Taxpayer Notification and Privacy Act of 2025
Summary
The Taxpayer Notification and Privacy Act of 2025 aims to amend the Internal Revenue Code of 1986, focusing on enhancing taxpayer notification when the IRS seeks information from third parties. It mandates the IRS to specify the exact information sought from third parties if the taxpayer could reasonably provide it. The bill also provides taxpayers with a 45-day window to respond before the IRS contacts third parties, unless the Secretary determines the information is necessary regardless of taxpayer input.
Expected Effects
This act will likely increase transparency and taxpayer control during IRS investigations. It could also potentially slow down IRS investigations, as it introduces additional procedural steps and timelines. The specificity requirement may lead to more disputes over what information the taxpayer could 'reasonably' provide.
Potential Benefits
- Increased transparency in IRS investigations.
- Enhanced taxpayer control over their information.
- Opportunity for taxpayers to provide information directly, potentially avoiding third-party contact.
- A standardized 45-day response window for taxpayers.
- May reduce unnecessary third-party contact by the IRS.
Potential Disadvantages
- Potential delays in IRS investigations due to increased procedural requirements.
- Increased administrative burden on the IRS to specify information requests.
- Possible disputes over what constitutes 'reasonably' provided information.
- The exception for information specificity could be broadly applied, negating the intended benefit.
- Could be used to obstruct legitimate investigations.
Constitutional Alignment
The bill aligns with constitutional principles related to due process and protection against unreasonable search and seizure, as it provides taxpayers with more notice and opportunity to respond before the government seeks information from third parties. This is indirectly related to the Fourth Amendment, which protects against unreasonable searches and seizures, and the Fifth Amendment, which guarantees due process. The requirement for specific notice could be seen as promoting fairness and transparency in government actions, aligning with the spirit of these amendments.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).