Sanders, Warren Introduce Bill to Simplify Tax Filing

WASHINGTON, April 13 – Sen. Bernie Sanders was an original cosponsor of the Tax Filing Simplification Act of 2016 introduced by Sen. Elizabeth Warren today.  The bill would simplify and decrease the costs of the tax filing process for millions of American taxpayers. This year, taxpayers will spend an average of 13 hours preparing and filing their returns, and will pay $200 for tax preparation services, a cost equal to almost 10 percent of the average federal tax refund.

The legislation introduced today would direct the Internal Revenue Service to develop a free, online tax preparation and filing service that taxpayers can use to prepare and file their taxes directly with the federal government, if they choose to do so, and would prohibit the Internal Revenue Service from entering into agreements that restrict its ability to provide free online tax preparation or filing services. The bill would give all taxpayers the right to download third-party-reported tax information that the Internal Revenue Service already has, and would provide those with simple tax situations with a return-free option.

"Tax Day has become an opportunity for corporations to profit off of confusion over our complicated tax code. That is wrong. The Tax Filing Simplification Act would end the absurdity of Americans having to pay private companies hundreds of dollars to pay their taxes. We must make tax filing as easy as possible, not direct profits to private companies at the expense of working families," Sanders said.

"Congress should be making it easier for Americans to file their taxes each year, not bowing to the interests of the tax prep industry," Warren said. "The Tax Filing Simplification Act is a commonsense bill that would help taxpayers all across this country file their taxes with less stress and fewer costs, and it would push the IRS to use the authority it already has to simplify Tax Day for all Americans."

In conjunction with the introduction of the Tax Filing Simplification Act, Sen. Warren released a staff report that describes how the tax preparation industry has blocked the Internal Revenue Service from implementing laws that would make tax preparation and filing easier for taxpayers for decades. Corporate capture of the filing process means that taxpayers have to absorb billions of dollars in costs and share their personal information with third parties just to file their taxes.

The legislation has been endorsed by dozens of law professors and economists including Austan Goolsbee of the University of Chicago, Emmanuel Saez of the University of California - Berkeley and Joe Bankman of Stanford University. The bill was also cosponsored by Sens. Sheldon Whitehouse (D-R.I.), Tom Udall (D-N.M.), Jeanne Shaheen (D-N.H.), Al Franken (D-Minn.), Tammy Baldwin (D-Wis.) and Edward J. Markey (D-Mass).

Click here for full text of the Tax Filing Simplification Act of 2016.

Click here to read a one page fact sheet on the Tax Filing Simplification Act of 2016.

Click here to read Sen. Elizabeth Warren’s Tax Maze Report.