[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4994 Engrossed in House (EH)]

111th CONGRESS
  2d Session
                                H. R. 4994

_______________________________________________________________________

                                 AN ACT


 
 To amend the Internal Revenue Code of 1986 to reduce taxpayer burdens 
       and enhance taxpayer protections, 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, ETC.

    (a) Short Title.--This Act may be cited as the ``Taxpayer 
Assistance Act of 2010''.
    (b) Amendment of Internal Revenue Code of 1986.--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.--The table of contents of this Act is as 
follows:

Sec. 1. Short title, etc.
               TITLE I--CELL PHONES AND ELECTRONIC FILING

Sec. 101. Removal of cellular telephones and similar telecommunications 
                            equipment from listed property.
Sec. 102. Electronic filing exemption for religious reasons.
Sec. 103. Accelerate interest on refunds for returns filed 
                            electronically.
                          TITLE II--COLLECTION

Sec. 201. Study on the effectiveness of collection alternatives.
Sec. 202. Repeal of partial payment requirement on submissions of 
                            offers-in-compromise.
       TITLE III--TAXPAYER ASSISTANCE AND PROTECTION IMPROVEMENTS

Sec. 301. Referrals to Low-Income Taxpayer Clinics permitted.
Sec. 302. Low-income taxpayer clinics.
Sec. 303. EITC outreach.
Sec. 304. Taxpayer notification of suspected identity theft.
Sec. 305. Clarification of IRS unclaimed refund authority.
Sec. 306. Study on delivery of tax refunds.
Sec. 307. Study on timely processing and use of information returns.
Sec. 308. Study on easing the burden of in-person tax payments.
                      TITLE IV--REVENUE PROVISIONS

Sec. 401. Expansion of bad check penalty to electronic payments.
Sec. 402. Increase in information return penalties.
Sec. 403. Budget compliance.

               TITLE I--CELL PHONES AND ELECTRONIC FILING

SEC. 101. REMOVAL OF CELLULAR TELEPHONES AND SIMILAR TELECOMMUNICATIONS 
              EQUIPMENT FROM LISTED PROPERTY.

    (a) In General.--Subparagraph (A) of section 280F(d)(4) (defining 
listed property) is amended by adding ``and'' at the end of clause 
(iv), by striking clause (v), and by redesignating clause (vi) as 
clause (v).
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to taxable years beginning after December 31, 2009.

SEC. 102. ELECTRONIC FILING EXEMPTION FOR RELIGIOUS REASONS.

    Paragraph (3) of section 6011(e) (relating to special rule for tax 
return preparers) is amended by adding at the end the following new 
subparagraph:
                    ``(D) Exemption for religious reasons.--The 
                Secretary may exempt from requirements under 
                subparagraph (A) a tax return preparer who--
                            ``(i) is a member of a recognized religious 
                        sect or division thereof, and
                            ``(ii) is an adherent of established 
                        teachings or tenets that do not permit the use 
                        of magnetic media.''.

SEC. 103. ACCELERATE INTEREST ON REFUNDS FOR RETURNS FILED 
              ELECTRONICALLY.

    (a) In General.--Subsection (e) of section 6611 (relating to 
disallowance of interest on certain overpayments) is amended by adding 
at the end the following new paragraph:
            ``(4) Special rule.--In the case of any individual income 
        tax return relating to income tax filed by electronic means, 
        paragraph (1) shall be applied by substituting `30 days' for 
        `45 days' each place it appears.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to taxable years beginning after December 31, 2011.

                          TITLE II--COLLECTION

SEC. 201. STUDY ON THE EFFECTIVENESS OF COLLECTION ALTERNATIVES.

    (a) In General.--The Secretary of the Treasury shall conduct a 
study to assess the effectiveness of collection alternatives, 
especially offers-in-compromise, on long-term tax compliance. Such a 
study shall analyze a group of taxpayers who applied for offers-in-
compromise 5 or more years ago and compare the amount of revenue 
collected from the taxpayers whose offers were accepted with the amount 
of revenue collected from the taxpayers whose offers were rejected, and 
compare, among the taxpayers whose offers were rejected, the amount 
they offered with the amounts collected.
    (b) Report.--Not later than 1 year after the date of enactment of 
this Act, the Secretary of the Treasury shall submit a report to 
Congress containing the results of the study conducted under subsection 
(a).

SEC. 202. REPEAL OF PARTIAL PAYMENT REQUIREMENT ON SUBMISSIONS OF 
              OFFERS-IN-COMPROMISE.

    (a) In General.--Section 7122 is amended by striking subsection (c) 
and by redesignating subsections (d), (e), (f), and (g) as subsection 
(c), (d), (e), and (f), respectively.
    (b) Conforming Amendments.--
            (1) Paragraph (3) of section 7122(d) is amended--
                    (A) by inserting ``and'' at the end of the 
                subparagraph (A),
                    (B) by striking ``, and'' at the end of 
                subparagraph (B) and inserting a period, and
                    (C) by striking subparagraph (C).
            (2) Subsection (f) of section 6159 is amended by striking 
        ``section 7122(e)'' and inserting ``section 7122(d)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to offers submitted after the date of the enactment of this Act.

       TITLE III--TAXPAYER ASSISTANCE AND PROTECTION IMPROVEMENTS

SEC. 301. REFERRALS TO LOW-INCOME TAXPAYER CLINICS PERMITTED.

    (a) In General.--Subsection (c) of section 7526 is amended by 
adding at the end the following new paragraph:
            ``(6) Treasury employees permitted to refer taxpayers to 
        qualified low-income taxpayer clinics.--Notwithstanding any 
        other provision of law, officers and employees of the 
        Department of the Treasury may refer taxpayers for advice and 
        assistance to qualified low-income taxpayer clinics receiving 
        funding under this section.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to referrals made after the date of the enactment of this Act.

SEC. 302. LOW-INCOME TAXPAYER CLINICS.

    (a) Increase in Authorized Grants.--Paragraph (1) of section 
7526(c) (relating to aggregate limitation) is amended by striking 
``$6,000,000'' and inserting ``$20,000,000''.
    (b) Clerical Amendment.--Section 7526(c)(5) is amended by inserting 
``qualified'' before ``low-income''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to grants made after the date of the enactment of 
this Act.

SEC. 303. EITC OUTREACH.

    (a) In General.--Section 32 (relating to earned income) is amended 
by adding at the end the following new subsection:
    ``(n) Notification of Potential Eligibility for Credit and 
Refund.--
            ``(1) In general.--To the extent possible and on an annual 
        basis, the Secretary shall provide to each taxpayer who--
                    ``(A) for any preceding taxable year for which 
                credit or refund is not precluded by section 6511, and
                    ``(B) did not claim the credit under subsection (a) 
                but may be allowed such credit for any such taxable 
                year based on return or return information (as defined 
                in section 6103(b)) available to the Secretary,
        notice that such taxpayer may be eligible to claim such credit 
        and a refund for such taxable year.
            ``(2) Notice.--Notice provided under paragraph (1) shall be 
        in writing and sent to the last known address of the 
        taxpayer.''.
    (b) Effective Date.--The amendment made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 304. TAXPAYER NOTIFICATION OF SUSPECTED IDENTITY THEFT.

    (a) In General.--Chapter 77 (relating to miscellaneous provisions), 
as amended by this Act, is amended by adding at the end the following 
new section:

``SEC. 7529. NOTIFICATION OF SUSPECTED IDENTITY THEFT.

    ``If, in the course of an investigation under the internal revenue 
laws, the Secretary determines that there was or may have been an 
unauthorized use of the identity of the taxpayer or a dependent of the 
taxpayer, the Secretary shall, to the extent permitted by law--
            ``(1) as soon as practicable and without jeopardizing such 
        investigation, notify the taxpayer of such determination, and
            ``(2) if any person is criminally charged by indictment or 
        information with respect to such unauthorized use, notify such 
        taxpayer as soon as practicable of such charge.''.
    (b) Clerical Amendment.--The table of sections for chapter 77 is 
amended by adding at the end the following new item:

``Sec. 7529. Notification of suspected identity theft.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to determinations made after the date of the enactment of this 
Act.

SEC. 305. CLARIFICATION OF IRS UNCLAIMED REFUND AUTHORITY.

    Paragraph (1) of section 6103(m) (relating to tax refunds) is 
amended by inserting ``, and through any other means of mass 
communication,'' after ``media''.

SEC. 306. STUDY ON DELIVERY OF TAX REFUNDS.

    (a) In General.--The National Taxpayer Advocate shall conduct a 
study on the feasibility of delivering tax refunds on debit cards, 
prepaid cards, and other electronic means to assist individuals that do 
not have access to financial accounts or institutions.
    (b) Report.--Not later than 1 year after the date of enactment of 
this Act, the National Taxpayer Advocate shall submit a report to 
Congress containing the results of the study conducted under subsection 
(a).

SEC. 307. STUDY ON TIMELY PROCESSING AND USE OF INFORMATION RETURNS.

    (a) In General.--The Secretary of the Treasury shall conduct a 
study on the administrative and legislative changes that would be 
needed to receive and process information returns before processing 
income tax returns.
    (b) Report.--Not later than 1 year after the date of the enactment 
of this Act, the Secretary shall submit a report to the Committee on 
Ways and Means of the House of Representatives and the Committee on 
Finance of the Senate containing the results of the study conducted 
under subsection (a), together with such recommendations as the 
Secretary considers necessary or appropriate for implementation of 
these changes.

SEC. 308. STUDY ON EASING THE BURDEN OF IN-PERSON TAX PAYMENTS.

    (a) In General.--The Secretary of the Treasury shall conduct a 
study on how to reduce the number of taxpayers making payments at IRS 
Taxpayer Assistance Centers. The report shall include an analysis of--
            (1) whether the Federal Tax Deposit Coupon (Form 8109) 
        could be expanded so that it can be used with all Federal tax 
        deposits and payments, and
            (2) what current or new return filing, payment, and proof 
        of payment options could be implemented to reduce the burden of 
        in-person payments.
    (b) Report.--Not later than 1 year after the date of the enactment 
of this Act, the Secretary shall submit a report to the Committee on 
Ways and Means of the House of Representatives and the Committee on 
Finance of the Senate containing the results of the study conducted 
under subsection (a), together with such recommendations as the 
Secretary considers necessary or appropriate.

                      TITLE IV--REVENUE PROVISIONS

SEC. 401. EXPANSION OF BAD CHECK PENALTY TO ELECTRONIC PAYMENTS.

    (a) In General.--Section 6657 (relating to bad checks) is amended 
by adding at the end the following: ``Except as otherwise provided by 
the Secretary, any authorization of a payment by commercially 
acceptable means (within the meaning of section 6311) shall be treated 
for purposes of this section in the same manner as a check.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to authorizations of payments made after December 31, 2010.

SEC. 402. INCREASE IN INFORMATION RETURN PENALTIES.

    (a) Failure To File Correct Information Returns.--
            (1) In general.--Subsections (a)(1), (b)(1)(A), and 
        (b)(2)(A) of section 6721 are each amended by striking ``$50'' 
        and inserting ``$100''.
            (2) Aggregate annual limitation.--Subsections (a)(1), 
        (d)(1)(A), and (e)(3)(A) of section 6721 are each amended by 
        striking ``$250,000'' and inserting ``$1,500,000''.
    (b) Reduction Where Correction Within 30 Days.--
            (1) In general.--Subparagraph (A) of section 6721(b)(1) is 
        amended by striking ``$15'' and inserting ``$30''.
            (2) Aggregate annual limitation.--Subsections (b)(1)(B) and 
        (d)(1)(B) of section 6721 are each amended by striking 
        ``$75,000'' and inserting ``$250,000''.
    (c) Reduction Where Correction on or Before August 1.--
            (1) In general.--Subparagraph (A) of section 6721(b)(2) is 
        amended by striking ``$30'' and inserting ``$60''.
            (2) Aggregate annual limitation.--Subsections (b)(2)(B) and 
        (d)(1)(C) of section 6721 are each amended by striking 
        ``$150,000'' and inserting ``$500,000''.
    (d) Aggregate Annual Limitations for Persons With Gross Receipts of 
Not More Than $5,000,000.--Paragraph (1) of section 6721(d) is 
amended--
            (1) by striking ``$100,000'' in subparagraph (A) and 
        inserting ``$500,000'',
            (2) by striking ``$25,000'' in subparagraph (B) and 
        inserting ``$75,000'', and
            (3) by striking ``$50,000'' in subparagraph (C) and 
        inserting ``$200,000''.
    (e) Penalty in Case of Intentional Disregard.--Paragraph (2) of 
section 6721(e) is amended by striking ``$100'' and inserting ``$250''.
    (f) Adjustment for Inflation.--Section 6721 is amended by adding at 
the end the following new subsection:
    ``(f) Adjustment for Inflation.--
            ``(1) In general.--For each fifth calendar year beginning 
        after 2012, each of the dollar amounts under subsections (a), 
        (b), (d) (other than paragraph (2)(A) thereof), and (e) shall 
        be increased by such dollar amount multiplied by the cost-of-
        living adjustment determined under section 1(f)(3) determined 
        by substituting `calendar year 2011' for `calendar year 1992' 
        in subparagraph (B) thereof.
            ``(2) Rounding.--If any amount adjusted under paragraph 
        (1)--
                    ``(A) is not less than $75,000 and is not a 
                multiple of $500, such amount shall be rounded to the 
                next lowest multiple of $500, and
                    ``(B) is not described in subparagraph (A) and is 
                not a multiple of $10, such amount shall be rounded to 
                the next lowest multiple of $10.''.
    (g) Effective Date.--The amendments made by this section shall 
apply with respect to information returns required to be filed on or 
after January 1, 2011.

SEC. 403. BUDGET COMPLIANCE.

    The budgetary effects of this Act, for the purpose of complying 
with the Statutory Pay-As-You-Go Act of 2010, shall be determined by 
reference to the latest statement titled ``Budgetary Effects of PAYGO 
Legislation'' for this Act, submitted for printing in the Congressional 
Record by the Chairman of the Committee on the Budget of the House of 
Representatives, provided that such statement has been submitted prior 
to the vote on passage.

            Passed the House of Representatives April 14, 2010.

            Attest:

                                                                 Clerk.
111th CONGRESS

  2d Session

                               H. R. 4994

_______________________________________________________________________

                                 AN ACT

 To amend the Internal Revenue Code of 1986 to reduce taxpayer burdens 
       and enhance taxpayer protections, and for other purposes.