The U.S. Senate approved a bipartisan IRS reform package September 30 that would give Oregon taxpayers clearer answers about delayed refunds, expand assistance with federal tax disputes and strengthen penalties against dishonest tax preparers.
The Taxpayer Assistance and Service Act carries 65 proposed reforms covering tax return processing, customer service, electronic filing and taxpayer protections. Oregon Sen. Ron Wyden and Idaho Sen. Mike Crapo led the legislation through the Senate Finance Committee, combining proposals to improve IRS operations and address problems taxpayers encounter when filing returns or challenging assessments.
Senate passage came by unanimous consent, with no senator objecting. The Finance Committee previously advanced the package on a 26–1 vote. Crapo chairs the committee, and Wyden serves as its ranking Democrat. The National Taxpayer Advocate also endorsed the legislation.
The measure now requires further congressional action before it can become law. Senators inserted the package into H.R. 5349, a House-originated bill. The House must approve the Senate’s version, or the chambers must settle their differences, before the legislation can reach the president.
Refund delays and incomplete information about pending returns are among the service problems addressed in the bill. Proposed upgrades to IRS tracking systems would give Oregon households and businesses more specific information about where their returns stand and what is holding up processing.
When the IRS suspends a return, the upgraded systems would identify information the agency has requested and explain how taxpayers can submit it. A public dashboard would report processing backlogs and wait times, allowing filers to check agency conditions while awaiting action on their accounts.
The package would also expand online access to tax records and correspondence. Taxpayers and authorized representatives could review more notices, letters and return documents through their accounts and submit responses to IRS inquiries electronically.
Additional provisions call for wider electronic processing of returns and correspondence. The legislation also expresses Congress’s expectation that major IRS telephone lines should offer callbacks by 2028 when calls go unanswered for more than five minutes. The language sets a service objective; it does not guarantee that an IRS representative will answer within five minutes.
The bill’s tax preparation provisions target practices that can leave customers owing money after a paid preparer files an improper return. Taxpayers can face repayment demands, interest and penalties when a preparer claims refunds or credits they are not entitled to receive.
Under the package, preparer penalties would extend to documents altered after a taxpayer signs them. The change would cover conduct such as inflating a refund claim or replacing a customer’s direct deposit information with account information that sends the refund to the preparer.
Verification requirements would also tighten for identification numbers used by paid preparers and businesses submitting returns electronically. Paid preparers without professional credentials would face suitability checks and continuing education requirements.
Exemptions would apply to attorneys, certified public accountants, enrolled agents and preparers covered by comparable state licensing programs. The IRS would gain authority to deny, suspend or revoke preparer identification numbers under specified circumstances, while preserving opportunities to appeal disciplinary decisions.
For taxpayers contesting federal tax obligations, the legislation would improve access to the IRS Independent Office of Appeals and the Taxpayer Advocate Service. It would also update federal Tax Court procedures, improve review of innocent-spouse disputes and expand support for low-income taxpayer clinics. Other provisions address unauthorized disclosure of taxpayer information.
Oregon’s existing Taxpayer Advocate Office continues to handle unresolved problems involving the state Department of Revenue. Established in 2021, the office assists residents whose concerns have not been resolved through ordinary channels and evaluates complaints about agency service.
The Senate package addresses federal tax administration. Several provisions carry implementation schedules tied to enactment, leaving the proposed service improvements and additional protections dependent on completion of the legislative process.