[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2836 Introduced in House (IH)]







108th CONGRESS
  1st Session
                                H. R. 2836

To amend the Internal Revenue Code of 1986 to reduce corporate refunds 
  by fines and penalties imposed by reason of improper accounting or 
    reporting practices or misstatements of its financial position.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 23, 2003

Mr. Meeks of New York introduced the following bill; which was referred 
                   to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to reduce corporate refunds 
  by fines and penalties imposed by reason of improper accounting or 
    reporting practices or misstatements of its financial position.

    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 ``Deadbeat Corporations Tax 
Accountability Act of 2003''.

SEC. 2. REDUCTION OF CORPORATE REFUNDS BY FINES AND PENALTIES IMPOSED 
              BY REASON OF IMPROPER ACCOUNTING OR REPORTING PRACTICES 
              OR MISSTATEMENTS OF ITS FINANCIAL POSITION.

    (a) In General.--Section 6402 of the Internal Revenue Code of 1986 
(relating to authority to make credits or refunds) is amended by adding 
the following new subsection:
    ``(l) Reduction of Overpayment in Case of Overstated Taxable Income 
Due to Accounting Practices or Related Misstatement of Financial 
Position.--
            ``(1) In general.--Upon receiving notice from the 
        Securities and Exchange Commission that a corporation has not 
        paid the full amount of a fine or penalty either imposed by a 
        court of competent jurisdiction, or agreed to by the 
        corporation, with respect to--
                    ``(A) the corporation's accounting or reporting 
                practices, or
                    ``(B) a related misstatement of its financial 
                position,
        the Secretary shall reduce the amount of any overpayment to be 
        refunded to such corporation by such unpaid balance.
            ``(2) Priorities for offset.--Any overpayment by a 
        corporation shall be reduced pursuant to this subsection after 
        such overpayment is reduced pursuant to subsection (a) with 
        respect to any liability for any internal revenue tax on the 
        part of the person who made the overpayment, subsection (d) 
        with respect to any past-due, legally enforceable debt owed to 
        a Federal agency, subsection (e) with respect to past-due, 
        legally enforceable state income tax obligations, and before 
        such overpayment is credited to the future liability for any 
        Federal internal revenue tax of such person pursuant to 
        subsection (b).
            ``(3) Remittance of amount by which overpayment is 
        reduced.--The amount by which any overpayment is reduced under 
        paragraph (1) shall be remitted by the Secretary to any 
        disgorgement fund or account that has been established under 
        section 308 of Public Law 107-204, 116 stat. 745 (2002) with 
        respect to the corporation, or, if no such fund or account is 
        established, retained by the Secretary.
            ``(4) Notification.--The Securities and Exchange Commission 
        shall provide notice to the Secretary within 30 days after--
                    ``(A) court approval of any settlement providing 
                for less than full payment of a fine or penalty 
                described in paragraph (1), or
                    ``(B) the Commission determines that such fine or 
                penalty, or some portion thereof, has become past due, 
                whichever is earlier.
            ``(5) Tentative carryback adjustments.--If a tentative 
        refund or credit of tax under section 6411 has been issued with 
        respect to a corporation that has failed to fully pay a fine or 
        penalty described in paragraph (1), the amount of such unpaid 
        balance shall constitute an excessive allowance of a tentative 
        carryback adjustment that may be assessed as a deficiency in 
        the manner set forth in section 6213(b)(3) (relating to the 
        assessment of an excess tentative carryback or refund 
        adjustment as a mathematical or clerical error).
            ``(6) Remittance of recaptured tentative carryback 
        adjustment.--The amount of any tentative carryback adjustment 
        assessed and collected pursuant to paragraph (5) shall be 
        remitted or retained by the Secretary in accordance with 
        paragraph (3). The remittance of any such amount to a fund or 
        account described in paragraph (3) shall not result in an 
        unpaid tax liability of the corporation.
            ``(7) Coordination with title 11.--The Secretary shall take 
        such actions as may be necessary or appropriate to carry out 
        the purposes of this section where the corporation that has 
        failed to pay the full amount of a fine or penalty described in 
        paragraph (1) is a debtor in a case under title 11 of the 
        United States Code, including, but not limited to, the filing 
        of an administrative expense claim for any amount that 
        constitutes an excessive allowance of a tentative carryback 
        adjustment.''
    (b) Effective Date.--This section shall be effective for fines and 
penalties imposed or agreed to with respect to a corporation's 
accounting or reporting practices, or a related misstatement of its 
financial position, that are not fully paid on the date of introduction 
of this Act, and for all such fines and penalties that later become 
unpaid or past due.
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