv) has been approved by the Director
5
of the Office of Management and Budget.
6
(B) PLAN
CONTENTS.—The information
7
described in this paragraph is the following:
8
(i) A detailed explanation of the plan,
9
including—
10
(I) costs and results to date, ac-
11
tual expenditures of the prior fiscal
12
year, actual and expected expenditures
13
of the current fiscal year, upcoming
14
deliverables and expected costs, and
15
total expenditures;
16
(II) clearly defined objectives,
17
timelines, and metrics for quan-
18
titatively measuring the plan’s annual
19
progress, including with respect to
20
measuring improvements in taxpayer
21
services, revenue collection, informa-
22
tion technology, cybersecurity, and
23
taxpayer data protections; and
24
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•S 338 IS
(III) a description of any dif-
1
ferences between metrics described in
2
subclause
(II)
and
corresponding
3
metrics used by the National Tax-
4
payer Advocate, the Comptroller Gen-
5
eral of the United States, and Treas-
6
ury Inspector General for Tax Admin-
7
istration.
8
(ii) A detailed analysis of the perform-
9
ance of the Internal Revenue Service with
10
respect to the delivery of taxpayer services,
11
including—
12
(I) the Level of Service (LOS) of
13
phone lines (as a percent of phone
14
calls answered by an Internal Revenue
15
Service employee, not to include cour-
16
tesy disconnects or automated call
17
backs);
18
(II) the median and average wait
19
time to speak to a representative of
20
the Internal Revenue Service;
21
(III) the amount of unprocessed
22
taxpayer
correspondence,
including
23
tax returns, responses to Internal
24
Revenue Service notices, tax pay-
25
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•S 338 IS
ments, and other similar types of cor-
1
respondence; and
2
(IV) the median and average
3
length of time for processing the
4
items described in subclause (III) and
5
processing refund claims.
6
(iii) An analysis identifying any in-
7
crease or decrease in total annual audits
8
and annual audit rates by income group
9
for the period beginning in 2018 and end-
10
ing with the year the report is submitted.
11
Such analysis shall include a detailed de-
12
scription of what constitutes an ‘‘audit’’ by
13
the Internal Revenue Service, and if the
14
definition of an ‘‘audit’’ used by the Inter-
15
nal Revenue Service differs from the defi-
16
nition used by the National Taxpayer Ad-
17
vocate, the Comptroller General of the
18
United States, or the Treasury Inspector
19
General for Tax Administration, there
20
shall also be included an analysis using
21
such divergent definition.
22
(iv) A categorizing of the number of
23
audits for each year in the analysis de-
24
scribed in clause (iv) which were—
25
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•S 338 IS
(I) correspondence audits;
1
(II) office audits;
2
(III) field audits;
3
(IV) audits under the Internal
4
Revenue Service National Research
5
Program; and
6
(V) other audits.
7
(v) A description of all taxpayer com-
8
pliance actions or initiatives undertaken
9
using funding appropriated under section
10
10301(1)(A) of Public Law 117–169 that
11
do not rise to the level of an audit, with
12
each action broken out by the total number
13
of such actions undertaken for each income
14
group and as a percentage of taxpayers in
15
each income group.
16
(vi) An explanation of any unresolved
17
or outstanding recommendations made by
18
the Government Accountability Office and
19
Treasury Inspector General for Tax Ad-
20
ministration pertaining to taxpayer-data
21
privacy protections, Internal Revenue Serv-
22
ice taxpayer services, and Internal Revenue
23
Service technology modernization efforts
24
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•S 338 IS
that are addressed by the plan and a de-
1
scription of how they are addressed.
2
(vii) For any recommendations identi-
3
fied by Government Accountability Office
4
and Treasury Inspector General for Tax
5
Administration as ‘‘high risk’’ or ‘‘pri-
6
ority’’ that are not addressed in the plan,
7
an explanation of why such recommenda-
8
tions are not addressed in the plan.
9
(3) TESTIMONY OF RELEVANT OFFICIALS.—Not
10
later than 30 days after any spending plan described
11
in paragraph (2) has been submitted, the Secretary
12
of the Treasury and the Commissioner of Internal
13
Revenue shall testify in person before any of the ap-
14
propriate Congressional committees that request
15
their testimony with respect to such spending plan.
16
(4) REQUIREMENT
TO
NOTIFY
OF
EXCESS
17
SPENDING.—The Commissioner of Internal Revenue
18
shall immediately notify the appropriate Congres-
19
sional committees if actual obligations and expendi-
20
tures for any account for any period for which pro-
21
jections are made in a plan submitted under para-
22
graph (2) exceed the amount of obligations and ex-
23
penditures projected for such account in such plan
24
by 5 percent or more.
25
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•S 338 IS
(c) JOINT RESOLUTION OF DISAPPROVAL OF THE
1
IRS COMPREHENSIVE SPENDING PLAN.—
2
(1) IN GENERAL.—For purposes of this section,
3
the term ‘‘joint resolution of disapproval of the IRS
4
comprehensive spending plan’’ means only a joint
5
resolution introduced in the period beginning on the
6
date on which a spending plan submitted pursuant
7
to subsection (b)(1)(A) is received by the appro-
8
priate Congressional committees and ending 60 days
9
thereafter (excluding days either House of Congress
10
is adjourned for more than 3 days during a session
11
of Congress), the matter after the resolving clause of
12
which is as follows: ‘‘That Congress disapproves the
13
plan submitted on llll by the Internal Rev-
14
enue Service relating to the comprehensive spending
15
plan under section 2(b)(1) of the IRS Funding Ac-
16
countability Act with respect to fiscal year lll.’’.
17
(The blank spaces being appropriately filled in).
18
(2) APPLICATION OF CONGRESSIONAL REVIEW
19
ACT DISAPPROVAL PROCEDURES.—
20
(A) IN
GENERAL.—The rules of section
21
802 of title 5, United States Code, shall apply
22
to a joint resolution of disapproval of the IRS
23
comprehensive spending plan in the same man-
24
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•S 338 IS
ner as such rules apply to a joint resolution de-
1
scribed in subsection (a) of such section.
2
(B) EXERCISE OF RULEMAKING AUTHOR-
3
ITY.—This section is enacted by Congress—
4
(i) as an exercise of the rulemaking
5
power of the Senate and House of Rep-
6
resentatives, respectively, and as such it is
7
deemed a part of the rules of each House,
8
respectively, but applicable only with re-
9
spect to the procedure to be followed in
10
that House in the case of a joint resolution
11
of disapproval of the IRS comprehensive
12
spending plan described in paragraph (1),
13
and it supersedes other rules only to the
14
extent that it is inconsistent with such
15
rules; and
16
(ii) with full recognition of the con-
17
stitutional right of either House to change
18
the rules (so far as relating to the proce-
19
dure of that House) at any time, in the
20
same manner, and to the same extent as in
21
the case of any other rule of that House.
22
SEC. 3. QUARTERLY REPORTS.
23
(a) INTERNAL REVENUE SERVICE.—
24
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[Text truncated for display. Full text available on Congress.gov.]