Monday, the bipartisan Barcode Automation for Revenue Collection to Organize Disbursement and Enhance (BARCODE) Efficiency Act (H.R. 6956), led by Congressman Rudy Yakym (R-IN-02) and Congressman Brad Schneider (D-IL-10), passed out of the House of Representatives and advances to the Senate.
The bill would require the IRS to use scanning technology to speed up paper return processing, save taxpayer dollars, and deliver refunds faster.
"The BARCODE Efficiency Act is a commonsense measure that modernizes our tax system," Rep. Yakym said. "By requiring scanning technology, this bill will help reduce errors, speed up processing, and save time for both taxpayers and the IRS. It's smart, efficient reform that strengthens service without adding unnecessary hoops."
“Many Americans have had to endure frustration and anxiety at the hands of the IRS bureaucracy when it comes to filing their taxes or waiting on their returns to be processed,” Ways and Means Committee Chairman Jason Smith (MO-08) said. “Having recently reformed our tax code through the Working Families Tax Cuts to provide more relief to working families, we should be modernizing our tax agency to get that relief to them as quickly as possible. The BARCODE Efficiency Act will streamline the tax filing process for millions of Americans and improve the IRS’s accuracy when processing paper returns and correspondence. As a key leader of the Ways and Means Committee’s oversight efforts, Representative Yakym has been a strong advocate for improving customer service at the IRS, and his legislation will ensure taxpayers get their returns in a more efficient and timely manner.”
Background:
Since launching an electronic filing pilot in 1986 and expanding it nationwide in 1990, IRS e-filing has grown to 155 million returns in 2025. Even so, millions of Americans still file on paper, including about 10.5 million paper returns last year. According to the Taxpayer Advocate Service's July 2025 report, while the 2025 filing season was largely successful, paper returns and correspondence continued to face processing delays, largely because of manual data entry. The report urged the IRS to modernize how it handles paper submissions to reduce backlogs.
Although Treasury can set standards for machine-readable tax forms, current law prevents it from requiring individuals, estates, and trusts to file returns in any format other than paper. As a result, the IRS still spends significant time and resources manually entering data from paper filings.
H.R. 6956, the BARCODE Efficiency Act, would require the IRS to acquire scanning technology to process tax returns prepared electronically, as well as handwritten returns and paper correspondence. Together, these changes would speed up processing, reduce errors, cut backlogs, and free IRS staff to focus more on customer service and other critical needs.
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