Congress to IRS: Do Not Compete in Tax Software

The Senate passed its fiscal 2006 funding provision for the IRS. A surprisingly contentious issue was an IRS attempt to provide free tax software (Free File) on its website. Sen. Ensign (R-NV) included a provision in the funding bill that prohibited the IRS from creating its own software and potentially competing with private tax software providers. Taxpayer Advocate Nina Olsen and several Democrats advocated providing free software on the IRS site. Another issue that came up was public release of an investigation on former HUD secretary Henry Cisneros. Senator Grassley (R-IA) argued that release should occur, as the investigation demonstrate several serious concerns about tax administration.