IRS Overhaul Plan Gets House Panel’s Approval

With its path suddenly smoothed by White House support, a bill that promises the most far-reaching changes in the Internal Revenue Service in more than 40 years was quickly and decisively approved Wednesday by the House’s tax-writing committee.

On a 33-4 vote, the Ways and Means Committee passed the bill that would create an 11-member board, mostly of private citizens, to oversee the IRS. The vote was boosted by the Clinton administration’s decision a day earlier to give up its more-modest proposal and embrace the measure.

The legislation also aims at strengthening taxpayers’ rights in disputes with the IRS. One major change would shift the burden of proof in court proceedings from the taxpayer to the IRS, so long as the taxpayer cooperates with investigating IRS auditors or agents. Other provisions protect “innocent spouses” from IRS prosecution for tax problems caused by former husbands or wives.

The bill is expected to pass the House before lawmakers adjourn next month, but in the Senate, the outlook remains unclear.

Senate Finance Committee Chairman William V. Roth Jr. (R-Del.) said he intends to hold hearings on the bill next week but ruled out final action this year.