Title: National Taxpayer Advocate Enhancement Act of 2025
Bill Number: H.R. 997 (119th Congress)
Primary IRC Code Section Affected: 26 U.S.C. § 7803(c)(2)(D)(i)

Executive Summary & Legislative Status

On September 28, 2026, the United States Senate passed H.R. 997, the National Taxpayer Advocate Enhancement Act of 2025, by Unanimous Consent without amendment. This followed unanimous passage in the House of Representatives on March 31, 2025 by a roll call vote of 385–0 (Roll No. 85), following favorable reporting by the House Committee on Ways and Means (H. Rept. 119-46). The legislation has been cleared for enrolled print and sent to the President for signature.

Sponsored by Rep. Randy Feenstra (R-IA-4), H.R. 997 enacts targeted statutory amendments to Internal Revenue Code (IRC) § 7803. The primary purpose of the Act is to establish independent statutory authority for the National Taxpayer Advocate (NTA) to appoint dedicated legal counsel within the Taxpayer Advocate Service (TAS) who report directly to the NTA, thereby removing TAS legal personnel from the supervisory chain of the Treasury Legal Division and IRS Chief Counsel.

Detailed Statutory Amendments to the Internal Revenue Code

Section 2 of the Act amends IRC § 7803(c)(2)(D)(i) through three specific statutory modifications:

1. Appointment of Independent Counsel — IRC § 7803(c)(2)(D)(i)(II)

Section 2(a) amends IRC § 7803(c)(2)(D)(i) by striking “and” at the end of subclause (I), redesignating existing subclause (II) as subclause (III), and inserting a new subclause (II):

“(II) appoint counsel in the Office of the Taxpayer Advocate to report directly to the National Taxpayer Advocate, or delegate thereof; and”

2. Expansion of Personnel Action Authority — IRC § 7803(c)(2)(D)(i)(III)

Section 2(b) amends newly redesignated subclause (III) by striking “any employee of any local office of a taxpayer advocate described in subclause (I)” and inserting “any employee of the Office of the Taxpayer Advocate”.

This conforming change expands the NTA’s direct personnel and supervisory authority from local office staff to encompass all personnel employed within the Taxpayer Advocate Service nationwide.

Legislative Background & Historical Context

Overcoming Treasury Legal Division Centralization

Prior to this Act, Treasury Department administrative orders governed legal operations across all Treasury bureaus. Pursuant to these orders, all attorneys providing legal advice within the Department of the Treasury—including those supporting TAS—were organized under the Treasury Legal Division and under the ultimate supervision of the Treasury General Counsel and the IRS Chief Counsel.

Because TAS is an independent organization within the IRS tasked with advocating for taxpayers and challenging improper IRS administrative actions, relying on IRS Chief Counsel attorneys created an inherent structural conflict of interest. IRS Chief Counsel attorneys serve as legal advisors to IRS leadership and represent the Commissioner in litigation before the U.S. Tax Court.

Realizing the Mandate of RRA ’98

The preamble to H.R. 997 explicitly establishes that these amendments conform statutory text to the original legislative intent of Section 1102 of the Internal Revenue Service Restructuring and Reform Act of 1998 (RRA ’98, Public Law 105-206), as expressed in the Joint Explanatory Statement of the Committee of Conference accompanying Conference Report 105–599. RRA ’98 created the modern Taxpayer Advocate Service and intended for the NTA to operate with independent legal guidance, a vision restricted in practice by subsequent Treasury administrative frameworks.

Practical Impact on Tax Practice & IRS Administrative Representation

For CPAs, Enrolled Agents, and tax practitioners representing clients before the IRS, the passage of H.R. 997 provides several concrete operational benefits:

Unbiased Advocacy in Taxpayer Assistance Orders (TAOs): When practitioners petition for a Taxpayer Assistance Order under IRC § 7811 to relieve significant taxpayer hardship, TAS legal evaluations will now be conducted by counsel reporting exclusively to the NTA, free from IRS enforcement or litigating positions.
Enhanced Weight of NTA Directives & Reports: Independent legal analysis will strengthen Taxpayer Advocate Directives (TADs) and the statutory Annual Report to Congress, offering practitioners authoritative, objective legal interpretations of ambiguous Code sections and administrative procedures.
Protection of Taxpayer Rights: Independent TAS legal oversight reinforces the Taxpayer Bill of Rights (TBOR)—specifically the Right to Quality Service, the Right to Challenge the IRS’s Position and Be Heard, and the Right to a Fair and Just Tax System (IRC § 7803(a)(3)).

Effective Date & Retroactive Application

Under Section 2(c) of the Act, the statutory amendments to IRC § 7803 take effect retroactively as if included in the enactment of Section 1102 of the Internal Revenue Service Restructuring and Reform Act of 1998.

This retroactive effective date legally validates the independent legal status of the Office of the Taxpayer Advocate back to its foundational 1998 statutory mandate, harmonizing all past and future internal administrative operations of TAS.

Prepared with assistance from Gemini Notebook.