Government-run tax preparation idea is a misguided, unnecessary proposal

TAXES

In 2021, New Hampshire was named the best state for taxpayer return on investment for the second year in a row. Many Granite State residents choose to live here because of our state’s low but efficient tax collection system. After all, our state motto is “live free or die.” That is why I am concerned about proposals being debated in Washington that would give the Internal Revenue Service the added mandate of generating automatic tax returns for every American.

First and foremost, the IRS cannot handle this massive additional responsibility.

President Obama’s former Federal Chief Information Officer recently concluded, “An effort to have the IRS offer pre-prepared tax returns would be operationally impractical, prohibitively expensive, legally questionable and would likely fail to deliver on the promised benefits.”

As it stands, the IRS is having difficulty completing its existing responsibilities. The National Taxpayer Advocate, an independent IRS watchdog organization within the Treasury Department, recently released a blistering report finding, “the IRS is in crisis.”

Tens of millions of taxpayers were forced to wait much longer than normal for the IRS to process their returns, respond to correspondence, or return refund or deduction checks. As of early January, the IRS still has 6 million unprocessed returns from last tax season, forcing many hardworking Americans to wait on the returns and deductions they are rightfully owed.

Under a government-run tax preparation system, taxpayers would have to interact directly with the IRS to answer questions or fix errors on their automatic returns. But this poses serious logistical challenges. The same report from the National Taxpayer Advocate found that only 9 percent of calls to the IRS customer service lines were answered by a representative.

These issues have not been fixed. In January, Treasury Department officials warned that taxpayers will face a “frustrating season” caused by an IRS stretched incredibly thin under its current duties. I’m astounded that some lawmakers in Congress believe giving the agency more responsibilities is a prudent move.

Secondly, charging the IRS with both collecting taxes while also helping taxpayers maximize deductions is a clear conflict of interest. The IRS exists to maximize revenue for the federal government, not taxpayers. The same agency cannot be trusted to have the best interest of taxpayers at heart. Most Americans want to have someone in their corner who advocates for their financial interests, whether that is a certified public accountant or even free online tools.

Taxpayers should also be wary of giving the IRS the additional personal data and information required to generate an automatic return.

In 2016, hackers stole more than 700,000 Social Security numbers during a data breach. In 2017, the IRS also formally apologized for using confidential information to target certain organizations for their political beliefs.

A government-run tax preparation system is unnecessary, would overload an already overburdened IRS, and would represent a clear conflict of interest. As a voice for the hard-working taxpayers of New Hampshire, I urge Sen. Maggie Hassan to work with her colleagues to reject these misguided proposals.

Kevin St. James is an Exeter firefighter/AEMT and Kingston selectmen, and previously served as a Rockingham County commissioner and state representative.