110 HR 7300 IH: To provide for the proper application under the Internal U.S. House of Representatives 2008-11-20 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 110th CONGRESS 2d Session H. R. 7300 IN THE HOUSE OF REPRESENTATIVES November 20, 2008 Mr. Doggett (for himself, Mr. McDermott, Mr. Stark, Mr. Pascrell, and Mr. Lewis of Georgia) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To provide for the proper application under the Internal Revenue Code of 1986 of the limitations on built-in losses following an ownership change of a bank.

1.

Findings

Congress finds as follows: (1)A delegation of authority to the Secretary of the Treasury, or his delegate, to prescribe such regulations as may be necessary or appropriate to carry out the purposes of a provision of the Internal Revenue Code of 1986 does not authorize the Secretary to exempt from that provision transactions that would be clearly within the scope of the provision. (2)Such an exemption is particularly troublesome when it is restricted to particular industries or classes of taxpayers. (3)Treasury Notice 2008–83 is inconsistent with the congressional intent behind delegations of regulatory authority of the type described in paragraph (1). (4)The legal authority to prescribe Treasury Notice 2008–83 is doubtful. (5)However, as taxpayers should generally be able to rely on guidance issued by the Secretary of the Treasury or his delegate, legislation is necessary to clarify the force and effect of Treasury Notice 2008–83 and restore the proper application under the Internal Revenue Code of 1986 of the limitation on built-in losses following an ownership change of a bank.

2.

Determination of force and effect of Treasury Notice 2008–83 exempting banks from limitation on certain built-in losses following ownership change

(a)

In general

Treasury Notice 2008–83— (1)shall be deemed to have the force and effect of law with respect to any ownership change (as defined in section 382(g) of the Internal Revenue Code of 1986) occurring during the period beginning on September 30, 2008, and ending on the earlier of the date of first committee action on this bill or the date on which the Chairman of the Committee on Ways and Means of the House of Representatives and the Chairman of the Committee on Finance of the Senate issue a joint statement indicating their intention to terminate the application of such notice, and (2)shall have no force or effect with respect to any ownership change during any other period. (b)

Binding contracts

Notwithstanding subsection (a), Treasury Notice 2008–83 shall have the force and effect of law with respect to any ownership change (as so defined) which occurs pursuant to a written binding contract entered into during the period described in subsection (a).

3.

Investigation of conflicts of interest

(a)

In general

The Inspector General of the Treasury shall conduct an investigation into the circumstances leading to the issuance of Treasury Notice 2008–83 and any conflicts of interest involving Treasury officials who participated in decisions regarding Treasury Notice 2008–83. (b)

Report

The Inspector General of the Treasury shall, not later than 6 months after the date of the enactment of this Act, report the results of the investigation conducted under subsection (a) to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate.