Taxpayer Protection Act of 2007

Madam Speaker, I yield myself so much time as I may consume.

(Mr. REYNOLDS asked and was given permission to revise and extend his remarks.)

Today is Tax Day, Madam Speaker, and all across the country, millions of Americans will wait patiently, or not so patiently, in line at the local post office, making sure that their taxes are postmarked by the midnight deadline.

Having recently struggled through the process of filling out my own tax forms, I share the frustrations of millions of American taxpayers, not just with the amount of taxes that we have to pay, but with the dizzying maze of forms, worksheets and calculations required by the IRS as well.

But instead of working together in a bipartisan way to simplify the process and enhance taxpayers rights, the majority has chosen to bring forward a partisan, political bill that has already drawn a veto threat from the administration, and is almost certainly ``dead on arrival'' in the other body.

To be sure, this legislation does contain a number of positive, pro- taxpayer provisions, most of which have already passed the House last year in an overwhelmingly bipartisan basis as part of H.R. 1677. Unfortunately for this House, and for taxpayers across the country, the majority has now abandoned that commonsense bipartisan approach that we brought to last year's bill.

Instead the majority has included a pair of highly controversial proposals that kill any hope of bipartisan cooperation, one imposing a new substantiation requirements on withdrawals from health savings accounts, and another cutting off the ability of carefully selected private businesses to assist the IRS in collecting delinquent tax debt.

Over the course of today's debate, we'll hear much more about the concerns that many Members have about the HSA provision, a provision that was not subject to a single hearing in the Ways and Means Committee, and was inserted into the bill just prior to mark-up without any real understanding of the potential consequences.

So let me take a moment to focus on the other provision of concern, the proposal to repeal the IRS's authority to work with private collection agencies to ensure that acknowledged tax debt is actually paid.

For some Members of this body on both sides of the debate, this particular issue is simple and is simply about policy. For them, it's an abstract question about whether these private collection agencies, so called PCAs, should be able to play a limited supplementary role in ensuring that undisputed tax debts are, in fact, paid.

As we debate this particular issue yet again this afternoon, we'll hear again persuasive evidence making clear just how successful the PCA program has already been in narrowing the tax gap, and while carefully protecting taxpayers rights. And we will also hear how much additional promise this program holds for the future if it's allowed to continue.

But for me and the area I represent, Western New York, the issue is much more than an abstract policy debate. It's also about jobs. As the Member of Congress who represents rural Wyoming County in Western New York, I'm actually more familiar than most Members with the work that PCAs do. After all, the largest single private employer in Wyoming County, Pioneer Credit Recovery, is one of the only two companies nationwide that the IRS has selected to help get this important program underway.

Madam Speaker, Pioneer Credit is a highly respected local business that has created more than 1,400 high-paying jobs for families living in either my district or neighboring districts around Buffalo and Rochester. And as my fellow Members of Western New York's Congressional Delegation know, these jobs have been created in a region that has faced serious economic challenges.

This IRS contract has allowed Pioneer Credit to turn an empty warehouse in Perry, New York into a thriving job center for newly hired employees. In short, it's been a great economic success story in part of Western New York that has desperately needed it.

As someone who fought to give the IRS the authority to partner with these private companies in the first place, I am deeply troubled that the new majority is once again threatening to deauthorize this important program just as it's getting underway.

If this program is allowed to continue, Pioneer Credit will have the opportunity to compete for future IRS contracts that could create many additional jobs in the area of Western New York that I represent. Killing this program, on the other hand, would cost my constituents real jobs at a time when Congress should be working to expand employment opportunities, particularly in hard-hit areas that are struggling economically.

I would also like to note, Madam Speaker, that under the Democrats convoluted PAYGO rules, proposals that reduce anticipated Federal revenues must be offset by other provisions that raise revenue. As a result, today's

proposal to eliminate the PCA program, a program that is currently expected to bring in more than a half billion dollars to the Federal Treasury, over the next decade, also requires them to raise Federal revenue or taxes by the same amount somewhere else. That's right. The majority is raising taxes by a half a billion dollars today in order to eliminate the very program that's helping us to collect undisputed tax debts, more effectively. Only in Washington, Madam Speaker, only in Washington.

This bill is wrong on policy, it's wrong on job creation and it's on the way to mark April 15 for America's hard-working taxpayers.

I urge a ``no'' vote.

I reserve the balance of my time.

Madam Speaker, I yield 3 minutes to my distinguished colleague on the Ways and Mean Committee from Wisconsin (Mr. Ryan), an expert on HSAs and other matters for consideration today.

Madam Speaker, I've been listening to some of my colleagues, and I'm sure we'll have more on the Democratic side of the aisle that have been such proponents of doing away with the collection. I just want to remind some of them of a couple of things that we should look at.

First, this is money that the IRS will not go after. It is part of the goal that Congress said we will pursue to get this money, and it was going to show a $1 billion over 10-year revenue.

Now, we have seen the start-up of PCAs, one in Iowa and one in New York, after a very clear scrutiny by the IRS and by strong oversight of the Congress. And there are start-up costs of the $50 million, as we're beginning to see the program come under way, to pursue money that the IRS either hasn't collected, can't collect, will not collect as the PCAs are pursuing it.

And I have listened to a lot of people describe what they think they understand of a PCA, but they have never really been in tune with it. It kind of reminds me of somebody debating ATM legislation and never actually used an ATM.

Madam Speaker, I yield 2 minutes to the distinguished senior member of the Ways and Means Committee from California (Mr. Herger).

Madam Speaker, I would like to yield 2 minutes to my colleague, the distinguished ranking member of the Health Committee of Ways and Means from Michigan (Mr. Camp).

I yield the gentleman an additional minute.

Madam Speaker, may I inquire as to how much time is remaining on both sides.

Madam Speaker, I yield myself as much time as I may consume.

Well, I just want to make sure at least the taxpayers from the countryside I come from realize that H.R. 5719, which we're considering, the Taxpayer Assistance and Simplification Act of 2008, really sounds good. It sounds real good on Tax Day, as I open my remarks by saying that taxpayers are in line now or will be until midnight tonight to have a postmarked April 15 date. But we know that this legislation will face a steep consideration of some saying ``dead on arrival'' in the other body. We've seen the administration have its advisers threaten veto. And yet, while there were so many things that we agreed upon in the Ways and Means Committee, Republicans and Democrats, we have a bill that brings controversy, that brings another one-House bill. It gets tough, as we move towards November of an election year, to explain that we didn't get much done, but boy did we have a lot of action on one-House bills.

I want to just share for the record here on this body what I did in the Ways and Means hearing. Because I think there's two important documents that my colleagues, as this debate goes today, and some of the consideration of what will be difficult on seeing PCAs, as the legislation may come to pass from this body, we will see difficult sledding in the other body, as well as the administration, are two reports.

The Treasury Inspector General for Tax Administration wrote one on March 26, only weeks ago, that had inadequate security controls over routers and switches that jeopardize sensitive taxpayer information. It was done by the Inspector General. And I want to just report, because we had it confirmed by representatives of the administration under our examination that this, in fact, has occurred and it's in the report which was submitted to the Ways and Means Committee. And it says, ``Impact to the Taxpayer: Because the IRS sends sensitive taxpayer and administrative information across its networks, routers on the networks must have sufficient security controls to deter and detect unauthorized use. Access controls for IRS routers were not adequate, and reviews to monitor security configuration changes were not conducted to identify inappropriate use. A disgruntled employee, contractor or a hacker could reconfigure routers and switches to disrupt computer operations and steal taxpayer information in a number of ways, including diverting information to unauthorized systems.''

Madam Speaker, that same very day, on March 26, the same Treasury Inspector General for Tax Administration issued a second report called, ``The Private Collection Agencies Adequately Protected Taxpayer Data.'' And this information also was confirmed under examination as we made inquiries to the administration that confirmed that the reports exist, and they were well aware of these findings as well. And on page 2 of the Inspector General's report it said, ``We reviewed the computer security controls over taxpayer data provided to the two current PCAs,'' or private collection agencies for those maybe not following the debate, ``and determined that the controls were adequate. In particular, files were securely transmitted from the IRS to the contractors and adequately secured on the contractor systems. In addition work stations used by contractor collection personnel were adequately controlled to prevent unauthorized copying of taxpayer information to removable media or transfer via e-mail. The contractors also maintained adequate audit trails and performed periodic reviews, including reviews to identify unauthorized access to taxpayer data.''

Now, the response from the IRS, contained also on page two of the Treasury Inspector General said, ``The key IRS management officials reviewed the report prior to issuance and agreed to the results of the review.''

We know that in the operation of PCAs, we are going to see the collection pursuit of $500 million over that over the next 10 years. And we know that if this legislation prevails, there is going to be a tax increase of $500 million to pay for this under the majority's PAYGO rules. And so as we continue the debate, make it clearly understood that the pursuit of these PCAs was on proceeds that were not collected, could not be collected, needed to be collected in order to put into the Treasury this money owed by taxpayers to the government. And that as

we look at this legislation, what has brought the controversy to uncontroversial legislation, legislation that both parties could agree to, was the adding of HSA changes and dealing with the PCAs. My colleagues need to consider the type of consequences we're seeing in what will be a misguided change on PCA legislation.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I yield myself such time as I may consume.

I have listened very carefully to my friend and colleague from New York as he sees his views.

I thought maybe I might for the record just outline that I have a copy of a letter that numerous groups sent in opposition to this legislation, primarily due to HSAs, to both Chairman Rangel and Ranking Member McCrery. And it leads off with the NFIB and goes down to the National Taxpayers Union, and it has the U.S. Chamber and it has the Retail Industry

Leaders Association, the National Retail Federation, the National Restaurant Association, the National Association of Manufacturers, and so many others. And I will make it available in case some of my colleagues haven't seen it.

This isn't something Republicans on this side of the aisle just kind of dreamed up that there are problems that make this legislation controversial with HSA legislation or with the PCAs. It's well documented by the experts that are using the program.

I also think, rather than some of my colleagues interpreting what the administration may have for support or rejection of the legislation, maybe I should read into the Record exactly what the Statement of Administration Policy is on H.R. 5719 so that we all know what the administration's concerns are.

And for the record: ``The administration strongly opposes H.R. 5719, the so-called `Taxpayer Assistance and Simplification Act of 2008.' The bill includes provisions that would impose new administrative burdens on the trustees of health savings accounts. These new burdens on HSA administrators are unnecessary for efficient tax administration, inconsistent with the flexibility purposely afforded HSAs at their inception, and could undermine efforts by employers, individuals, and insurers to reduce health care costs and improve health outcomes by empowering consumers to take greater control of health care decision making. If H.R. 5719 were presented to the President with these provisions, his senior advisers would recommend he veto the bill.

``Also, the administration strongly opposes provisions of the bill that would repeal the current statutory authorization for the Internal Revenue Service private debt collection program. As of February 2008, over 98,000 cases have been referred to contractors, representing over $910 million in delinquent accounts. Terminating this program would result in a loss of $578 million in revenue over the next 10 years, according to Congress' Joint Committee on Taxation. These are tax dollars that are legally owed to the government and are otherwise very unlikely to be collected by the IRS due to workload demands. As noted in previous Statements of Administration Policy, the administration strongly opposes elimination of this program, which is not consistent with the administration's commitment to a balanced approach toward improving taxpayer compliance and collecting outstanding tax liabilities. If H.R. 5719 were presented to the President with these provisions, his senior advisers would recommend that he veto the bill.''

That is a Statement of Administration Policy on the record relative to this.

I now would yield to my colleague from New York for a question.

Well, I will ask you to look that up, and at a later time I will yield and you can point it out in my record.

One more time.

Reclaiming my time, Madam Speaker, I thank the gentleman.

I just think it's important we look at this. First, I heard the debate coming from the majority, from the gentleman, that outlined his interpretation of why the administration was opposed to the bill. I listened carefully. I made a decision to read into the Record exactly what the administration's policy position was on this so that it was no longer an interpretation from a Member of Congress but exactly in written word what the administration said relative to this bill.

And I think while we're looking at other aspects of this legislation, we do know the following: That the administration is going to veto this legislation, that we also know it has difficult sledding in the other body. And it has in the past because there's a track record, that it appears just with PCA alone, let alone some of the concerns that have been put forth in the letter that I read from earlier on HSAs, that we now have another one-House bill being trumped up and laid out on Tax Day.

And I will say the majority is superb in showmanship. We seem to be able to move legislation to the floor on significant days. Today is tax legislation on Tax Day, April 15.

But I also know that the public is not going to be confused by the fact that while we trump up an extravaganza of legislation on special days, today tax legislation on April 15, that the voters are going to take a real hard look at what really got done, what has gotten through, what was made better for America. And, again, we have another one-House bill that just, sadly, had too much partisanship in it and fell away.

Madam Speaker, I reserve the balance of my time.

Madam Speaker, I think I heard my colleague when he said that Democrats are in the majority in this body, Democrats are in the majority in the other body, but it's the Republicans' fault that this legislation isn't going to happen.

Now, I have explained a lot of tough, challenging things to my constituents, but I don't think they're going to buy that. It's just another one-House bill that is going to the other body and going to see death. It isn't going to see the light of day.

Now, moving to my colleague from New York who asked me the question. I didn't think I could provide the answer to his question quite as soon as I could, and saving him looking it up, because I assume as he went off the floor, he might be looking up this. I want to go back again to the statement of administration policy. The bill includes provisions that would impose new administrative burdens on the trustees of health savings accounts. That is what the administration said in their veto threat.

Now on the bill as reported out of committee by the majority, page 22, line 7, 8 and 9 to my colleagues, says the trustee of the health savings account shall make a report regarding such account to the Secretary and account beneficiary setting forth. So I want everyone to know, including my colleague who asked the question, it is clear in your bill that you set forth that the HSA trustees would have new administrative burdens.

I reserve the balance of my time.

Madam Speaker, may I inquire on the amount of time left, please.

Madam Speaker, I am prepared to close if the gentleman is. I would proceed and then have you close if you are ready.

I thank the gentleman from Georgia who has done a magnificent job of managing his time, and I've enjoyed working with him.

Madam Speaker, today represents yet another missed opportunity on the floor of this House. We could have approached the issues of taxpayer rights and tax simplification in a bipartisan way just as we did last year. But with the election season now in full swing, the majority seems more interested in staging political theater than in actually getting something done for hardworking, middle-class taxpayers. This House and this country deserve more, especially on April 15, Tax Day. I urge a ``no'' vote.

I yield back the balance of my time.

Madam Speaker, I demand a recorded vote.

Madam Speaker, I appreciate very much the gentleman from Georgia's leadership of the Oversight Subcommittee on the Ways and Means Committee.

A couple of things to respond to.

The matter before us involves a pay-for, because unlike much of the work of my friend, the ranking member of the Budget Committee, this majority pays for things that cost the Treasury.

Now, the HSA issue he just raised involves tax-free accounts and savings accounts to be used for health care. We ask that there be some verification to show the money withdrawn was spent for health care. That's all. What drives us to this is a report that we had from one account manager that shows these funds being withdrawn for everything from body shop repair to fast food restaurants.

Sure I will yield.

Reclaiming my time, and I only have 2 minutes, this HSA, I believe the gentleman would agree, in fact I think he said it in his comments, is for the cost of health care. It gives a tax incentive cost, a tax assistance to taxpayers for health care costs, not for body shop costs. We don't tax incent body shop costs. So we would like to shut that abuse down.

The question is legitimately raised. Is this too onerous? Absolutely not. Many of us have flex savings accounts that are used for medical costs. Now,

all we ask is that the same verification any Federal employee uses when they make a withdrawal in their flex savings account would be used to substantiate withdrawal from the health savings account. This isn't inventing something new. We've done it. It works well.

Another feature of the bill that's drawn such objection is this business of putting out of business the whole notion of private bill collectors being loosed on our taxpayers to collect revenues owed the Federal Government.

Madam Speaker, I refer my colleagues to the Washington Post, the front page story today, ``Collectors cost IRS more than they raise.''

We have had, in fact, kind of the bill collection version of the $600 toilet seat for the old Pentagon contract procurements. This was advertised to cost very little, $10 to $14 million, well now up to $70 million and counting, a multiple of what was initially advertised. That's the set-up cost. They said it was going to bring all of this money. Well, the reality is it has brought in only a fraction of the money advertised.

And so on a net basis, this whole initiative to bring in money owed us has cost us money. We've been shipping more money to contractors. This is an administration and this is a minority that loves private contractors. And if it costs the Federal Government on the net balance, it doesn't matter because they just so ideologically love private contractors.

We should pass this bill and end this failed experiment of private debt collection.

I thank the chairman for yielding.

I want to begin my remarks by commending the fine job Mr. Reynolds has done today. He has indicated that this legislation uniquely affects him because many of the people at the Pioneer Call Center, a private debt collector hired to collect this debt, are in his district. And I think we all recognize he has done a fine job in fighting for that business activity in his district today. He has given it everything he has, and I commend him for the job he has done.

But the reality in the policy context is summed up in a simple headline in today's Washington Post, ``Collectors Cost IRS More Than They Raise.'' Why in the world would we want to continue with an arrangement like that? But there are many other parts of this bill that are simplifying the process and are helpful to taxpayers. And that is why we have the support of the American Institute of Certified Public Accountants, the National Association of State Auditors, Comptrollers and Treasurers, the National League of Cities, U.S. Conference of Mayors, Citizens for Tax Justice, National Consumer League, Consumer Federation of America, and a late-breaking one. In fact, this organization has been mentioned on both lists, the NFIB.

Mr. Reynolds has indicated they were opposed to the bill. This is probably a development that broke later than Mr. Reynolds' information. But in fact, they are for the bill and indicate in a ``key vote alert'' that they will be scoring this as a key vote. They indicate that the ``provisions in this legislation seek to enact simpler tax rules and reduce the paperwork burden associated with tax compliance.''

They talk about a few provisions. One of them is that right now we have an onerous paperwork requirement on employers providing cell phones to employees for business purposes. I commend my Republican colleague on Ways and Means, Sam Johnson, for bringing this to our attention. I was pleased to cosponsor legislation with him now included in the bill that

makes this paperwork requirement go away.

I thank the gentleman for yielding.

And so including the Pomeroy-Johnson or the Johnson-Pomeroy bill in this I think was an important feature to the NFIB deliberation that this is indeed lessening paperwork requirements on small employers, and therefore they support it. They do cite a couple of other provisions, another provision of this legislation amending a recent change to the Tax Code that helps tax preparers better assist their clients by changing an established higher standard of reporting for preparers. That creates a potential conflict of interest between clients and themselves. That is addressed in this legislation.

And they also talk about the legislation including a 1-year delay of the implementation of the 3 percent withholding requirement by Federal, State and local governments on payments for goods and services which puts both an administrative burden on all parties involved and a strain on the daily operating cash flow of small businesses. There are other provisions, as well, but I appreciate the NFIB's laying them out as they have done on this letter.

In balance, this is a bill designed to help taxpayers. That is why we passed it out of the Ways and Means Committee. That is why it is before us on Tax Day. We urge its adoption.

Madam Speaker, I rise in opposition to the motion to recommit.

Madam Speaker, we have just obtained the motion in terms of trying to sort through the tax provisions, with an eye, among other things, to wondering whether or not people holding bonds of municipalities could suddenly find themselves with taxes they didn't think they were going to have when they bought these bonds.

Trying to work our way through these, one word jumped out on this motion to recommit that really has shut down all further analysis by us, and that is the word ``promptly,'' because this is yet another one of those motions to recommit that is designed for one purpose and one purpose only, and that is to kill the bill they are trying to attach it to. That is because this would take the Taxpayer Assistance and Simplification Act that we want to pass than April 15th and pack it off back to the Ways and Means Committee, dispensing any possibility of passing it off the floor today. It is a procedural move by the minority to try and stop us from moving forward with this legislation.

What is unfortunate about that is there are taxpayers that are going to be benefited, benefited substantially, by this legislation, small businesses that right now are subject to IRS audit exposure if they are not keeping detailed call records on cell phones that they give their employees. We want to take this relief away through this motion to recommit? I don't think so.

We go through so many positive, taxpayer-friendly provisions in this bill, provisions that have received the support of so many diverse organizations, from the League of Cities, Association of Mayors, NFIB and Consumers Federation of America, it would take that and take it off the table today, preventing the House from moving this forward.

Now, you think, why? What is the motive behind a motion like this? Why would they not want this taxpayer bill to move forward? Well, my friends, you can find it on the front page of today's Washington Post. Basically, they are trying everything they can to preserve private bill collectors hired by the IRS to chase after taxpayers.

So here on Tax Day, April 15th, we are trying to stop private bill collectors from going after taxpayers on behalf of the IRS, an endeavor that has cost taxpayers millions and brought in not enough by any measure to cover the cost; a forgone revenue opportunity of $81 million, testified by the Taxpayer Advocate, if we simply took the money we sent to these private contractors and hired employees to go ahead and collect that debt. But they are so completely convinced that they have got to pull every trick out of their hat to try and stop our efforts to rein in these private bill collectors that they brought this motion to recommit.

I would yield such time as I have remaining to the gentleman from New York (Mr. Crowley).

I yield back the balance of my time.

Parliamentary Inquiry

Madam Speaker, I rise in strong support of H.R. 1677, the ``Taxpayer Protection Act of 2007.''

I would like to focus my remarks on Section 8 of this bill, which clarifies the intent of the Congress that the existing legal prohibitions on the misuse of Department of the Treasury names and symbols also extend to misuse over the Internet. I support this provision, which addresses a very real problem that currently exists with potentially misleading commercial websites that taxpayers may mistakenly believe to be affiliated with the IRS.

In February, the Subcommittee on Telecommunications and the Internet, which I chair, became aware of three commercial websites operating under domain names which may confuse the public into believing them to be official IRS websites: IRS.com, IRS.net and IRS.org. In response to this situation, I wrote to the Federal Trade Commission Chairman Majoras, Secretary of the Treasury Paulson, and Internal Revenue Service Commissioner Everson to express my concerns that consumers who visited these sites might provide the operators with personally identifiable information and tax return information, enabling the operators to either market or sell this information to others, or to sell and market all manner of products and services to these taxpayers.

A consumer survey and study presented to the IRS and FTC in early January of this year by the Computer and Communications Industry Association suggested that a significant proportion of consumers misinterpreted these three non-governmental Websites as being sites hosted by the IRS. The survey showed, for example, that before viewing the website IRS.com, 47 percent of those surveyed believed the site represented the Internet address of the Internal Revenue Service. Even after viewing the site, \1/3\ of those surveyed still believed the site was the IRS website.

Now, the IRS.com website bears a remarkable resemblance to the official IRS.gov site. Both websites have the same color blue banner at the very top, a grey search bar right below, and a white background with various links and search features covering the bulk of the page. Back in February, the IRS.com site even had an actual image of the U.S. Treasury headquarters building on the top of the

page. At the time, there was only a fine-print disclaimer at the bottom of these sites stating that that it was a non-governmental site. This disclaimer was so far down on the webpage that few consumers were likely to view it.

I continue to be concerned about the potential for unfair or deceptive trade practices associated with these commercial websites, and I believe that we need to do more to ensure that the public does not continue to be exposed to these potentially misleading or confusing websites. There is no relationship between a citizen and our government more sensitive, nor information more private, than that involving individual taxes and the annual voluntary compliance obligation. The federal government has a duty to protect taxpayers from predatory behaviors as they seek to meet their obligation to pay taxes.

I am hopeful that, by clarifying the intent of the Congress that the existing legal prohibitions on misuse of Treasury Department and IRS names and symbols are and should be applied to commercial activity on the Internet, this bill will better protect the public from this kind of operation in the future.

I urge adoption of the bill.

Madam Speaker, I rise in strong support of H.R. 1677, the ``Taxpayer Protection Act of 2007.''

I would like to focus my remarks on Section 8 of this bill, which clarifies the intent of the Congress that the existing legal prohibitions on the misuse of Department of Treasury names and symbols extend to misuse over the Internet. I support this provision, which addresses a very real problem that currently exists with potentially misleading commercial Web sites that taxpayers may mistakenly believe to be affiliated with the IRS.

In February, the Subcommittee on Telecommunications and the Internet, which I chair, became aware of three commercial Web sites operating under domain names which may confuse the public into believing them to be official IRS Web sites: IRS.com, IRS.net, and IRS.org. In response to this situation, I wrote to the Federal Trade Commission Chairman Majoras, Secretary of the Treasury Paulson, and Internal Revenue Service Commissioner Everson to express my concerns that consumers who visited these sites might provide the operators with personally identifiable information and tax return information, enabling the operators to either market or sell this information to others, or to sell and market all manner of products and services to these taxpayers. Since the taxpayers who provide personal information to these sites might be doing so under the misimpression that they were dealing with an official government Web site subject to applicable federal privacy protections, I felt there was a serious potential for consumer confusion, deception, and abuse.

In fact, a consumer survey and study presented to the IRS and FTC in early January of this year by the Computer and Communications Industry Association suggested that a significant proportion of consumers misinterpreted these three nongovernmental Web sites as being sites hosted by the IRS. The survey showed, for example, that before viewing the Web site IRS.com, 47 percent of those surveyed believed the site represented the Internet address of the Internal Revenue Service. Even after viewing the site, one third of those surveyed still believed the site was the IRS Web site.

Now, the IRS.com Web site bears a remarkable resemblance to the official IRS.gov site. Both Web sites have the same color blue banner at the very top, a grey search bar right below, and a white background with various links and search features covering the bulk of the page. Back in February, the IRS.com site even had an actual image of the U.S. Treasury headquarters building on the top of the page. At the time, there was only a fine-print disclaimer at the bottom of this site stating that it was a non-governmental site. This disclaimer was so far down on the Web page that few consumers were likely to view it.

I asked the FTC, the Treasury, and the IRS to look into the issues raised by this Web site, as well as the IRS.org and IRS.net sites. The IRS and the Treasury Department have never formally responded to my inquiry. However, the IRS has issued a press statement warning taxpayers about these potentially misleading sites. The FTC did respond to my letter, but in that response merely noted that in response to the concerns I had raised, the operator had ``made a number of changes to distinguish it from the official IRS Web site, and to better highlight the disclaimers included on the Web site.''

I continue to be concerned about the potential for unfair or deceptive trade practices associated with these commercial Web sites, and I believe that we need to do more to ensure that the public does not continue to be exposed to these potentially misleading or confusing Web sites. There is no relationship between a citizen and our government more sensitive, nor information more private, than that involving individual taxes and the annual voluntary compliance obligation. The federal government has a duty to protect taxpayers from predatory behaviors as they seek to meet their obligation to pay taxes. I am hopeful that by clarifying the intent of the Congress that the existing legal prohibitions on misuse of Treasury Department and IRS names and symbols is and should be applied to commercial activity on the Internet, that this bill will better protect the public from this kind of operation in the future.

I urge adoption of the bill.

I want to thank my good friend from Georgia (Mr. Lewis) for yielding me this time.

My colleagues, this is a good bill, and I ask all my colleagues to support this worthy effort.

And Chairman Lewis, I want to thank you personally, and your staff. You went out of your way to include language that I had concerns of and wanted to include in this bill to increase the access of eligible taxpayers to the EITC, the earned income tax credit. So I want to personally thank you and your staff for your outreach to our office and including that. Ronald Reagan himself referred to the EITC as the greatest anti-poverty program in the history of our country, so I think it deserves worthy bipartisan support.

Madam Speaker, we heard in testimony last week in the Committee on Ways and Means from the Taxpayer Advocate of the United States that identity fraud against taxpayers is skyrocketing. This bill establishes some of the strongest protections for taxpayers against identity theft scams, especially those at greatest risk of fraud, our seniors and veterans filing this year to claim the economic stimulus rebate check. But my colleagues on the other side of the aisle, my Republican colleagues and the Bush Administration, are adamantly opposed to this taxpayer protection act because they're opposed to the offset that we provide.

No one can argue that some of my Republican colleagues philosophically oppose paying for anything and support the continuation of what I believe was 7 years of Republican economic theory of ``borrow and spend.'' And in case you're keeping count, the results of the Republican borrow and spend credit card economic policy is a $30,000 birth tax on every person born in this country today. In fact, in my own home, it's at $90,000 because I have an 8-, 7-, and 2-year-old. I can't imagine that they would be very happy if they understood what the birth tax was that was placed upon them by irresponsible and reckless fiscal policies over the last 7 years.

Madam Speaker, that's why Democrats are trying to be responsible and we implemented the pay-as-you-go principles, meaning all new tax cuts and new spending increases need to be paid for as we move forward.

In regards to the health savings account, I really don't understand the opposition here. What we're simply asking for is accountability. We know that health savings accounts have been spent for country club membership, massage parlors, women's lingerie shops, casinos and gambling, dating and escort services.

Let's really put this all in perspective. What we're talking about is accountability in health savings accounts. We're not saying they shouldn't be used for health purposes, but they should be held accountable.

People right now, hardworking, honest, faith-loving Americans that want to donate to a charity or to their church with after-tax payments have to account for that charitable contribution before they can take a tax deduction. When it comes to health savings accounts, there is not that requirement. And we're talking about pretax dollars on health savings accounts. There's something wrong here. I wish my Republican colleagues would better understand it. It's simply absurd that they don't support simple accountability.

It is simply absurd to me that my Republican colleagues can't understand that we're simply asking for accountability, that we're not looking to eliminate them, that if they are using it for legitimate health purposes, that's fine.

Now, I did note that the HSA, the Health Savings Account Council, says that the IRS has the authority to audit these accounts. Are they suggesting that the IRS audit every health savings account to make sure that health savings accounts are being used for health reasons? I daresay that the IRS is looking at probably more often than not the charitable contributions that hardworking Americans make and making sure that those are legitimate charities before they're able to deduct them from their taxes.

So what we are looking for is a little balance here in terms of what really are legitimate tax savings purposes in health savings accounts. That's really simply what the Democrats are looking for.

Thank you.

Madam Speaker, I note that the gentleman made reference to the fact that the legislation, or at least the interpretation of the administration, that the legislation places onerous responsibilities on the trustees of the HSAs.

Where in the legislation does it say that?

Will the gentleman continue to yield?

I just would point to the record that, in fact, it is not the responsibility of the trustees but of the individual who opens an HSA account that we're placing the burden on, that they prove that the HSA account is for legitimate medical purposes.

I thank the gentleman.

I perused the motion to recommit by Mr. Herger. I think it is interesting, the other side has pointed out we have chosen today, Tax Day, to bring this bill to the floor. It is also interesting they take this motion to recommit the same day that the Pope has arrived here in the United States, who is with the President right now at the White House; the same Pope who has decried the xenophobic nature of some of the legislation that has been coming out of this House by the other side of the aisle.

I think it is interesting to note that no illegal aliens will be hurt by this motion to recommit. In fact, it will be the elderly woman who relies upon her opportunities to buy these bonds for their income later in life. I would also point out it is quite possible that New York State and California, the States of two of the gentleman here today, could potentially be hurt by this motion to recommit.

I think it is foolhardy. It obviously is an attempt to kill the bill by requiring it be promptly reported back to committee, and therefore the attempt is clear, once again to use anti-immigrant rhetoric to kill the bill and to use ``promptly'' to kill the bill.

I urge my colleagues to reject this motion to recommit and to vote for the underlying legislation.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I strongly support the Taxpayer Protection Act. This legislation is a package of commonsense reforms that passed the Ways and Means Committee by a voice vote with broad bipartisan support, and I want to take this opportunity to thank Chairman Rangel of the full Ways and Means Committee, as well as Chairman Lewis, the chairman of our Oversight Subcommittee, for working in a bipartisan, pragmatic and commonsense way on this legislation, and for working in a bipartisan way thus far generally in the committee. I also want to thank Ranking Member McCrery for his leadership.

Mr. Speaker, true to its name, this bill will protect taxpayers and expand their rights. One important reform will prevent Internet domains from using the Treasury Department's name or symbol, which is usually done to trick people into giving out sensitive personal or financial information. Clearly, this should not be allowed and should be outlawed, as this bill provides. It

prohibits phishing, and by that I mean phishing with a ``P-H,'' not the kind that Minnesota is famous for. We are referring here to mass e-mail communications falsely claiming to be from the IRS that can lead to identity theft and have victimized too many Americans.

The bill also requires the IRS to notify taxpayers when there is an unauthorized use of the taxpayer's identity. This will help taxpayers take steps to clear their names quickly if and when their identity is stolen.

Another commonsense provision of this bill allows the IRS to return funds directly to a taxpayer's retirement account if the IRS improperly levied fines from that account.

One provision, Mr. Speaker, that received considerable attention in the committee deals with refund anticipation loans. I mentioned in the committee that while I certainly understand the motivation behind the provision and the belief that the IRS should not be a facilitator for predatory loans, I am concerned because the bill does not define ``predatory''; but I trust, Mr. Speaker, that will be clarified in the conference.

I also hope we are not inadvertently making this problem worse by denying lenders information on ``debt indicators'' so that the provision increases the risk that a lender will not be reimbursed by the taxpayer's refund. This could cause lenders to increase fees and interest rates even further, making taxpayers pay even more for early access to their refunds. While I am not opposed to the provision, this should be addressed in the conference.

I strongly support another provision in the bill which would encourage the IRS to do more to ensure that taxpayers entitled to receive earned income credit refunds actually receive them.

Mr. Speaker, as we all know, the earned income credit is one of our most effective antipoverty tools for working families. This provision certainly deserves our strong support.

Mr. Speaker, I am also very pleased that the committee adopted my amendment to prevent tax fraud by prison inmates. This amendment is based on legislation that Chairman Lewis and I introduced in the last Congress in response to a hearing we held in 2005. This hearing revealed massive tax fraud going on within the walls of our Nation's prisons. In fact, the IRS testified that 15 percent of all tax fraud in the United States is committed by prison inmates while in prison. Tax fraud in any form is obviously unacceptable and illegal; but it is particularly outrageous and egregious when it is committed by prison inmates who are supposed to be paying their debt to society, not bilking taxpayers.

For example, we heard testimony, Mr. Speaker, from one inmate who had swindled taxpayers to the tune of $3.5 million in false tax return claims, and this was not an isolated incident.

While the IRS is able to detect some inmate tax fraud, far too much of it falls through the cracks. And, unfortunately, the IRS is prohibited by current law from sharing information with prison officials that would allow those officials to punish and stop this fraud.

My amendment, and I appreciate the chairman's support of this amendment, my amendment would allow the IRS to disclose information to Federal prison officials to help them stop the tax fraud that is occurring right under their noses within the walls of Federal prisons. I hope in time this commonsense provision can also be extended to include State prisons.

Mr. Speaker, it is truly fitting that in a bill entitled the Taxpayer Protection Act we protect honest taxpayers from such blatant, outrageous fraud that is being committed by some prison inmates.

Mr. Speaker, I urge my colleagues to protect taxpayers and support this legislation.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield 2 minutes to the gentleman from California (Mr. Herger), a distinguished member of the Ways and Means Committee and ranking member of the Trade Subcommittee.

Mr. Speaker, I continue to reserve the balance of my time.

Mr. Speaker, I yield 3 minutes to the gentleman from Georgia (Mr. Price), a champion of the taxpayer.

(Mr. PRICE of Georgia asked and was given permission to revise and extend his remarks.)

Madam Speaker, may I just inquire as to how many speakers the other side may have.

Madam Speaker, before yielding back, I too want to express my deepest sympathy to the entire Virginia Tech community. Like every other Member of this body, my thoughts and prayers are with all those affected by the tragic and senseless loss of lives.

Having no further speakers, I urge a strong ``yes'' vote for this taxpayer protection.

Madam Speaker, I yield back the balance of my time.