Sponsors (2)
The bill strengthens taxpayer notice and opportunity to respond—improving privacy protections—but adds procedures that can slow IRS actions and increase administrative costs, and contains exceptions that may blunt those protections in practice.
Taxpayers will receive clearer notice and at least 45 days to respond before the IRS contacts third parties, and are given an explicit opportunity to provide requested information, which should reduce unnecessary third‑party inquiries and better protect taxpayer privacy.
The Secretary of the Treasury and the IRS get a 12‑month delayed effective date to implement the changes, allowing time to update procedures and reducing abrupt operational disruption.
Taxpayers could still be subject to third‑party contacts under broad exceptions for collection or when the Secretary decides the information is necessary, which may substantially weaken the intended privacy protections in practice.
Taxpayers may experience slower enforcement and collection workflows because the expanded procedural steps could delay audits or information gathering, prolonging resolution of tax issues.
The IRS (Department of the Treasury) will likely face increased administrative burden and costs to prepare more detailed notices and manage extended response periods, potentially requiring more staff or resources and raising government expenses.
Based on analysis of 2 sections of legislative text.
Requires the IRS to identify specific items it will seek from third parties and give taxpayers at least 45 days to respond before third-party contact, with limited exceptions.
Requires the IRS to tell taxpayers what specific information it will seek from third parties and give taxpayers at least 45 days (longer for reasonable-cause extensions) to provide that information before contacting those third parties, with limited exceptions. The rule change is delayed for 12 months after enactment and preserves exceptions for collection activity and cases where the IRS officially finds the information necessary despite prior requests or the taxpayer's ability to provide it.
Introduced December 5, 2025 by W. Greg Steube · Last progress April 28, 2026