IRS Tax Mistake Bill Passes US House in ‘Win for Taxpayers’
Newsweek, Jasmine Laws, 41/25
The U.S. House of Representatives has passed a bill, which received bipartisan support, that seeks to make the Internal Revenue Service’s (IRS) handling of tax return errors more transparent.
Newsweek has contacted Iowa Republican Representative Randy Feenstra, who introduced the bill, out of normal working hours via email for comment.
Why It Matters
Taxpayers who receive an IRS notice of a math or clerical error face a process that critics describe as opaque and difficult to navigate. The IRS is allowed to adjust tax liabilities without initiating an audit, and can send automated letters that often lack detail and can result in unexpected bills or reductions in refunds.
Supporters of the proposed legislation say it addresses a long-standing gap in taxpayer communication, as the bill seeks to reduce confusion, prevent unnecessary financial strain, and give taxpayers the tools to understand and challenge changes made to their filings.
What To Know
In February, Feenstra introduced H.R. 998, the Internal Revenue Service Math and Taxpayer Help Act, which has cleared the lower chamber unanimously and awaits Senate consideration.
The legislation is designed to ensure that the IRS provides clearer explanations when it identifies math or clerical errors in tax filings.
The bill requires that each IRS notice include specific information about the error and what steps the taxpayer can take in response.
The notices must describe the type of error in “plain language” and identify the specific line on the tax return that was affected.
They must also include an itemized breakdown of how the IRS recalculated the return, giving taxpayers a transparent view of how any adjustments were made.
Notices will now feature a dedicated phone number for the IRS’ automated transcript service and must state the deadline by which a taxpayer can request an abatement, essentially a reversal, of the tax changes.
The bill outlines that such abatement requests can be submitted by mail, electronically, over the phone or in person.
Additionally, if the IRS later makes changes that reduce the assessment tied to a previous error, it must send a follow-up notice that explains the abatement with the same level of detail as the original notice.
The bill received support from both parties in the House, with no recorded opposition in the floor vote or committee hearings.
What People Are Saying
Iowa Republican Representative Randy Feenstra said: “If the IRS finds a mistake on a tax return—for example, when a taxpayer accidentally adds a zero to their reported income—the agency should clearly communicate that error to the taxpayer and explain why a tax refund is different than expected(…)
“With this legislative fix, we can improve customer service by promoting open and transparent communication between the IRS and the taxpayer when a tax error is identified.”
Missouri Republican Representative Jason Smith, chairman of the House Ways and Means Committee, said: “This bill is a win for taxpayers that will deliver better protection for Americans and greater accountability to the IRS.”
Ryan J. Wilson, professor of accounting at the Tippie College of Business in Iowa, told Newsweek: “This seems like a positive for taxpayers. Certainly, IRS communication can be vague and confusing. Taking steps to enhance clarity around clerical errors and recalculated returns is helpful. I also like the idea of providing a number for taxpayers to call.”
He added: “I am not sure this bill will have a big impact on Iowans, but it does seem like it will make life easier in the event these recalculations do occur.”
What Happens Next
Having cleared the House, H.R. 998 now moves to the Senate. If passed, the bill would proceed to the president for his signature.