Fair and Accountable IRS Reviews Act
The Fair and Accountable IRS Reviews Act focuses on increasing procedural oversight in how penalties are assessed by the Internal Revenue Service. The core change codifies a requirement that, before any written communication about a penalty is sent to a taxpayer, the initial determination of the penalty must be approved in writing by the individual’s immediate supervisor or a higher-level official designated by the Secretary. The bill also defines who qualifies as an “immediate supervisor” and makes the requirement applicable to notices issued and penalties assessed after December 31, 2025. While the bill’s title mentions reform of penalty and interest provisions, the text provided only specifies the penalty assessment approval process and does not outline changes to interest calculations. The bill was introduced in the 119th Congress by Rep. Grothman (with a second sponsor, Rep. Smith of Nebraska), referred to the Ways and Means Committee, and reported with an amendment.
Key Points
- 1No penalty shall be assessed or entered unless the initial determination has been approved in writing by the immediate supervisor of the tax determination official, or by a higher-level official designated by the Secretary, before any written communication to the taxpayer about the penalty.
- 2Definition added: “immediate supervisor” means the person to whom the individual making the penalty determination reports.
- 3Effective date: applies to notices issued and penalties assessed after December 31, 2025.
- 4Short title: The act is named the “Fair and Accountable IRS Reviews Act.”
- 5Scope note: The text provided focuses on the penalty assessment approval process; while the bill’s title references penalty and interest provisions, no specific changes to interest rules are included in the enacted text shown.