On Wednesday, the House  passed a package of provisions designed to aid taxpayers, including language updating the tax treatment of employer-provided cell phones and other mobile devices.

In 1989, Congress added cell phones to the definition of” listed properties” and required employers to keep detailed logs of all employee calls, text messages, and emails in order to take a deduction. At the time, cell phones were viewed as a luxury perk for corporate executives. Cell phones, BlackBerries and other PDAs are viewed more commonly today as integral to daily business activities. IRS Commissioner Doug Shulman even said earlier this year that the Service had suspended any update of rules for taxing employer-provided cell phones and other mobile devices in expectation that Congress would soon change the antiquated law.

Legislation was introduced last session to remove cell phones from the listed property category, but Congress did not act on the bill.

Removing cell phones from listed property is estimated to cost $411 million over 10 years, and would be offset by provisions that increase the penalties for failing to file correct returns, failing to furnish correct pay statements, and failing to comply with other reporting requirements. Another revenue raiser in the bill would apply the penalty for writing bad checks or money orders to all commercially acceptable instruments of payment, including electronic payments.

In addition to the cell phone provision, the Taxpayer Assistance Act of 2010 would require the IRS to accelerate payment of interest on refunds for returns filed electronically; allow an exemption based on religious reasons from the electronic filing mandate; and help taxpayers enter into compromise agreements to settle their federal tax liabilities.

“This legislation helps taxpayers who are struggling in this economy by making it easier to enter into payment arrangements with the IRS,” said Ways and Means Oversight Subcommittee Chairman John Lewis (D-GA). “It also helps low-income taxpayers by improving IRS services available to them and helps small businesses and nonprofit organizations by relaxing the record keeping requirements for employer-provided cell phones.”