# Plain Language Summary: Tax Gap Reporting and IRS Audit Task Force Bill

This bill tackles a significant problem in the tax system: the "tax gap," which is the difference between the taxes people and businesses owe and what they actually pay. The bill requires the IRS to produce a detailed report explaining how big this gap is, where it's coming from, and what's causing it. Think of it like a financial health checkup—the government wants to understand exactly how much money it's losing because people aren't paying taxes they owe, whether through mistakes, aggressive tax strategies, or outright fraud.

The second major part of the bill creates a new fellowship program at the IRS to recruit experienced tax professionals from the private sector to work on a special audit task force. Instead of relying only on career IRS employees, this program brings in mid-career experts—people with real-world experience from law firms, accounting firms, and corporations—to help the IRS conduct more sophisticated audits. These professionals would work temporarily for the IRS, bringing their expertise to tackle complex tax cases that require specialized knowledge.

For most everyday taxpayers, this bill likely won't have an immediate direct impact on their taxes. However, it could matter in the long run. If the IRS successfully identifies and collects more unpaid taxes from high-income earners and large corporations, it could reduce the overall tax burden on regular workers. The bill essentially aims to level the playing field by making sure everyone pays what they owe, which could mean less pressure on middle-class taxpayers to make up the difference. The real effects will depend on whether the IRS actually uses this information and these new resources to pursue significant tax violators.

To require the Internal Revenue Service to issue a report on the tax gap, to establish a fellowship program within the Internal Revenue Service to recruit mid-career tax professionals to create and participate in an audit task force, and for other purposes.

Brady, Kevin

This bill requires the Internal Revenue Service (IRS) to report to Congress on projections of the estimated tax gap (i.e., the difference between tax liabilities owed to the IRS and those liabilities that the IRS actually collects). The IRS may use artificial intelligence and related data analysis tools to calculate a tax gap projection. The bill also requires the Joint Committee on Taxation to issue periodic reports to the congressional tax committees on the tax gap projection. The bill restricts IRS funding to FY2021 levels for audits and enforcement until it publishes an updated tax gap projection. Funding is also restricted for certain purposes, including (1) targeting U.S. citizens who exercise their First Amendment rights, (2) targeting a group for regulatory scrutiny based on its ideological beliefs, and (3) auditing individual taxpayers with an adjusted gross income of less than $400,000. The bill directs the IRS to establish a fellowship program to recruit private sector tax experts to join the IRS to create and participate in the audit task force. The purposes of the tax force include performing audit case selection, educating IRS employees on emerging issues, auditing selected taxpayers, addressing offshore tax evasion, and identifying, mentoring, and training IRS junior employees with respect to audits.