National Debt and Taxation Transparency Act of 2016

To provide debt and tax transparency to taxpayers. 1. Short title This Act may be cited as the National Debt and Taxation Transparency Act of 2016 2. Findings and purposes (a) Findings Congress makes the following findings: (1) United States taxpayers work on average almost 3 months of every year to pay for the operations of the Federal Government. (2) United States taxpayers spent on average 21 percent of their total income on Federal taxes in 2015. (3) In 2015, United States taxpayers spent more on taxes than on food, clothing, and housing combined. (4) The Federal Government spent the equivalent of more than $29,800 per United States household in 2015, adding nearly $4,200 per household to the Federal deficit. (5) Each household’s share of the national debt, as of January 2016, exceeds $152,000. (6) Publicly held debt is 74 percent of the gross domestic product, a level not seen since World War II. (7) Mandatory spending is growing at a faster rate than the economy. (8) Federal deficits are projected to exceed $1 trillion by 2022. (b) Purposes The purposes of this Act are— (1) to bring more transparency to the tax-and-spend habit of the Federal Government; (2) to provide for better accountability in the Federal budget and appropriations process; and (3) to increase the participation of United States citizens in their government. 3. A taxpayer financial statement to taxpayers (a) Statements initially provided upon request During the period beginning on October 1, 2017, and ending on the first date that information is made available under subsection (b), the Secretary of the Treasury (or the Secretary's delegate) shall provide to each eligible individual, upon the request of such individual, a taxpayer account statement (b) Inclusion in instructions for income tax returns In the case of individual income tax returns for taxable years beginning in calendar years after 2019, the Secretary of the Treasury (or the Secretary’s delegate) shall include a taxpayer account statement containing the information required under subsection (c) in the instructions for such tax returns. (c) Taxpayer account statement The taxpayer account statement referred to in this section shall include— (1) a summary of the most recent Financial Report of the United States Government, including the Statement of Long Term Fiscal Projections; (2) a calculation by the Secretary of the Treasury of the eligible individual’s share of the total obligations of the Federal Government, including those incurred in Medicare, Social Security, other civilian and military retirement benefit programs, publicly held debt, and any other liabilities and expenses, as reported by the most recent Financial Report of the United States Government; and (3) a 30-year calculation of the proportional increase in the Federal income tax rates, as established under chapter 1 of subtitle A of the Internal Revenue Code of 1986, necessary to entirely finance the current fiscal path of the Federal Government, assuming no changes in current fiscal policy and assuming no budget deficit. (d) Additional calculation Not later than 5 years after the date of the enactment of this Act, the Secretary shall also provide an estimate of the marginal tax rate and the income and payroll tax liability of the individual under the assumptions stated under subsection (c)(3). (e) Eligible individual For purposes of this section, the term eligible individual (1) has a valid social security number issued by the Social Security Administration; (2) received a Form W–2 in the previous taxable year; and (3) has filed a return of tax in any previous taxable year. (f) Notice The Secretary of the Treasury shall, to the maximum extent practicable, take such steps as are necessary to assure that eligible individuals are informed of the availability of the statement required under subsection (a). (g) Availability through electronic filing services It is the sense of the Congress that the Secretary of the Treasury (or the Secretary’s delegate) should partner with electronic tax filing services to make the taxpayer account statement available when an eligible individual elects to file their taxes online.

Summary: National Debt and Taxation Transparency Act of 2016 This bill directs the Department of the Treasury to provide each individual who has a valid Social Security number, who received a Form W-2 in the previous taxable year, and who has filed a tax return in any previous taxable year (eligible individual) with a taxpayer account statement. Beginning on October 1, 2017, Treasury must provide the statement to eligible individuals upon request. For individual income tax returns after 2019, Treasury must include the statement in the instructions for the returns. The taxpayer account statement shall include: (1) a summary of the most recent Financial Report of the U.S. government, including the Statement of Long Term Fiscal Projections; (2) a calculation by Treasury of the eligible individual's share of the total obligations of the federal government; and (3) a 30-year calculation of the proportional increase in the federal income tax rates necessary to entirely finance the current fiscal path of the federal government, assuming there are no changes in current fiscal policy and no budget deficit. Within five years of enactment of this bill, Treasury must also provide an estimate of the marginal tax rate and the income and payroll tax liability of the individual under the assumptions stated above.