Requiring the IRS to Provide Information on the Status of Investigations (H.R. 5420)

What is H.R. 5420?

(Updated July 18, 2017)

 H.R. 5420 amends the Internal Revenue Code of 1986 to allow the IRS to release the status on its investigations to people who report violations to the Secretary.

If passed, the bill would allow the IRS to release information to individuals who filed complaints regarding:

• Whether or not an investigation has been launched into the individual or group that was reported,
• Whether or not the violation reported was found to be true,
• Whether or not any penalty has been issued against the violating individual.

Argument in favor

People have the right to know when the IRS has responded to a complaint regarding reported tax violations.

Argument opposed

The IRS should protect the privacy of individuals under investigation. Sharing information prior to closing could damage the quality of investigations.

Impact

People who report tax violators to the IRS, those people who are being reported on, and the IRS.

Cost of H.R. 5420

A CBO cost estimate is unavailable.

Additional Info

In-Depth:

OK, so, imagine if you found out your ex-partner was guilty of major tax violations and you reported him or her to the IRS. Now imagine what it’d feel like if you never heard back from the IRS after your report.

That’s the dynamic that is currently in place because the IRS is not permitted to share information regarding investigations into individuals following complaints. Introduced by Rep. Charles Boustany (R-LA), H.R. 5420 would allow for the release of information to individuals who issue complaints in certain investigations.

(Photo credit: Flickr user Images_of_Money)