Cox Bill Would Expand Timely Filing Rules.

Rep. C. Christopher Cox, R-Calif., has introduced H.R. 3086, which would designate qualified delivery services, in addition to the U.S. Postal Service, for purposes of determining timely filing tax documents with the IRS. Cox's bill would allow the Secretary of the Treasury to include qualified private delivery services in the timely- mailing-as-timely-filing rules.

Cox placed in the Record a letter he received from former IRS Commissioner Fred T. Goldberg, who endorsed his legislation. House Ways and Means Committee members Nancy L. Johnson, R-Conn., Wally Herger, R-Calif., and Philip M. Crane, R-Ill., cosponsored the bill.

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THE FAST AND EFFICIENT TAX FILING ACT

IN THE HOUSE OF REPRESENTATIVES

Thursday, March 14, 1996

Mr. COX of California. Mr. Speaker, many Government rules and regulations now on the books are obsolete and just plain burdensome. Today, with bipartisan support, and in behalf of taxpayers across the Nation, I am introducing the Fast and Efficient Tax Filing Act to correct one of these obsolete regulations.

Every April 15, thousands of Americans nationwide wait in long lines at the U.S. Postal Service to mail their tax returns and receive their registered mail receipts which prove that their documents were mailed on time. So even though the tax documents might arrive at the Internal Revenue Service 2 or 3 days after the due date, it is counted as being delivered on the date of the registered mail receipt. This is a good rule -- it gives taxpayers peace of mind that they will not be fined or penalized if the Postal Service takes longer than expected to deliver the documents.

However, like so many other things, the devil is in the details. This timely-mailing-as-timely-filing rule applies only to documents delivered by the U.S. Postal Service. So if the same taxpayer sent his or her tax documents on the due date via Federal Express, United Parcel Service, or some other reliable private delivery service, the timely-mailing-as-timely-filing rule would not apply, and the tax documents would be considered officially late.

The timely-mailings-as-timely-filing rule was written at a time when only the U.S. Postal Service delivered mail. Today, it doesn't make any sense to limit the timely-mailing-as-timely-filing provision just to documents delivered by the U.S. Postal Service when many alternative methods are much more reliable and quicker.

The Fast and Efficient Tax Filing Act will correct this inequity by permitting the Secretary of the Treasury to expand the timely-mailing-as-timely-filing rule to include qualified private delivery services. This would both increase the efficiency of the IRS and make it easier for taxpayers to file their tax returns on time.

Mr. Speaker, I ask unanimous consent to introduce into the Record letters of endorsement for the Fast and Efficient Tax Filing Act from the National Taxpayers Union, the United Parcel Service, and even from a former IRS Commissioner.

I invite my colleagues to cosponsor this important bill, so that we may make life a bit easier for millions of American taxpayers.

National Taxpayers Union,

Hon. Christopher Cox,

Dear Congressman Cox: The 300,000-member National Taxpayers Union strongly supports your Fast and Efficient Tax Filing Act, which would permit the Secretary of the Treasury to designate qualified delivery services for purposes of timely filing of tax documents with the Internal Revenue Service and Tax Court.

Many aspects of the Internal Revenue Code and its enforcement seem outmoded and inconsistent, but few are as archaic as the policy on the filing of tax documents. Few taxpayers are aware of the fact that the IRS will only accept a receipt from the U.S. Postal Service as evidence that a document was delivered to the tax agency on time. Every year many citizens have been placed in financial peril simply because they made a reasonable assumption that a receipt from a delivery service was adequate.

With the onset of the Information Age, many national delivery services have proven to be more reliable than the U.S. Postal Service. Indeed, private companies from law firms to financial industries often entrust Federal Express, United Parcel Service, and many others to quickly deliver documents upon which their livelihoods depend. Yet, current IRS policy forces taxpayers to patronize the postal monopoly.

Your legislation would also make the filing of important documents more convenient for taxpayers who do not have easy access to a Post Office, or do not have time to wait in long lines for Registered Mail receipts. Private delivery firms can provide the personalized, door-to-door service many citizens prefer.

A federal appeals court in San Francisco recently upheld a lower court ruling that the judicial branch cannot compel the IRS to recognize the receipts of reputable delivery services. According to the ruling, while a taxpayer may "put forth what may be a legitimate policy rationale for extending the rule to private delivery services, it is for Congress, not the courts, to make such a change."

For this reason, taxpayers are now looking to Congress to remove this onerous and pointless compliance burden. Congress should modernize the tax filing law by enacting the Fast and Efficient Tax Filing Act.

Sincerely,

David Keating,

* * *

United Parcel Service,

Washington, DC, March 13, 1996.

Hon. Christopher Cox,

Dear Congressman Cox: United Parcel Service (UPS) strongly supports passage of the "Fast Efficient Tax Filing Act" with its goal of expanding the current timely-filing rule to include private companies. The bill would not only allow the Internal Revenue Service (IRS) to receive important documents as promptly as possible but would provide the flexibility to UPS customers to file their tax documents through a carrier of their choosing.

The information age has brought about a transformation in the way business is conducted. Consumers are continuously looking for new choices to meet their constantly changing needs. UPS alone has over 1.3 million daily pick-up customers and delivers nearly 12 million parcels and documents on a daily basis.

Private companies such as UPS present convenient and more reliable alternatives to the Postal Service. UPS offers time definite express services which would ensure the timely filing of tax documents with the IRS. In addition, UPS has the infrastructure and technology to track vital documents through its system to the final destination. These are the types of services taxpayers are looking for when dealing with the IRS.

The current IRS policy requires taxpayers to patronize the Postal Service when filing their tax returns. This is not only inconvenient for those who do not have easy access to a Post Office, but it unfairly treats private sector companies by creating an unlevel playing field between the Postal Service and its competitors.

A federal appeals court in San Francisco recently ruled that there is a legitimate policy rationale for extending the timely-mailing-as-timely-filing rule to private delivery companies but left the matter up to Congress to resolve. The time is ripe for reforming this unfair rule which does not serve the needs of society. On behalf of all taxpayers, we urge Congress to pass the Fast and Efficient Tax filing Act.

Sincerely,

Arnie Wellman,

* * *

Skadden, Arps, Slate,

Washington, DC, March 14, 1996.

Hon. Christopher Cox,

Re: Fast and Efficient Tax Filing Act

Dear Congressman Cox: As a former IRS Commissioner, as a tax practitioner, and as a taxpayer, I enthusiastically support your proposed Fast and Efficient Tax Filing Act. The change is long overdue -- I only wish I had focused on the issue and taken the step administratively while I was at the IRS!

Your proposal embodies the kind of real world, common sense legislation that the tax system so desperately needs. While the courts in Correia applied the law correctly, these are precisely the situations that drive people up the wall and destroy their confidence in government. You should be applauded for your ongoing efforts to make the system work better for citizens and taxpayers. If there is ever anything I can do to lend a hand, please let we know.

Sincerely,

Fred R. Goldberg, Jr.