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Ways and Means Votes Against Private Tax Collectors Ways and Means Votes Against Private Tax Collectors

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Ways and Means Votes Against Private Tax Collectors

WASHINGTON (April 9, 2008) - The House Ways and Means Committee approved a tax code streamlining bill that would end the IRS' authority to deploy private collection agencies against dead-beat taxpayers.

The bill (H.R. 5719) cleared the committee 23-17 [Vote 4] after the committee, in another strictly party line vote of 23-17 [Vote 2], rejected an amendment offered by Rep. Kevin Brady, R-Texas, to strip out the provision in the legislation that would eliminate the IRS' authority to outsource the collection of delinquent taxes to the private agencies.

 

A similar repeal of the authority passed the House last year only to bog down in the Senate due to opposition from Sen. Charles Grassley, R-Iowa, and a veto threat from the White House.

Under prodding from the National Treasury Employees Union, Democrats have been trying to kill IRS' power to outsource since it was approved as part of a 2004 revamping of corporate tax law. The union has claimed that the IRS' tax collection system is more efficient and that the private program loses the government tens of millions of dollars a year.

"This program has not made money, it has lost money," said Rep. Earl Pomeroy, D-Calif., "I think it's time we pack this experiment in."

 

Republican defenders of the outsourcing system pointed to a recent Joint Committee on Taxation analysis estimating that ending the program would cost the government $578 million in back-tax recovery over the next decade.

"It would be counter-productive to eliminate this program," said Rep. Jim Ramstad, R-Minn.

Democrats also charged that the use private agencies had led to abuses. "Would you rather deal with the IRS or a private collector calling you at three o'clock in the morning?" asked Rep. John Lewis, D-Ga.

Responded Rep. Tom Reynolds, R-N.Y.: "I know some of these people. I grew up with some of them. They do not call at three o'clock in the morning."

 

In a mostly party line vote, the committee rejected 24-16 [Vote 3] an amendment proposed by Rep. Paul Ryan, R-Wisc., to scuttle a provision requiring the substantiation of tax deductions for health care costs financed from medical savings accounts. Supporters of the amendment said the new requirement would make it harder for workers to benefit from the accounts.

Democratic defenders of the substantiation requirement argued that it was needed to prevent the misuse of the accounts. "Do you know that some of these accounts have been used to pay for massage parlors?" said Rep. Joseph Crowley, D-N..

Among Republicans, only Rep. Jon Porter, R-Nev, opposed the effort to strike the requirement.

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The committee also voted strictly along party lines to reject 23-17 [Vote 1] an amendment offered by Rep. Wally Herger, R-Calif., to repeal permanently a recently imposed three-percent withholding requirement on payments made to government contractors. The bill calls only for a one-year suspension of the requirement.

In other major provisions, the overall bill would eliminate special requirements for individuals to keep detailed records of calls on employer-provided cell phones to substantiate business use, allow IRS employees to refer taxpayers needing assistance to low-income tax return assistance clinics, authorize an annual $10 million grant for volunteer income tax assistance, require the IRS to provide outreach to wage earners eligible for the earned income tax credit, and bar the agency from providing tax debt information to refund lenders.

In addition, the legislation would reduce the penalties for tax liability understatements paid by tax return preparers, allow the IRS to disclose taxpayer identification information in unclaimed refund notices posted on the agency's website, and commission a one year-study on the feasibility of providing tax refunds on debit cards.

To offset the $550 million-plus costs of the changes, the bill would increase penalties for failures to file returns on partnership, corporate and other tax returns.

Recorded Votes

Bill: H.R. 5719 Vote: 1

Herger amendment to repeal permanently a three-percent withholding requirement on payments made to government contractors.

Tally: 17 Yes, 23 No, 1Not Voting

Democrats (24)

NRangel (D-N.Y.)

NStark (D-Calif.)

NLevin (D-Mich.)

NMcDermott (D-Wash.)

NLewis (D-Ga.)

NNeal (D-Mass.)

NMcNulty (D-N.Y.)

NTanner (D-Tenn.)

NBecerra (D-Calif.)

NDoggett (D-Texas)

NPomeroy (D-N.D.)

NTubbs Jones (D-Ohio)

NThompson (D-Calif.)

NVLarson (D-Conn.)

NEmanuel (D-Ill.)

NBlumenauer (D-Ore.)

NKind (D-Wisc.)

NPascrell Jr. (D-N.J.)

NBerkley (D-Nev.)

NCrowley (D-N.Y.)

NHollen (D-Md.)

NMeek (D-Fla).

NSchwartz (D-Pa.)

NDavis (D-Ala.)

Republicans (17)

YMcCrery (R-La.)

YHerger (R-Calif.)

YCamp (R-Mich.)

Y Ramstad (R-Minn.)

YJohnson. (R-Texas)

YEnglish (R-Pa.)

YWeller (R-Ill.)

YHulshof (R-Mo.)

YLewis (R-Ky.)

YBrady (R-Texas)

YReynolds (R-N.Y.)

YRyan (R-Wisc.)

YCantor (R-Va.)

YLinder. (R-Ga.)

YNunes (R-Calif.)

YTiberi. (R-Ohio)

YPorter (R-Nev.)

Bill: H.R. 5719 Vote: 2

Brady amendment to strip out repeal of IRS authority to hire private collection agencies.

Tally: 17 Yes, 23 No, 1 Not Voting

Democrats (24)

NRangel (D-N.Y.)

NStark (D-Calif.)

NLevin (D-Mich.)

NMcDermott (D-Wash.)

NLewis (D-Ga.)

NNeal (D-Mass.)

NMcNulty (D-N.Y.)

NTanner (D-Tenn.)

NBecerra (D-Calif.)

NDoggett (D-Texas)

NPomeroy (D-N.D.)

NTubbs Jones (D-Ohio)

NThompson (D-Calif.)

NVLarson (D-Conn.)

NEmanuel (D-Ill.)

NBlumenauer (D-Ore.)

NKind (D-Wisc.)

NPascrell Jr. (D-N.J.)

NBerkley (D-Nev.)

NCrowley (D-N.Y.)

NHollen (D-Md.)

NMeek (D-Fla).

NSchwartz (D-Pa.)

NDavis (D-Ala.)

Republicans (17)

YMcCrery (R-La.)

YHerger (R-Calif.)

YCamp (R-Mich.)

YRamstad (R-Minn.)

YJohnson. (R-Texas)

YEnglish (R-Pa.)

YWeller (R-Ill.)

YHulshof (R-Mo.)

YLewis (R-Ky.)

YBrady (R-Texas)

YReynolds (R-N.Y.)

YRyan (R-Wisc.)

YCantor (R-Va.)

YLinder. (R-Ga.)

YNunes (R-Calif.)

YTiberi. (R-Ohio)

YPorter (R-Nev.)

Bill: H.R. 5719 Vote: 3

Ryan amendment to strip a provision requiring the substantiation of tax deductions for health care costs financed from medical savings accounts.

Tally: 16 Yes, 24 No, 1Not Voting

Democrats (24)

NRangel (D-N.Y.)

NStark (D-Calif.)

NLevin (D-Mich.)

NMcDermott (D-Wash.)

NLewis (D-Ga.)

NNeal (D-Mass.)

NMcNulty (D-N.Y.)

NTanner (D-Tenn.)

NBecerra (D-Calif.)

NDoggett (D-Texas)

NPomeroy (D-N.D.)

NTubbs Jones (D-Ohio)

NThompson (D-Calif.)

NVLarson (D-Conn.)

NEmanuel (D-Ill.)

NBlumenauer (D-Ore.)

NKind (D-Wisc.)

NPascrell Jr. (D-N.J.)

NBerkley (D-Nev.)

NCrowley (D-N.Y.)

NHollen (D-Md.)

NMeek (D-Fla).

NSchwartz (D-Pa.)

NDavis (D-Ala.)

Republicans (17)

YMcCrery (R-La.)

YHerger (R-Calif.)

YCamp (R-Mich.)

YRamstad (R-Minn.)

YJohnson. (R-Texas)

YEnglish (R-Pa.)

YWeller (R-Ill.)

YHulshof (R-Mo.)

YLewis (R-Ky.)

YBrady (R-Texas)

YReynolds (R-N.Y.)

YRyan (R-Wisc.)

YCantor (R-Va.)

YLinder. (R-Ga.)

YNunes (R-Calif.)

YTiberi. (R-Ohio)

NPorter (R-Nev.)

Bill: H.R. 5719 Vote: 4

To approve H.R. 5719, and report it to the full House.

Tally: 23 Yes, 17 No, 1Not Voting

Democrats (24)

YRangel (D-N.Y.)

YStark (D-Calif.)

YLevin (D-Mich.)

YMcDermott (D-Wash.)

YLewis (D-Ga.)

YNeal (D-Mass.)

YMcNulty (D-N.Y.)

YTanner (D-Tenn.)

YBecerra (D-Calif.)

YDoggett (D-Texas)

YPomeroy (D-N.D.)

YTubbs Jones (D-Ohio)

YThompson (D-Calif.)

NVLarson (D-Conn.)

YEmanuel (D-Ill.)

YBlumenauer (D-Ore.)

YKind (D-Wisc.)

YPascrell Jr. (D-N.J.)

YBerkley (D-Nev.)

YCrowley (D-N.Y.)

YHollen (D-Md.)

YMeek (D-Fla).

YSchwartz (D-Pa.)

YDavis (D-Ala.)

Republicans (17)

NMcCrery (R-La.)

NHerger (R-Calif.)

NCamp (R-Mich.)

NRamstad (R-Minn.)

NJohnson. (R-Texas)

NEnglish (R-Pa.)

NWeller (R-Ill.)

NHulshof (R-Mo.)

NLewis (R-Ky.)

NBrady (R-Texas)

NReynolds (R-N.Y.)

NRyan (R-Wisc.)

NCantor (R-Va.)

NLinder. (R-Ga.)

NNunes (R-Calif.)

NTiberi. (R-Ohio)

NPorter (R-Nev.)

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