[Congressional Record Volume 152, Number 132 (Tuesday, December 5, 2006)]
[House]
[Pages H8700-H8701]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
INNOCENT SPOUSE PROTECTION ACT
Mr. RAMSTAD. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 6111) to amend the Internal Revenue Code of 1986 to provide
that the Tax Court may review claims for equitable innocent spouse
relief and to suspend the running on the period of limitations while
such claims are pending, as amended.
The Clerk read as follows
H.R. 6111
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. TAX COURT REVIEW OF REQUESTS FOR EQUITABLE RELIEF
FROM JOINT AND SEVERAL LIABILITY.
(a) In General.--Paragraph (1) of section 6015(e) of the
Internal Revenue Code of 1986 (relating to petition for tax
court review) is amended by inserting ``, or in the case of
an individual who requests equitable relief under subsection
(f)'' after ``who elects to have subsection (b) or (c)
apply''.
(b) Conforming Amendments.--
(1) Section 6015(e)(1)(A)(i)(II) of such Code is amended by
inserting ``or request is made'' after ``election is filed''.
(2) Section 6015(e)(1)(B)(i) of such Code is amended--
(A) by inserting ``or requesting equitable relief under
subsection (f)'' after ``making an election under subsection
(b) or (c)'', and
(B) by inserting ``or request'' after ``to which such
election''.
(3) Section 6015(e)(1)(B)(ii) of such Code is amended by
inserting ``or to which the request under subsection (f)
relates'' after ``to which the election under subsection (b)
or (c) relates''.
(4) Section 6015(e)(4) of such Code is amended by inserting
``or the request for equitable relief under subsection (f)''
after ``the election under subsection (b) or (c)''.
(5) Section 6015(e)(5) of such Code is amended by inserting
``or who requests equitable relief under subsection (f)''
after ``who elects the application of subsection (b) or
(c)''.
(6) Section 6015(g)(2) of such Code is amended by inserting
``or of any request for equitable relief under subsection
(f)'' after ``any election under subsection (b) or (c)''.
(7) Section 6015(h)(2) of such Code is amended by inserting
``or a request for equitable relief made under subsection
(f)'' after ``with respect to an election made under
subsection (b) or (c)''.
(c) Effective Date.--The amendments made by this section
shall apply with respect to liability for taxes arising or
remaining unpaid on or after the date of the enactment of
this Act.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Minnesota (Mr. Ramstad) and the gentleman from New York (Mr. McNulty)
each will control 20 minutes.
The Chair recognizes the gentleman from Minnesota.
Mr. RAMSTAD. Mr. Speaker, I yield myself such time as I may consume.
I rise in support of H.R. 6111, a bill to provide the U.S. Tax Court
with jurisdiction to review innocent spouse relief claims. I urge my
colleagues to join me in passing this legislation introduced by our
distinguished colleague and friend from California, Representative
Tauscher.
Under current law, married couples who submit joint tax returns are
individually responsible for paying the taxes owed to the Federal
Government. The Internal Revenue Service can, however, relieve this
responsibility, Mr. Speaker, in situations where one spouse was unaware
that the other spouse understated the amount of taxes due on their
joint return. This type of relief, called innocent spouse relief, is
granted at the discretion of the IRS. Currently, if the IRS denies a
claim for innocent spouse relief, the tax court which specializes in
tax law, does not have jurisdiction to review the IRS decision. This
bill would provide the tax court with authority to review these claims
by innocent spouses.
Mr. Speaker, we have the opportunity today to allow innocent spouses
to take their cases to the Federal court with the most knowledge and
expertise in handling tax matters. The tax court's experience with tax
cases should ensure that denials of claims for innocent spouse relief
are handled both fairly and expeditiously.
Mr. Speaker, I commend my colleague and friend, Representative
Tauscher, for her leadership and key work on this issue. The Senate has
passed a similar provision, and I urge my colleagues to do the same by
voting in favor of this important commonsense legislation.
Mr. Speaker, I reserve the balance of my time.
Mr. McNULTY. Mr. Speaker, I yield myself such time as I may consume.
(Mr. McNULTY asked and was given permission to revise and extend his
remarks.)
Mr. McNULTY. Mr. Speaker, I rise in support of H.R. 6111, legislation
which enhances the innocent spouse equitable relief provision of the
Internal Revenue Code. I believe that the enactment of this proposal
will provide a straightforward and noncontroversial solution to the
unfair treatment of innocent spouses under current law. Through only
minor legislative modifications, this bill clarifies the statute's
original intent, affording innocent spouses the necessary recourse to
ensure their cases and circumstances are given a fair hearing.
Mr. Speaker, at this time, I would like to yield such time as she may
consume to the sponsor of this legislation, the gentlewoman from
California (Mrs. Tauscher).
Mrs. TAUSCHER. Mr. Speaker, please let me thank my colleague, Mr.
McNulty, for his great leadership and my distinguished colleague from
Minnesota, Mr. Ramstad, for his friendship and leadership, too.
Mr. Speaker, I rise in really strong support of the Innocent Spouse
Protection Act. Along with my great friend and colleague Senator
Feinstein of California, I introduced this legislation because I
believe that it will provide a straightforward solution to the unfair
treatment of innocent spouses under the current law.
Under the current Tax Code, the IRS may relieve an innocent spouse of
liability for unpaid taxes if it would be unfair to hold that spouse
responsible. No recourse exists, however, to prevent the IRS from
seizing assets or garnishing wages if relief is not approved. The story
of one Californian provides an example of the problem.
The IRS seized all of her husband's income to pay a tax liability
incurred 20 years earlier, very long before they were married, which is
clearly not the responsibility of this spouse. But because the IRS
seized all of the income, the taxes on the income remained unpaid and,
as you can imagine, the ball keeps rolling along.
When this woman's spouse died, the IRS pursued the innocent spouse
for the taxes on her deceased husband's income. Along rolls the ball.
She was forced to then sell her family home and all of her property
owned jointly with her husband. In fact, the IRS may have her wages
garnished along with funds set aside for her in a trust by a probate
court in a completely unrelated family matter.
Recent decisions by the Eighth and Ninth Circuit Courts of Appeals
have denied the tax court jurisdiction over petitions for equitable
relief. Consequently, there are no mechanisms for review or appeal of
these IRS decisions.
The aim of this legislation is to provide an avenue through which
these decisions may be appealed. This bill in no way guarantees relief,
but rather fixes the broken appeals process for these IRS decisions.
Mr. Speaker, I urge my colleagues to support this small change that
is supported by my colleagues on the Ways and Means Committee that will
have a profound effect on the lives of many innocent spouses who
deserve their day in court.
[[Page H8701]]
Mr. McNULTY. Mr. Speaker, I yield back the balance of my time.
Mr. RAMSTAD. Mr. Speaker, we have no further speakers on this bill, I
urge my colleagues to support H.R. 6111, and I yield back the balance
of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Minnesota (Mr. Ramstad) that the House suspend the rules
and pass the bill, H.R. 6111, as amended.
The question was taken; and (two-thirds of those voting having
responded in the affirmative) the rules were suspended and the bill, as
amended, was passed.
A motion to reconsider was laid on the table.
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