This act was a direct response to public criticism of the IRS. It focuses on changing the culture and structure of the agency.
Key Themes
- Customer Service: Shifting the IRS mission to focus on serving taxpayers rather than just collecting revenue.
- Oversight: Creation of an independent Oversight Board to govern IRS administration.
- Taxpayer Rights: Expansion of rights in audits and collections (detailed in Part 2).
Investment Impact
A major provision for investors was the reduction of the holding period for long-term capital gains. The 1997 Act had extended it to 18 months, but the 1998 Act brought it back down to 12 months, retroactive to Jan 1, 1998.