Number: 116-1
Date: April 30, 2019 

House Passes H.R. 1957, the
“Taxpayers First Act of 2019”

On April 9, 2019, the House amended and passed, H.R. 1957, the Taxpayers First Act of 2019, by voice vote, under suspension of the rules.  The bill, among other things, would require the Internal Revenue Service (IRS) to notify individuals of employment-related identity theft, and the Social Security Administration (SSA) as necessary, to request annually such IRS employment-based identity theft information.  Additionally, it would authorize IRS to lower the electronic wage reporting threshold.  This bill now moves to the full Senate for consideration.1
   
H.R. 1957 includes the following provisions of interest to SSA:

Section 1205. Private Debt Collection and Special Compliance Personnel Program

  • Would prevent the Secretary of the Treasury (the Secretary) from entering into qualified tax collection contracts2 to collect inactive tax receivables3 from individuals whose income consists substantially of SSA disability and Supplemental Security Income.

Section 2005. Identity Protection Personal Identification Numbers

  • Would require the Secretary, upon request from any individual, to issue a number that may be used in conjunction with the individual’s Social Security Number (SSN) (or other identifying information for the individual, as determined by the Secretary) to assist the Secretary in verifying the individual’s identity. 
  • Would be effective for each calendar year after the date of enactment to individuals residing in such States as the Secretary determines appropriate, with national availability to all individuals residing in the United States no later than 5 years after the date of enactment.

Section 2006. Single Point of Contact for Tax-Related Identity Theft Victims

  • Would require the Secretary to establish and implement procedures for a single point of contact at IRS for any individual whose tax return was delayed or otherwise adversely affected due to tax-related identity theft. 

Section 2007. Notification of Suspected Identity Theft

  • Would require the Secretary to notify individuals who have or may have been victims of employment-related identity theft.  Such notification would include instructions on how to file a report with law enforcement and whether the Secretary has initiated an investigation, among other things. 
  • Would require the Secretary to review tax information (e.g., statements, tax returns), including wage reports provided to IRS by SSA, to determine whether employment-related identity theft may have occurred. Such information would indicate that the SSN provided on the wage report or tax return does not correspond with the name on either the 1) wage report or 2) tax return.
  • Would amend section 232 of the Social Security Act to require the Commissioner of Social Security to request, at least annually, employment-related identity theft information from the IRS as may be necessary to ensure the accuracy of wage records maintained by SSA.
  • Would apply to employment-related identity theft determinations made by the Secretary 6 months after enactment. 

Section 2102. Internet Platform for Form 1099 Filings

  • Would require the Secretary, no later than January 1, 2023, to develop a website or other electronic media for filing 1099s, similar to functionality of SSA’s Business Services Online.

Section 2201.  Disclosure of Taxpayer Information for Third-Party Income Verification

  • Would require the Secretary to create an electronic, consent-based income verification system for its disclosures.    
  • The effective date would be no later than 1 year after the close of the 2-year period that beings on the first day of the 6th month after enactment. 

Section 2301. Electronic Filing of Returns

  • Would authorize (but not require) the IRS to lower its threshold for the electronic filing of returns, including information returns such as Form W-2.  Under current law, IRS cannot require a person or employer to file returns electronically unless the person or employer files at least 250 returns each year.  This provision would allow the IRS to lower this threshold from 250 to 100 in 2021, and from 100 to 10 beginning 2022.

Effective Date

  • Except as otherwise provided above, the provisions in this Act are effective upon enactment.

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1 Senator Grassley (R-IA) introduced S. 928, a companion bill on March 28, 2019.

2 Qualified tax collection contract is further defined in 26 USC 6306 (b).

3 Inactive tax receivable is further defined in 26 USC 6306(c)(2)(A).