[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2428 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                H. R. 2428

   To improve the operations and governance of the Internal Revenue 
                    Service, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 8, 1997

  Mr. Rangel (for himself, Mr. Coyne, Mr. Hoyer, Mr. Waxman, and Mr. 
   Matsui) introduced the following bill; which was referred to the 
   Committee on Ways and Means, and in addition to the Committee on 
   Government Reform and Oversight, for a period to be subsequently 
   determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
   To improve the operations and governance of the Internal Revenue 
                    Service, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; AMENDMENT OF THE 1986 CODE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Internal Revenue 
Service Improvement Act of 1997''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.
    (c) Table of Contents.--

Sec. 1. Short title; amendment of the 1986 Code; table of contents.
Sec. 2. Findings and purposes.
         TITLE I--IMPROVEMENTS IN IRS MANAGEMENT AND OVERSIGHT

Sec. 101. Five-year term for IRS Commissioner.
Sec. 102. Institutionalized executive branch oversight of the IRS; 
                            outside advice for the Secretary of the 
                            Treasury.
Sec. 103. Assistant Commissioner (Customer Service).
Sec. 104. Additional duties for the Taxpayer Advocate.
        TITLE II--IMPROVING THE EFFICIENCY OF TAX ADMINISTRATION

Sec. 201. Promotion of electronic tax administration.
Sec. 202. Cooperative agreements with State tax authorities.
          TITLE III--PROVIDING FLEXIBILITY FOR IRS MANAGEMENT

Sec. 301. Improvements in personnel flexibilities.
Sec. 302. Authorization for appropriations.
Sec. 303. Internal Revenue Service funding.

SEC. 2. FINDINGS AND PURPOSES.

    (a) The Congress finds that:
            (1) The taxpayer would benefit from greater continuity in 
        IRS leadership and oversight.
            (2) The enhanced oversight of the IRS by the Secretary of 
        the Treasury needs to be institutionalized.
            (3) While the IRS has made considerable improvement in 
        recent years, customer service at the IRS continues to lag 
        behind the level of service the American people receive from 
        the best private sector organizations. The IRS should adopt the 
        best customer service practices of the private sector, 
        consistent with the IRS's overall mission of collecting the tax 
        revenues which are due.
            (4) The taxpayer needs IRS to continue to improve its use 
        of technology for the benefit of American taxpayers and the 
        IRS.
            (5) The Secretary of the Treasury, the IRS and the taxpayer 
        would benefit from increased private sector advice regarding 
        technology, customer service, and modern management techniques.
            (6) The IRS Taxpayer Advocate should be given additional 
        responsibilities and independence to represent American 
taxpayers within the IRS.
            (7) There should be increased use of electronic filing for 
        income tax returns and information reporting.
            (8) The taxpayer needs IRS to have greater flexibility to 
        attract and retain high caliber personnel and to manage its 
        human resources in ways that fit its organizational needs.
            (9) The taxpayer needs IRS to have adequate and stable 
        funding and budgeting to ensure continuity in its effort to 
        improve its performance.
            (10) Improved cooperation between the IRS and State tax 
        authorities can reduce overall taxpayer burden and improve the 
        efficiency of tax collection.
    (b) The purposes of this Act are:
            (1) To provide greater continuity in Internal Revenue 
        Service leadership.
            (2) To enhance and institutionalize the oversight of the 
        IRS by the Secretary of the Treasury.
            (3) To ensure that taxpayers receive fair, impartial, 
        timely, and courteous treatment from the Internal Revenue 
        Service, consistent with the overall IRS mission of collecting 
        taxes that are due.
            (4) To ensure that the Secretary of the Treasury and the 
        IRS have the benefit of private sector advice regarding 
        technology, customer service, and modern management techniques.
            (5) To provide additional independence to the IRS Taxpayer 
        Advocate to represent American taxpayers within the IRS.
            (6) To establish the goal of paperless filing as the 
        preferred and most convenient means of filing tax returns for 
        the vast majority of taxpayers.
            (7) To enable the Internal Revenue Service to recruit and 
        retain a first-class workforce that will be rewarded for 
        performance and held accountable for working with taxpayers to 
        solve problems.
            (8) To improve cooperation between the Internal Revenue 
        Service and State taxing authorities to reduce overall taxpayer 
        burdens and improve the efficiency of tax collection.

         TITLE I--IMPROVEMENTS IN IRS MANAGEMENT AND OVERSIGHT

SEC. 101. FIVE-YEAR TERM FOR IRS COMMISSIONER.

    (a) In General.--Section 7802(a) is amended to read as follows:
    ``(a) Commissioner of Internal Revenue.--There shall be in the 
Department of the Treasury a Commissioner of Internal Revenue, who 
shall be appointed by the President, by and with the advice and consent 
of the Senate, for a term of five years. The Commissioner of Internal 
Revenue shall have such duties and powers as may be prescribed by the 
Secretary of the Treasury.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to individuals appointed after the date of the enactment of this 
Act.

SEC. 102. INSTITUTIONALIZED EXECUTIVE BRANCH OVERSIGHT OF THE IRS; 
              OUTSIDE ADVICE FOR THE SECRETARY OF THE TREASURY.

    Section 7801 is amended to read as follows:

``SEC. 7801. AUTHORITY OF THE DEPARTMENT OF THE TREASURY.

    ``(a) Powers and Duties of the Secretary.--Except as otherwise 
expressly provided by law, the administration and enforcement of this 
title shall be performed by or under the supervision of the Secretary 
of the Treasury.
    ``(b) Internal Revenue Service Management Board.--
            ``(1) There shall be within the Department of the Treasury 
        an Internal Revenue Service Management Board (Management Board) 
        which shall consist of career and non-career employees, 
        including--
                    ``(A) the Deputy Secretary of the Treasury, who 
                shall serve as Chair of the Board;
                    ``(B) the Assistant Secretary of the Treasury 
                (Management), who shall serve as Vice-Chair;
                    ``(C) the Commissioner of Internal Revenue;
                    ``(D) the Deputy Commissioner of Internal Revenue;
                    ``(E) the Assistant Secretary of the Treasury (Tax 
                Policy);
                    ``(F) the Chief Information Officer of the 
                Department of the Treasury;
                    ``(G) the Chief Information Officer of the Internal 
                Revenue Service;
                    ``(H) the General Counsel of the Treasury;
                    ``(I) the Chief Counsel of the Internal Revenue 
                Service;
                    ``(J) the Taxpayer Advocate of the Internal Revenue 
                Service;
                    ``(K) a representative of the Office of Management 
                and Budget designated by the Director of such office;
                    ``(L) a representative of an organization that 
                represents a substantial number of Internal Revenue 
                Service employees designated by the Secretary;
                    ``(M) representatives of other government agencies, 
                with specific expertise relevant to the issues faced by 
                the Internal Revenue Service, as may be determined from 
                time to time by the Secretary of the Treasury, 
                designated by the head of such agency;
                    ``(N) such other officers or employees of the 
                Department of the Treasury as may be designated by the 
                Secretary; and
                    ``(O) such other individuals as may be designated 
                by the Secretary.
            ``(2) A member of the Management Board described in 
        paragraph (1) may be removed by the Secretary or the official 
        who designated such member.
            ``(3) There shall be an Executive Committee of the 
        Management Board, the members of which shall be appointed by 
        the Secretary.
            ``(4) The Management Board shall support directly the 
        Secretary's oversight of the management and operation of the 
        Internal Revenue Service pursuant to subsection (a), 
        including--
                    ``(A) working through the Deputy Secretary, 
                assisting the Secretary on high-level management issues 
                and concerns affecting the Internal Revenue Service, 
particularly those that have a significant impact on taxpayer 
assistance, communications and filings, customer service, operations 
and modernization, and in the review of performance plans and 
accomplishments of senior Internal Revenue Service officials; and
                    ``(B) acting through the Executive Committee, 
                serving as the primary review body for strategic 
                decisions concerning modernization of the Internal 
                Revenue Service and tax administration, including 
                modernization direction, strategy, recurring systemic 
                problems affecting taxpayers, significant 
                reorganization plans, performance metrics, budgetary 
                issues, major capital investments, procurement of 
                property and services, and compensation of personnel.
        The Secretary also may appoint committees composed of 
        Management Board members and others to provide advice on 
        particular issues.
            ``(5) The Management Board shall meet at least monthly and 
        shall prescribe such by-laws or procedures as the Management 
        Board deems appropriate.
            ``(6) The Management Board shall prepare semi-annual 
        reports to the President and the Congress describing the 
        matters considered, and the conclusions reached, by the 
        Management Board, which shall be transmitted by the Secretary 
        of the Treasury.
            ``(7) The Secretary of the Treasury shall provide the 
        Management Board with career staff whose responsibility shall 
        be to provide support to the Management Board, administrative 
        services, facilities, expert and consultative services, and 
        such financial support as may be necessary for the performance 
        of its functions.
            ``(8) The provisions of the Federal Advisory Committee Act 
        (5 U.S.C. App. 2) shall not apply to the Management Board.
    ``(c) Internal Revenue Service Advisory Board.--
            ``(1) The Secretary of the Treasury shall establish an 
        advisory committee known as the `Internal Revenue Service 
        Advisory Board' (Advisory Board).
                    ``(A) The Advisory Board shall be composed of up to 
                14 members appointed by the Secretary from the private 
                sector, including individuals with expertise in: 
                customer service, taxpayer advocacy, technology, 
                operating large and small businesses, operating non-
                profit organizations, operating educational 
                organizations, the Internal Revenue Code, tax 
                preparation, and state tax administration. Appointments 
                shall be made without regard to political affiliation.
                    ``(B) The Secretary shall designate an Advisory 
                Board member as Chairperson of the Advisory Board.
                    ``(C) Advisory Board members shall be appointed for 
                three-year terms. With respect to the initial 
                appointments, however, the Secretary shall select, on a 
                representative basis to the maximum extent practicable, 
                no more than five of the members to serve three-year 
                terms, no more than five of the members to serve two-
                year terms, and no more than four members to serve one-
                year terms. The Secretary may reappoint an Advisory 
                Board member whose term has expired.
                    ``(D) Any vacancy on the Advisory Board shall be 
                filled by the Secretary for the remainder of the 
                original term. Any Advisory Board member whose term has 
                expired may continue to serve until a successor is 
                appointed.
                    ``(E) Any Advisory Board member may be removed at 
                the discretion of the Secretary.
            ``(2) The Advisory Board shall advise the Secretary and the 
        Management Board on the management and operation of the 
        Internal Revenue Service, including ways to improve and 
        modernize the Internal Revenue Service and enhance the fairness 
        of the administration of the Internal Revenue Code.
            ``(3) The Advisory Board shall meet at the call of the 
        Chair, but not less than four times per year, and shall submit 
        to the Secretary and the Management Board a report regarding 
        each such meeting.
            ``(4) At the request of the Chair or Vice Chair of the 
        Management Board, the Advisory Board may meet with and provide 
        advice directly to the Management Board.
            ``(5) The Advisory Board shall prepare an Annual Report to 
        Taxpayers, which the Secretary shall submit to Congress not 
        later than June 30 of each year.
            ``(6) The provisions of the Federal Advisory Committee Act 
        (5 U.S.C. App. 2) shall apply to the Advisory Board, except 
        that--
                    ``(A) The Advisory Board shall function for such 
                period as may be necessary, and section 14 of such Act 
                (relating to termination of advisory committees after 
                two years) shall not apply to the Advisory Board; and
                    ``(B) The requirements of sections 10(a) and (b) 
                and section 11 of such Act (relating to open meetings, 
                public notice, public participation, and public 
                availability of documents) shall not apply to the 
                Advisory Board to the extent the Secretary determines 
                that the disclosure of the Advisory Board's discussions 
                would compromise the Advisory Board's ability to 
                provide candid advice or otherwise would be 
                inappropriate.
            ``(7) Members of the Advisory Board shall not be paid for 
        their time or services. While attending Advisory Board meetings 
        or otherwise engaging in its business, Advisory Board members 
        shall be reimbursed for their travel expenses as authorized by 
        section 5703 of title 5, United States Code. The Secretary 
        shall furnish the Advisory Board with necessary staff and 
        support services.
    ``(d) Reporting to Congress.--The Secretary and the Deputy 
Secretary shall annually--
            ``(1) submit a report to the Congress on their stewardship 
        of the Internal Revenue Service, and
            ``(2) appear together before an appropriate committee of 
        the House of Representatives and an appropriate committee of 
        the Senate to report on such stewardship.
    ``(e) Functions of Department of Justice Unaffected.--Nothing in 
this section or section 301(f) of title 31 shall be considered to 
affect the duties, powers, or functions imposed upon, or vested in, the 
Department of Justice, or any officer thereof, by law existing on May 
10, 1934.''.

SEC. 103. ASSISTANT COMMISSIONER (CUSTOMER SERVICE).

    (a) Assistant Commissioner (Customer Service).--Section 7802(c) is 
amended to read as follows:
    ``(c) Assistant Commissioner (Customer Service).--There is 
established within the Internal Revenue Service an office to be known 
as the `Office for Customer Service' to be under the supervision and 
direction of an Assistant Commissioner of Internal Revenue. The 
Assistant Commissioner shall be responsible for all taxpayer 
assistance, information and education.''.
    (b) Conforming Amendment.--Section 6235 of the Technical and 
Miscellaneous Revenue Act of 1988 is amended by deleting subsection (b) 
and redesignating subsection (c) as subsection (b).

SEC. 104. ADDITIONAL DUTIES FOR THE TAXPAYER ADVOCATE.

    Section 7802(d) is amended to read as follows:
    ``(d) Office of Taxpayer Advocate.--
            ``(1) In general.--
                    ``(A) There is established in the Internal Revenue 
                Service an office to be known as the `Office of the 
                Taxpayer Advocate'. Such office shall be under the 
                supervision and direction of an official to be known as 
                the Taxpayer Advocate' who shall be appointed by and 
                report directly to the Commissioner of Internal 
                Revenue. The Taxpayer Advocate may be compensated at a 
                level up to the same rate as the highest level official 
                reporting directly to the Deputy Commissioner of 
                Internal Revenue.
                    ``(B) As a qualification for appointment as the 
                Taxpayer Advocate, an individual must have knowledge of 
                the working of tax administration systems, experience 
                representing taxpayers before the Internal Revenue 
                Service, or experience with taxpayer rights issues.
                    ``(C) An individual who, before being appointed as 
                the Taxpayer Advocate, was an officer or employee of 
                the Internal Revenue Service may be so appointed only 
                if such individual agrees not to accept any employment 
                with the Internal Revenue Service for a period of five 
                years after ceasing to be the Taxpayer Advocate.
            ``(2) Functions of office.--
                    ``(A) In general.--It shall be the function of the 
                Office of Taxpayer Advocate to--
                            ``(i) assist taxpayers in resolving 
                        problems with the Internal Revenue Service,
                            ``(ii) identify areas in which taxpayers 
                        have problems in dealings with the Internal 
                        Revenue Service,
                            ``(iii) to the extent possible, proposed 
                        changes in the administrative practices of the 
                        Internal Revenue Service to mitigate problems 
                        identified under clause (ii), and
                            ``(iv) identify potential legislative 
                        changes which may be appropriate to mitigate 
                        such problems.
                    ``(B) Annual reports.--
                            ``(i) Objectives.--Not later than June 30 
                        of each calendar year, the Taxpayer Advocate 
                        shall report to the Committee on Ways and Means 
                        of the House of Representatives and the 
                        Committee on Finance of the Senate on the 
                        objectives of the Taxpayer Advocate for the 
                        fiscal year beginning in such calendar year. 
                        Any such report shall contain full and 
                        substantive analysis, in addition to 
                        statistical information.
                            ``(ii) Activities.--Not later than December 
                        31 of each calendar year, the Taxpayer Advocate 
                        shall report to the Committee on Ways and Means 
                        of the House of Representatives and the 
                        Committee on Finance of the Senate on the 
                        activities of the Taxpayer Advocate during the 
                        fiscal year ending during such calendar year. 
                        Any such report shall contain full and 
                        substantive analysis, in addition to 
                        statistical information, and shall--
                                    ``(I) identify the initiatives the 
                                Taxpayer Advocate has taken on 
                                improving taxpayer services and 
                                Internal Revenue Service 
                                responsiveness,
                                    ``(II) contain 
recommendations received from individuals with the authority to issue 
Taxpayer Assistance Orders under section 7811,
                                    ``(III) contain a summary of at 
                                least 20 of the most serious problems 
                                encountered by taxpayers, including a 
                                description of the nature of such 
                                problems,
                                    ``(IV) contain an inventory of the 
                                items described in subclauses (I), 
                                (II), and (III) for which action has 
                                been taken and the result of such 
                                action,
                                    ``(V) contain an inventory of the 
                                items described in subclauses (I), 
                                (II), and (III) for which action 
                                remains to be completed and the period 
                                during which each item has remained on 
                                such inventory,
                                    ``(VI) contain an inventory of the 
                                items described in subclauses (I), 
                                (II), and (III) for which no action has 
                                been taken, the period during which 
                                each item has remained on such 
                                inventory, the reasons for the 
                                inaction, and identify any Internal 
                                Revenue Service official who is 
                                responsible for such inaction,
                                    ``(VII) identify any Taxpayer 
                                Assistance Order which was not honored 
                                by the Internal Revenue Service in a 
                                timely manner, as specified under 
                                section 7811(b),
                                    ``(VIII) contain recommendations 
                                for such administrative and legislative 
                                action as may be appropriate to resolve 
                                problems encountered by taxpayers,
                                    ``(IX) describe the extent to which 
                                regional taxpayer advocates participate 
                                in the selection and evaluation of 
                                local taxpayer advocates,
                                    ``(X) identify areas of the tax law 
                                that impose significant compliance 
                                burdens on taxpayers or the Internal 
                                Revenue Service, including specific 
                                recommendations for remedying these 
                                problems,
                                    ``(XI) contain a list supplied by 
                                the National Director of Appeals which 
                                identifies the 10 most litigated issues 
                                for various categories of taxpayers 
                                (e.g., individuals, self-employed 
                                individuals, and small businesses), 
                                including recommendations for 
                                mitigating such disputes, and
                                    ``(XII) include such other 
                                information as the Taxpayer Advocate 
                                may deem advisable.
                            ``(iii) Report to be submitted directly.--
                        Each report required under this subparagraph 
                        shall be provided directly by the Committees 
                        described in clauses (i) and (ii) without any 
                        prior review of comment from the Commissioner, 
                        the Secretary of the Treasury, any other office 
                        or employee of the Department of the Treasury, 
                        or the Office of Management and Budget.
                    ``(C) Other responsibilities.--The Taxpayer 
                Advocate also shall--
                            ``(i) monitor the coverage and geographic 
                        allocation of taxpayer advocates,
                    ``(ii) develop guidance to be distributed to all 
                Internal Revenue Service officers and employees 
                outlining the criteria for referral of taxpayer 
                inquiries to taxpayer advocates,
                    ``(iii) ensure that taxpayers have direct access to 
                the problem resolution program through a dedicated 
                telephone number, and
                    ``(iv) in conjunction with the Commissioner, 
                develop career paths for taxpayer advocates choosing to 
                make a career in the Office of the Taxpayer Advocate.
            ``(3) Responsibilities of commissioner.--The Commissioner 
        of Internal Revenue shall establish procedures requiring a 
        formal response to all recommendations submitted to the 
        Commissioner by the Taxpayer Advocate within three months after 
        submission to the Commissioner.''.

        TITLE II--IMPROVING THE EFFICIENCY OF TAX ADMINISTRATION

SEC. 201. PROMOTION OF ELECTRONIC TAX ADMINISTRATION.

    (a) Promotion of Electronic Filing; Facilitating the Filing of 
Electronic Returns.--Section 6011 is amended by adding the following 
new subsections:
    ``(g) Promotion of Electronic Filing.--Notwithstanding any other 
law, the Secretary is authorized to promote the benefits of and 
encourage the use of electronic tax administration programs, as they 
become available, through the use of mass communications and other 
means.
    ``(h) Incentive Payments.--Notwithstanding any other provision of 
law, amounts appropriated to the Internal Revenue Service may be used 
by the Secretary to encourage the expanded use of electronic means to 
file returns and other documents.
    ``(i) Alternatives to Attaching Documents to Returns.--If any 
section of this title requires a statement or information supporting a 
return, the Secretary may prescribe the method of submitting the 
statement or information.''.
    (b) Authority To Waive Signature Requirements or Prescribe 
Alternative Methods of Verifying Returns.--
            (1) In general.--Part IV of subchapter A of chapter 61 is 
        amended by adding at the end the following new section:

``SEC. 6066. AUTHORITY TO WAIVE SIGNATURE REQUIREMENTS OR PRESCRIBE 
              ALTERNATIVE METHODS OF VERIFYING RETURNS.

    ``(a) Authority.--The Secretary may waive the requirement of a 
signature for all returns or classes of returns, or may provide for 
alternative methods of subscribing all returns, declarations, 
statements, or other documents required or permitted to be made or 
written under internal revenue laws and regulations.
    ``(b) Treatment of alternative methods.--Notwithstanding any other 
provision of law, any return, declaration, statement or other document 
filed without signature under the authority of this section or 
verified, signed or subscribed under any method adopted under 
subsection (a) shall be treated for all purposes (both civil and 
criminal, including penalties for perjury) in the same manner as though 
signed and subscribed. Any such return, declaration, statement or other 
document shall be presumed to have been actually submitted and 
subscribed by the person on whose behalf it was submitted.
    ``(c) Published Guidance.--The Secretary shall publish guidance as 
appropriate to define and implement any waiver of the signature 
requirements.''
            (2) Clerical amendment.--The table of sections for part IV 
        of subchapter A of chapter 61 is amended by inserting after the 
        item relating to section 6065 the following new item:

        ``Sec. 6066. Authority to waive signature requirements or 
                  prescribe alternative methods of verifying returns.''.
    (c) Acknowledgment of Electronic Filing.--Section 7502(c) is 
amended to read as follows:
    ``(c) Registered and Certified Mailing; Electronic Filing.--
            ``(1) Registered mail.--For purposes of this section, if 
        any return, claim, statement, or other document, or payment, is 
sent by United States registered mail--
                    ``(A) such registration shall be prima facie 
                evidence that the return, claim, statement, or other 
                document was delivered to the agency, officer, or 
                office to which addressed; and
                    ``(B) the date of registration shall be deemed the 
                postmark date.
            ``(2) Certified mail; electronic filing.--The Secretary is 
        authorized to provide by regulations the extent to which the 
        provisions of paragraph (1) of this subsection with respect to 
        prima facie evidence of delivery and the date shall apply to 
        certified mail and electronic filing.''.

SEC. 202. COOPERATIVE AGREEMENTS WITH STATE TAX AUTHORITIES.

    (A) In General.--Chapter 77 (relating to miscellaneous provisions) 
is amended by adding after section 7524 the following new section:

``SEC. 7525. TAX ADMINISTRATION AGREEMENTS.

    ``(a) In General.--To the extent provided in regulations, the 
Secretary is authorized to enter into tax administration agreements 
with any State agency, body, or commission described in section 
6103(d)(1). Under such agreements, the Secretary may delegate powers 
relating to the administration of this title to officers and employees 
of such State agency, body, or commission, only if such officers and 
employees in exercising such powers are under the supervision of the 
Secretary.
    ``(b) Tax Administration Agreement Defined.--A tax administration 
agreement is a written agreement entered into by the Secretary and a 
State agency, body, or commission described in section 6103(d)(1) that 
provides for a delegation of tax administration powers or a payment of 
reasonable compensation for activities conducted by either party to the 
agreement. Each Federal or State tax administration power to be 
exercised pursuant to a tax administration agreement shall be performed 
in accordance with the terms of the agreement to the extent such terms 
do not conflict with the Federal or State laws that otherwise authorize 
the respective tax administration function.
    ``(c) Judicial Proceedings.--
            ``(1) Review by the united states courts.--Nothing in this 
        subchapter shall give any court of the United States any 
        additional jurisdiction nor diminish its jurisdiction.
            ``(2) Prohibition of review by the state courts.--No court 
        or other tribunal of any State shall have jurisdiction to 
        adjudicate in any action, legal or equitable, the validity or 
        scope of an assessment of an internal revenue tax that is the 
        subject of a tax administration agreement.
            ``(3) Limitation on personal jurisdiction.--No court or 
        other tribunal of any State shall have jurisdiction over an 
        individual who exercises Federal tax administration powers 
        pursuant to a tax administration agreement for actions relating 
        to the exercise of those powers.
    ``(d) Payment for Services.--The Secretary is authorized to pay 
reasonable compensation for activities conducted by a State pursuant to 
a tax administration agreement. The Secretary is authorized to collect 
reasonable compensation for activities conducted by the United States 
pursuant to a tax administration agreement.
    ``(e) Availability of Funds.--Any funds appropriated for purposes 
of the administration of this title shall be available for purposes of 
carrying out the Secretary's responsibilities under a tax 
administration agreement. Any reasonable compensation received pursuant 
to a tax administration agreement shall be credited to the amounts so 
appropriated and shall remain available to the Internal Revenue Service 
until expended to supplement appropriations made available to the 
appropriations accounts in the fiscal year during which this provision 
is enacted and all fiscal years thereafter.
    ``(f) Tax Treaties and Other International Agreements.--To the 
extent the provisions of this subchapter or a tax administration 
agreement may conflict with the terms of any tax treaty, or other 
international agreement of the United States containing provisions 
relating to taxation or the administration of tax laws, the terms of 
the treaty or international agreement shall control.
    ``(g) Employee Status.--Any officer or employee of the United 
States acting pursuant to a tax administration agreement shall be 
deemed to remain a Federal employee. Except as otherwise expressly 
provided by the laws of the United States, any officer or employee of a 
State acting pursuant to a tax administration agreement shall be deemed 
to remain a State employee.''
    (b) Conforming Amendments.--
            (1) Section 6103(d) is amended--
                    (A) by amending paragraph (1) to read as follows:
            ``(1)(A) In General.--Returns and return information with 
        respect to taxes imposed by chapters 1, 2, 6, 11, 12, 21, 23, 
        24, 31, 32, 44, 51, and 52 and subchapter D of chapter 36 shall 
        be open to inspection by, or disclosure to, any State agency, 
        body, or commission, or its legal representative, which is 
        charged under the laws of such State with the responsibility 
        for the administration of State tax laws for the purpose of, 
        and only to the extent necessary in--
                    ``(i) the administration of such laws, including 
                any procedures with respect to locating, any person who 
                may be entitled to a refund; or
                    ``(ii) the administration of Federal tax laws 
                pursuant to a tax administration agreement entered into 
                between such agency, body or commission and the 
                Secretary under section 7525.
            ``(B) Written request by agency head required for 
        disclosure.--The inspection of returns and return information 
        under this paragraph shall be permitted, or disclosure of such 
        returns and return information made, only upon written request 
        by the head of such agency, body, or commission, and only to 
        the representatives of such agency, body, or commission 
        designated in such written request as the individuals who are 
        to inspect or receive the returns or return information on 
        behalf of such agency, body, or commission.
            ``(C) Permissible recipients.--The representatives of such 
        agency, body, or commission to whom disclosure is permitted 
        under this paragraph shall include only employees or legal 
        representatives of such agency, body, or commission, or a 
        person described in subsection (n) of this section. However, 
        notwithstanding the foregoing, disclosure shall not be 
        permitted to any individual who is the chief executive officer 
        of such State.
            ``(D) Confidential informants; impairment of 
        investigations.--Return information shall not be disclosed 
        under this paragraph to the extent that the Secretary 
        determines that such disclosure would identify a confidential 
        informant or seriously impair any civil or criminal tax 
        investigation.''; and
                    (B) by adding at the end the following new 
                paragraph (5):
            ``(5) Joint return filing programs.--
                    ``(A) In general.--Upon written request by the head 
                of any agency, body, or commission described in 
                paragraph (1), the Secretary may disclose common data 
                to such agency, body or commission for the purpose of 
                carrying out a joint return filing program entered into 
                under section 7525.
                    ``(B) Common data defined.--For purposes of this 
                paragraph, `common data' means any item of information 
                that is required by both Federal and State law to be 
                attached to or included on the respective Federal and 
                State returns.
                    ``(C) Procedures for state agencies.--Subsections 
                (a)(2) and (p)(4) of this section shall not apply with 
                respect to any disclosures made pursuant to this 
                paragraph. However, common data disclosed pursuant to 
                this paragraph is subject to subsection (p)(8) of this 
                section.''.
            (2) Section 6103(p)(3) is amended--
                    (A) in subparagraph (A) by inserting ``(d),'' after 
                ``subsections (c),''; and
                    (B) in subparagraph (C)(i) by striking ``(d),''.
            (3) Section 7212(a) is amended by inserting ``or any State 
        officer or employee who is authorized to administer Federal tax 
        laws pursuant to an agreement authorized by section 7525'' 
        after ``any officer or employee of the United States'' in both 
        places it appears.
            (4) Section 7213(a)(2) is amended by deleting ``(d),'' and 
        inserting instead ``(d)(1), (2), (3), or (4),''.
            (5) Section 7214 is amended--
                    (A) in subsection (a), by inserting ``or any State 
                officer or employee who is authorized to administer 
                Federal tax laws pursuant to an agreement authorized by 
                section 7525'' after ``Any officer or employee of the 
                United States''; and
                    (B) in subsection (b), by inserting ``or any State 
                employee who is authorized to administer Federal tax 
                laws pursuant to an agreement authorized by section 
                7525'' after ``Any internal revenue officer or 
                employee''.
            (6) Section 7431(a)(1) is amended by inserting ``or any 
        State employee who is authorized to administer Federal tax laws 
        pursuant to an agreement authorized by section 7525'' after 
        ``If any officer or employee of the United States''.
            (7) Section 7432(a) is amended by inserting ``or any State 
        employee who is authorized to release liens under section 6325 
        pursuant to an agreement authorized by section 7525'' after 
        ``If any officer or employee of the Internal Revenue Service''.
            (8) Section 7433(a) is amended by inserting ``or any State 
        employee who is authorized to collect Federal taxes pursuant to 
        an agreement authorized by section 7525'' after ``If, in 
        connection with any collection of Federal tax with respect to a 
        taxpayer, any officer or employee of the Internal Revenue 
        Service''.
    (c) Clerical Amendment.--The table of sections for chapter 77 is 
amended by adding at the end the following:

                              ``Sec. 7525.  Tax administration 
                                        agreements.''.

          TITLE III--PROVIDING FLEXIBILITY FOR IRS MANAGEMENT

SEC. 301. IMPROVEMENTS IN PERSONNEL FLEXIBILITIES.

    (a) In General.--Part III of title 5, United States Code, is 
amended by adding at the end the following new subpart:

                       ``Subpart I--Miscellaneous

``CHAPTER 95--PERSONNEL FLEXIBILITIES RELATING TO THE INTERNAL REVENUE 
                                SERVICE

``Sec.
``9501. Internal Revenue Service personnel flexibilities.
``9502. Pay authority for critical positions.
``9503. Streamlined critical pay authority.
``9504. Recruitment, retention, and relocation incentives.
``9505. Performance awards for senior executives.
``9506. Limited appointments to career reserved Senior Executive 
                            Service positions.
``9507. Streamlined demonstration project authority.
``9508. General workforce performance management system.
``9509. General workforce classification and pay.
``9510. General workforce staffing.
``Sec. 9501. Internal Revenue Service personnel flexibilities
    ``(a) Any flexibilities provided by sections 9502 through 9510 of 
this chapter shall be exercised in a manner consistent with the 
following provisions of this title:
            ``(1) chapter 23 (relating to merit system principles and 
        prohibited personnel practices);
            ``(2) provisions relating to preference eligibles;
            ``(3) except as otherwise specifically provided, section 
        5307 (relating to the aggregate limitation on pay);
            ``(4) except as otherwise specifically provided, chapter 71 
        (relating to labor-management relations); and
            ``(5) subject to sections 1104(b) and (c), as though such 
        authorities were delegated to the Secretary of the Treasury 
        under section 1104(a)(2).
    ``(b) The Secretary of the Treasury shall provide the Office of 
Personnel Management with any information that Office requires in 
carrying out its responsibilities under this section.
    ``(c) Employees within a unit to which a labor organization is 
accorded exclusive recognition under chapter 71 shall not be subject to 
any flexibility provided by sections 9507 through 9510 of this chapter 
unless the exclusive representative and the Internal Revenue Service 
have entered into a written agreement which specifically provides for 
the exercise of that flexibility. Such written agreement may not be 
imposed by the Federal Services Impasses Panel under section 7119.
    ``(d) For purposes of this chapter, the total annual compensation 
payable at the Office of the Comptroller of the Currency shall, for any 
year, be determined taking into account only those forms of 
compensation that are taken into account under section 5307(a) for 
purposes of such year.
``Sec. 9502. Pay authority for critical positions
    ``When the Secretary of the Treasury seeks a grant of authority 
pursuant to section 5377 for critical pay for one or more positions at 
the Internal Revenue Service, the Office of Management and Budget may 
fix the rate of basic pay, notwithstanding section 5377(d)(2) and 
section 5307, at any rate up to the highest total annual compensation 
payable at the Office of the Comptroller of the Currency, provided that 
total annual compensation for individuals appointed to such positions 
not exceed the highest total annual compensation payable at the Office 
of the Comptroller of the Currency.
``Sec. 9503. Streamlined critical pay authority
    ``Notwithstanding section 9502 of this title, and without regard to 
the provisions of this title governing appointments in the competitive 
service or the Senior Executive Service and the provisions of chapters 
51 and 53 of this title (relating to classification and pay rates), the 
Secretary of the Treasury may, for a period of ten years from the date 
of enactment of this section, establish, fix the compensation of, and 
appoint individuals to, designated critical technical and professional 
positions needed to carry out the functions of the Internal Revenue 
Service, provided that--
            ``(1) the positions--
                    ``(A) require expertise of an extremely high level 
                in a technical or professional field; and
                    ``(B) are critical to the Internal Revenue 
                Service's successful accomplishment of an important 
                mission;
            ``(2) exercise of the authority is necessary to recruit or 
        retain an individual exceptionally well qualified for the 
        position;
            ``(3) the number of such positions does not exceed at the 
        time of any new appointment the number equal to 5 percent of 
        the total number of employees holding positions in the Internal 
        Revenue Service the rate of basic pay for which is not less 
        than the minimum rate for grade GS-15 of the General Schedule;
            ``(4) designation of such positions shall be approved by 
        the Secretary of the Treasury upon the recommendation of the 
        Internal Revenue Service Management Board (established in 
        section 7801(b) of the Internal Revenue Code of 1986);
            ``(5) the terms of such appointments are limited to no more 
        than four years;
            ``(6) appointees to such positions were not Internal 
        Revenue Service employees immediately prior to such 
        appointment;
            ``(7) total annual compensation for any appointee to such 
        position does not exceed the highest total annual compensation 
        payable at the Office of the Comptroller of the Currency;
            ``(8) all such positions shall be excluded from the 
        collective bargaining unit; and
            ``(9) individuals appointed pursuant to this subsection 
        shall not be considered to be employees for purposes of 
        subchapter II of chapter 75 of this title.
Sec. 9504. Recruitment, retention, and relocation incentives
    ``For a period of ten years from the date of enactment of this 
section and subject to approval by the Office of Personnel Management, 
the Secretary of the Treasury may provide for variations from the 
provisions of sections 5753 and 5754 governing payment of recruitment, 
relocation, and retention incentives.
Sec. 9595. Performance awards for senior executives
    ``(a) For a period of ten years from the date of enactment of this 
section, Internal Revenue Service senior executives who have program 
management responsibility over significant functions of the Internal 
Revenue Service may be paid a performance bonus without regard to the 
limitation in section 5384(b)(2) of this title if the Secretary of the 
Treasury finds such award warranted based upon the executive's 
performance.
    ``(b) In evaluating an executive's performance for purposes of an 
award under this section, the Secretary of the Treasury shall take into 
account the executive's contributions toward the successful 
accomplishment of goals and objectives established under the Government 
Performance and Results Act of 1993 and other performance metrics or 
plans established in consultation with the Internal Revenue Service 
Management Board.
    ``(c) Any award in excess of 20 percent of an executive's rate of 
basic pay must be approved by the Secretary of the Treasury in 
consultation with the Internal Revenue Service Management Board.
    ``(d) Notwithstanding section 5384(b)(3) of this title, the 
Secretary of the Treasury shall determine the aggregate amount of 
performance awards available to be paid during any fiscal year under 
this section and section 5384 to career senior executives in the 
Internal Revenue Service provided that such amount does not exceed an 
amount equal to five percent of the aggregate amount of basic pay paid 
to career senior executives in the Internal Revenue Service during the 
preceding fiscal year. The Internal Revenue Service shall not be 
included in the determination under section 5384(b)(3) of the aggregate 
amount of performance awards payable to career senior executives in the 
Department of the Treasury outside of the Internal Revenue Service.
    ``(e) Notwithstanding section 5307 of this title, a performance 
bonus award may not be paid to an executive in a calendar year if, or 
to the extent that, the executive's total annual compensation will 
exceed the maximum amount of total annual compensation payable in the 
Office of the Comptroller of the Currency.
``9506. Limited appointments to career reserved Senior Executive 
              Service positions
    ``Notwithstanding any other provision of law, in applying section 
3132 of this title, a `career reserved position' in the Internal 
Revenue Service means a position designated under section 3132(b) which 
may be filled only by--
            ``(1) a career appointee, or
            ``(2) a limited emergency appointee or a limited term 
        appointee who, immediately upon entering the career-reserved 
        position, was serving under a career or career-conditional 
        appointment outside the Senior Executive Service or whose 
        limited emergency or limited term appointment is approved in 
        advance by the Office of Personnel Management.
``Sec. 9507. Streamlined demonstration project authority
    ``(a) The exercise of any of the flexibilities under sections 9502 
through 9510 does not affect the authority of the Secretary of the 
Treasury to implement for the Internal Revenue Service a demonstration 
project subject to chapter 47 of this title, as provided in subsection 
(b).
    ``(b) In applying section 4703 of this title to a demonstration 
project described in section 4701(a)(4) of this title which involves 
the Internal Revenue Service--
            ``(1) section 4703(b)(1) shall be deemed to read as 
        follows:
            ```(1) develop a plan for such project which describes its 
        purpose, the employees to be covered, the project itself, its 
        anticipated outcomes, and the method of evaluating the 
        project,';
            ``(2) section 4703(b)(3) shall apply;
            ``(3) the 180-day notification period in section 4703(b)(4) 
        shall be deemed to be a notification period of 30 days;
            ``(4) section 4703(b)(6) shall be deemed to read as 
        follows:
            ```(6) provides each House of Congress with the final 
        version of the plan.';
            ``(5) section 4703(c)(1) shall be deemed to read as 
        follows:
            ```(1) subchapter V of chapter 63 or subpart G of part III 
        of this title,';
            ``(6) the requirements of sections 4703(d)(1)(A) and (d)(2) 
        shall not apply; and
            ``(7) notwithstanding section 4703(d)(1)(B), based on an 
        evaluation as provided in section 4703(h), the Office of 
        Personnel Management and the Secretary of the Treasury, except 
        as otherwise provided by this subsection, may waive the 
        termination date of a demonstration project under section 
        4703(d). At least 90 days before waiving the termination date, 
        the Office of Personnel Management shall publish in the Federal 
        Register a notice of its intention to waive the termination 
        date and shall inform in writing both Houses of Congress of its 
        intention.
``Sec. 9508. General workforce performance management system
    ``(a) In lieu of a performance appraisal system established under 
section 4302 of this title, the Secretary of the Treasury may establish 
for all or part of the Internal Revenue Service a performance 
management system which--
            ``(1) maintains individual accountability by--
                    ``(A) establishing one or more retention standards 
                for each employee related to the work of the employee 
                and expressed in terms of individual performance, and 
                communicating such retention standards to employees;
                    ``(B) making periodic determinations of whether 
                each employee meets or does not meet the employee's 
                established retention standards; and
                    ``(C) taking actions, in accordance with applicable 
                laws and regulations, with respect to any employee 
whose performance does not meet established retention standards, 
including denying any increases in basic pay, promotions, and credit 
for performance under section 3502 of this title, and taking one or 
more of the following actions:
                            ``(i) reassignment;
                            ``(ii) an action under chapter 43 or 
                        chapter 75 of this title; or
                            ``(iii) any other appropriate action to 
                        resolve the performance problem; and
            ``(2) strengthens its effectiveness by--
                    ``(A) establishing goals or objectives for 
                individual, group, or organizational performance (or 
                any combination thereof), consistent with the Internal 
                Revenue Service's performance planning procedures, 
                including those established under the Government 
                Performance and Results Act of 1993, and communicating 
                such goals or objectives to employees;
                    ``(B) using such goals and objectives to make 
                performance distinctions among employees or groups of 
                employees; and
                    ``(C) using performance assessments as a basis for 
                granting employee awards, adjusting an employee's rate 
                of basic pay, and other appropriate personnel actions, 
                in accordance with applicable laws and regulations.
            ``(3) For purposes of subsection (a)(2), `performance 
        assessment' means a determination of whether or not retention 
        standards established under subsection (a)(1)(A) are met, and 
        any additional performance determination made on the basis of 
        performance goals and objectives established under subsection 
        (a)(2)(A).
For purposes of this title, `unacceptable performance' with respect to 
an employee of the Internal Revenue Service covered by a performance 
management system established pursuant to this section means 
performance of the employee which fails to meet a retention standard 
established under this subsection.
    ``(b)(1) The Secretary of the Treasury may establish an awards 
program designed to provide incentives for and recognition of 
organizational, group, and individual achievements by providing for 
granting awards to employees who, as individuals or members of a group, 
contribute to meeting the performance goals and objectives established 
under this chapter by such means as a superior individual or group 
accomplishment, a documented productivity gain, or sustained superior 
performance.
    ``(2) A cash award under subchapter I of chapter 45 may be granted 
to an employee of the Internal Revenue Service without the need for any 
approval under section 4502(b).
    ``(c)(1) In applying sections 4303(b)(1)(A) and 7513(b)(1) of this 
title to employees of the Internal Revenue Service, `30 days' may be 
deemed to be `15 days'.
    ``(2) Notwithstanding the second sentence of section 5335(c) of 
this title, an employee of the Internal Revenue Service shall not have 
a right to appeal the denial of a periodic step increase under section 
5335 to the Merit Systems Protection Board.
``Sec. 9509. General workforce classification and pay
    ``(a)(1) The Secretary of the Treasury may, subject to criteria to 
be prescribed by the Office of Personnel Management, establish one or 
more broad-banned systems covering all or any portion of the Internal 
Revenue Service workforce.
    ``(2)(A) Except as provided subparagraph (B), for purposes of this 
section, `board-banded system' means a system for grouping positions 
for pay, job evaluation, and other purposes that is different from the 
system established under chapter 51 and subchapter III of chapter 53 of 
this title as a result of combining grades and related ranges of rates 
of pay in one or more occupational series.
    ``(B) With the approval of the Office of Personnel Management, a 
broad-banded system established under this section may either include 
or consist of positions that otherwise would be subject to subchapter 
IV of chapter 53 or section 5376 of this title.
    ``(3) The Office of Personnel Management may require the Secretary 
of the Treasury to submit information relating to broad-banded systems 
at the Internal Revenue Service.
    ``(4) Except as otherwise provided under this section, employees 
under a broad-banded system shall continue to be subject to the laws 
and regulations covering employees under the pay system that otherwise 
would apply to them.
    ``(5) The criteria to be prescribed by the Office of Personnel 
Management shall, at a minimum--
            ``(A) ensure that the structure of any broad-banded system 
        maintains the principle of equal pay for substantially equal 
        work;
            ``(B) establish the minimum and maximum number of grades 
        that may be combined into pay bands;
            ``(C) establish requirements for setting minimum and 
        maximum rates of pay in a pay band;
            ``(D) establish requirements for adjusting the pay of an 
        employee within a pay band;
            ``(E) establish requirements for setting the pay of a 
        supervisory employee whose position is in a pay band or who 
        supervises employees whose positions are in pay bands; and
            ``(F) establish requirements and methodologies for setting 
        the pay of an employee upon conversion to a broad-banded 
        system, initial appointment, change of position or type of 
        appointment (including promotion, demotion, transfer, 
        reassignment, reinstatement, placement in another pay band, or 
        movement to a different geographic location), and movement 
        between a broad-banded system and another pay system.
    ``(b) With the approval of the Office of Personnel Management and 
in accordance with a plan for implementation submitted by the Secretary 
of the Treasury, the Secretary may, with respect to Internal Revenue 
Service employees who are covered by a broad-banded system established 
under subsection (a), provide for variations from the provisions of 
subchapter VI of chapter 53 of this title.
``Sec. 9510. General workforce staffing
    ``(a)(1) Except as otherwise provided by this section, an employee 
of the Internal Revenue Service may be selected for a permanent 
appointment in the competitive service in the Internal Revenue Service 
through internal competitive promotion procedures if:
            ``(A) the employee has completed, in the competitive 
        service, two years of current continuous service under a term 
        appointment or any combination of term appointments;
            ``(B) such term appointment or appointments were made under 
        competitive procedures prescribed for permanent appointments;
            ``(C) the employee's performance under such term 
        appointment or appointments met established retention 
        standards, or, if not covered by a performance management 
        system established under section 9508, was rated at the fully 
        successful level or higher (or equivalent thereof); and
            ``(D) the vacancy announcement for the term appointment 
        from which the conversion is made stated that there was a 
        potential for subsequent conversion to a permanent appointment.
    ``(2) An appointment under this section may be made only to a 
position in the same line of work as a position to which the employee 
received a term appointment under competitive procedures.
    ``(b)(1) Notwithstanding subchapter I of chapter 33 of this title, 
the Secretary of the Treasury may establish category rating systems for 
evaluating job applicants for Internal Revenue Service positions in the 
competitive service under which qualified candidates are divided into 
two or more quality categories on the basis of relative degrees of 
merit, rather than assigned individual numerical ratings.
    ``(2) Each applicant who meets the minimum qualification 
requirements for the position to be filled shall be assigned to an 
appropriate category based on an evaluation of the applicant's 
knowledge, skills, and abilities relative to those needed for 
successful performance in the job to be filled.
    ``(3) Within each quality category established under paragraph (1), 
preference eligibles shall be listed ahead of individuals who are not 
preference eligibles. For other than scientific and professional 
positions at or higher than GS-9 (or equivalent), preference eligibles 
who have a compensable service-connected disability of 10 percent or 
more, and who meet the minimum qualification standards, shall be listed 
in the highest quality category.
    ``(4) An appointing authority may select any applicant from the 
highest quality category or, if fewer than three candidates have been 
assigned to the highest quality category, from a merged category 
consisting of the highest and second highest quality categories.
    ``(5) Notwithstanding paragraph (4), the appointing authority may 
not pass over a preference eligible in the same or higher category from 
which selection is made unless the requirements of section 3317(b) or 
3318(b) of this title, as applicable, are satisfied.
    ``(c) The Secretary of the Treasury may detail employees among the 
offices of the Internal Revenue Service without regard to the 120-day 
limitation in section 3341(b) of this title.
    ``(d) Notwithstanding any other provision of law or regulation, the 
Secretary of the Treasury may establish a probationary period under 
section 3321 of this title of up to three years for Internal Revenue 
Service positions where the Secretary of the Treasury determines that 
the nature of the work is such that a shorter period is insufficient to 
demonstrate complete proficiency in the position.
    ``(e) Nothing in this section exempts the Secretary of the Treasury 
from--
            ``(1) any employment priority established under direction 
        of the President for the placement of surplus or displaced 
        employees; or
            ``(2) any obligation under a court order or decree relating 
        to the employment practices of the Internal Revenue Service or 
        the Department of the Treasury.''.
    (b) Clerical Amendment.--The table of sections for Part III of 
title 5, United States Code, is amended by adding at the end the 
following:

                       ``Subpart I--Miscellaneous

``95. Personnel flexibilities relating to the Internal          9501''.
                            Revenue Service.

SEC. 302. AUTHORIZATION FOR APPROPRIATIONS.

    There are authorized to be appropriated from time to time such sums 
as may be necessary to carry out the purposes of this Act.

SEC. 303. INTERNAL REVENUE SERVICE FUNDING.

    (a) Findings.--The Congress finds that:
            (1) The need of the Internal Revenue Service to resolve any 
        issues regarding their computer systems and the century date 
        change is the highest technology priority of the agency.
            (2) Without stable and predictable funding, the Internal 
        Revenue Service is unable effectively and efficiently to plan 
        and execute key programs for tax law enforcement, tax 
        processing, taxpayer assistance and management.
            (3) A lack of multi-year budgets for Internal Revenue 
        Service technology and capital investment programs deters some 
        contractors from working with the agency and raises the costs 
        of the changes necessary to make technology an enabler of 
        Internal Revenue Service strategic objectives.
    (b) Sense of Congress.--Based on these findings, it is the sense of 
the Congress that:
            (1) Internal Revenue Service efforts to resolve any century 
        date change computer issues should be funded fully to provide 
        for certain resolution of those issues.
            (2) The Internal Revenue Service budget for tax law 
        enforcement, tax processing, taxpayer assistance and management 
        should be maintained at no less than current levels for the 
        next three years.
            (3) Multi-year budgets should be adopted for Internal 
        Revenue Service technology and capital investment programs in 
        order to ensure stability in the implementation of those 
        programs.
                                 <all>