Small Tax Case Threshold Modernization Act

John Cornyn

Republican · TX · Senator

Source: Congress.gov · FEC

• Ben Ray Luján (D-NM)Original· 2026-07-22

Read twice and referred to the Committee on Finance.

2026-07-22

Source: Congress.gov

The proposal would change the dollar amount that determines whether a tax dispute qualifies as a "small case" in Tax Court, making it easier for individual taxpayers and small business owners to use the simplified small case procedure without needing a lawyer. Currently, only disputes under a certain threshold can use this faster, less formal process, and raising that threshold would allow more people to access it. This affects taxpayers who disagree with the IRS about how much tax they owe and want to challenge the decision in court.

AI-assisted summary generated from the official bill metadata (title, subjects, actions) sourced from Congress.gov. Cached and reviewed. Always verify against the official text linked below.

[Congressional Bills 119th Congress] [From the U.S. Government Publishing Office] [S. 5078 Introduced in Senate (IS)] <DOC> 119th CONGRESS 2d Session S. 5078 To amend the Internal Revenue Code of 1986 to adjust the threshold for conducting Tax Court proceedings relating to small disputes. _______________________________________________________________________ IN THE SENATE OF THE UNITED STATES July 22, 2026 Mr. Cornyn (for himself and Mr. Lujan) introduced the following bill; which was read twice and referred to the Committee on Finance _______________________________________________________________________ A BILL To amend the Internal Revenue Code of 1986 to adjust the threshold for conducting Tax Court proceedings relating to small disputes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE. This Act may be cited as the ``Small Tax Case Threshold Modernization Act''. SEC. 2. ADJUSTMENT OF THRESHOLD FOR SMALL DISPUTES. (a) In General.--Section 7463 of the Internal Revenue Code of 1986 is amended-- (1) by striking ``$50,000'' each place it appears in subsections (a) and (f) and inserting ``$100,000'', and (2) by adding at the end the following new subsection: ``(g) Inflation Adjustment.-- ``(1) In general.-- In the case of any petition or appeal filed in a calendar year beginning after 2026, each of the $100,000 amounts in subsections (a) and (f) shall be increased by an amount equal to-- ``(A) such dollar amount, multiplied by ``(B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year, determined by substituting `calendar year 2025' for `calendar year 2016' in subparagraph (A)(ii) thereof. ``(2) Rounding.--If any increase determined under paragraph (1) is not a multiple of $1,000, such increase shall be rounded to the next lowest multiple of $1,000.''. (b) Conforming Amendments.-- (1) The heading for section 7463 of such Code is amended by striking ``disputes involving $50,000 or less'' and inserting ``small disputes''. (2) The item relating to section 7463 in the table of section for part II of subchapter C of chapter 76 of such Code is amended by striking ``Disputes involving $50,000 or less'' and inserting ``Small disputes''. (c) Effective Date.--The amendments made by this section shall apply to proceedings commencing after the date of the enactment of this Act. <all>

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