IRS Improper Payments Act

Subjects: Taxation

Summary:  <p> <strong>IRS Improper Payments Act </strong></p> <p>This bill directs the Internal Revenue Service (IRS) to establish annual targets for reducing improper tax payments (i.e., a tax credit or refund that should not have been made or was made in an incorrect amount). The IRS must designate an official responsible for meeting such reduction targets and develop recommendations and legislative proposals designed to reduce improper tax payments.</p>

<html><body><pre>[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 1054 Introduced in Senate (IS)]

&lt;DOC&gt;






118th CONGRESS
  1st Session
                                S. 1054

 To reduce improper payments and eliminate waste in Federal programs, 
                        and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 29, 2023

   Mr. Braun introduced the following bill; which was read twice and 
referred to the Committee on Homeland Security and Governmental Affairs

_______________________________________________________________________

                                 A BILL


 
 To reduce improper payments and eliminate waste in Federal programs, 
                        and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``IRS Improper Payments Act''.

SEC. 2. FINDINGS AND PURPOSE.

    (a) Findings.--Congress finds that when the Internal Revenue 
Service makes payments to taxpayers, the Internal Revenue Services must 
make every effort to confirm that the right recipient is receiving the 
right payment for the right reason at the right time.
    (b) Purpose.--The purpose of this Act is to--
            (1) reduce improper tax payments by the Internal Revenue 
        Service--
                    (A) by intensifying efforts to eliminate payment 
                error, waste, fraud, and abuse; and
                    (B) by continuing to ensure that the Internal 
                Revenue Service provides accessible taxpayer services;
            (2) adopt a comprehensive set of policies, including--
                    (A) transparency of significant improper tax 
                payments; and
                    (B) accountability for reducing improper tax 
                payments; and
            (3) protect taxpayer services.

SEC. 3. IMPROPER TAX PAYMENT DEFINED.

    For purposes of this Act, the term ``improper tax payment'' means 
any credit or refund of an overpayment of a tax imposed under the 
Internal Revenue Code of 1986 that should not have been made or that 
was made in an incorrect amount.

SEC. 4. TRANSPARENCY.

    (a) In General.--Not later than 90 days after the date of enactment 
of this section, the Secretary of the Treasury shall establish, in 
coordination with the Commissioner of Internal Revenue, annual targets 
for reducing improper tax payments made by the Internal Revenue 
Service.
    (b) Published Information.--
            (1) In general.--Not later than 180 days after the date of 
        enactment of this section, and annually thereafter, the 
        Secretary of the Treasury shall publish on the internet 
        information about improper tax payments made by the Internal 
        Revenue Service.
            (2) Contents.--The information published under paragraph 
        (1) shall include, subject to Federal privacy policies and to 
        the extent permitted by law--
                    (A) the name of the accountable official designated 
                under section 5(a);
                    (B) rates and amounts as of the date of enactment 
                of this section, and historical rates and amounts, of 
                improper tax payments made by the Internal Revenue 
                Service, including, if known and appropriate, the 
                causes of the improper tax payments;
                    (C) rates and amounts as of the date of enactment 
                of this section, and historical rates and amounts, of 
                the recovery of improper tax payments (estimated on the 
                basis of applicable samples where appropriate); and
                    (D) the annual targets for reducing improper tax 
                payments.
    (c) Methodology.--The methodology used for identifying and 
measuring improper tax payments under this section shall meet the 
requirement of section 3352(c)(1)(A) of title 31, United States Code.
    (d) Links.--The Commissioner of Internal Revenue shall prominently 
display on the homepage of the website of the Internal Revenue Service 
a link to internet-based resources for addressing improper tax 
payments, including the information published under subsection (b)(1).

SEC. 5. ACCOUNTABILITY AND COORDINATION.

    (a) Accountable Officials.--Not later than 120 days after the date 
of enactment of this section, the Commissioner of Internal Revenue 
shall designate an official to be accountable for meeting the reduction 
targets under section 4(a) without unduly burdening taxpayer services.
    (b) Report.--
            (1) In general.--Not later than 180 days after the date of 
        enactment of this section, and annually thereafter, the 
        official who is designated under subsection (a) shall provide 
        the Director of the Office of Management and Budget and the 
        appropriate congressional committees a report that includes--
                    (A) the methodology used for identifying and 
                measuring improper tax payments under section 4(c);
                    (B) the plans for meeting the reduction targets 
                under section 4(a); and
                    (C) the plans and supporting analysis for ensuring 
                that initiatives undertaken in accordance with this 
                title do not unduly burden taxpayer services.
            (2) Appropriate congressional committees.--For purposes of 
        paragraph (1), the term ``appropriate congressional 
        committees'' means the Committee on Finance of the Senate and 
        the Committee on Ways and Means of the House of 
        Representatives.
    (c) Duties of Inspector General.--Not later than 60 days after the 
date on which the annual report required under subsection (b) is 
submitted, the Treasury Inspector General for Tax Administration 
shall--
            (1) assess the level of risk for improper tax payments by 
        the Internal Revenue Service;
            (2) determine the extent of oversight warranted (in 
        addition to oversight requirements under section 3353 of title 
        31, United States Code); and
            (3) provide the Commissioner of Internal Revenue with 
        recommendations, if any, for modifying the methodology, 
        improper tax payment reduction plans, or taxpayer services.
    (d) Agency Failure.--
            (1) In general.--If the Internal Revenue Service does not 
        demonstrate an improvement in reducing improper tax payments, 
        fails to develop a plan to meet reduction targets under 
        subsection (b)(1)(B), or fails to implement the plans described 
        in subsection (b)(1)(C) for not less than 2 consecutive years, 
        the official designated under subsection (a) shall submit to 
        the Commissioner of Internal Revenue, the Treasury Inspector 
        General for Tax Administration, and the Chief Financial Officer 
        of the Internal Revenue Service a report that--
                    (A) describe the likely causes of the lack or 
                improvement or failure; and
                    (B) proposes a remedial plan.
            (2) Review.--Annually, the Commissioner of Internal Revenue 
        shall, with respect to a remedial plan proposed under paragraph 
        (1)(B)--
                    (A) review the remedial plan; and
                    (B) in consultation with the Treasury Inspector 
                General for Tax Administration and Chief Financial 
                Officer of the Internal Revenue Service, forward the 
                remedial plan and any additional comments and analysis 
                to the Director of the Office of Management and Budget.

SEC. 6. POLICY PROPOSALS.

    (a) In General.--Not later than 180 days after the date of 
enactment of this section, the Secretary of the Treasury, in 
consultation with the Commissioner of Internal Revenue and the Treasury 
Inspector General for Tax Administration, shall develop policy 
recommendations, including potential legislative proposals, designed to 
reduce improper tax payments, including improper tax payments caused by 
error, waste, fraud, and abuse, made by the Internal Revenue Service.
    (b) Inclusion.--The recommendations developed under subsection (a) 
shall be included, as appropriate, in the budget of the President under 
section 1105(a) of title 31, United States Code, for fiscal year 2024 
and each fiscal year thereafter.
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