HR 5716 IHCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to provide taxpayer protection and assistance, and for other purposes.CommentsClose CommentsPermalink

April 8, 2008

Mr. BECERRA (for himself, Mr. DOGGETT, and Mr. PASCRELL) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Financial Services, 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 concernedCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to provide taxpayer protection and assistance, and for other purposes.CommentsClose CommentsPermalink

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

SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

(a) Short Title- This Act may be cited as the `Taxpayer Bill of Rights Act of 2008'.CommentsClose CommentsPermalink





(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.CommentsClose CommentsPermalink

SEC. 2. STATEMENT OF TAXPAYER RIGHTS AND OBLIGATIONS.

(a) In General- Chapter 77 (relating to miscellaneous provisions) is amended by adding at the end the following new section:CommentsClose CommentsPermalink

`SEC. 7529. STATEMENT OF TAXPAYER RIGHTS AND OBLIGATIONS.

`(a) In General- The Secretary, in consultation with the National Taxpayer Advocate, shall publish a summary statement of rights and obligations arising under this title. Such statement shall provide citations to the main provisions of this title which provide for the right or obligation (as the case may be). This statement of rights and obligations does not create or confer any rights or obligations not otherwise provided for under this title.CommentsClose CommentsPermalink





`(b) Statement of Rights and Obligations- The statement of rights and obligations is as follows:CommentsClose CommentsPermalink





`(1) TAXPAYER RIGHTS-CommentsClose CommentsPermalink





`(A) Right to be informed (including adequate legal and procedural guidance and information about taxpayer rights).CommentsClose CommentsPermalink





`(B) Right to be assisted.CommentsClose CommentsPermalink





`(C) Right to be heard.CommentsClose CommentsPermalink





`(D) Right to pay no more than the correct amount of tax.CommentsClose CommentsPermalink





`(E) Right of appeal (administrative and judicial).CommentsClose CommentsPermalink





`(F) Right to certainty (including guidance, periods of limitation, no second exam, and closing agreements).CommentsClose CommentsPermalink





`(G) Right to privacy (including due process considerations, least intrusive enforcement action, and search and seizure protections).CommentsClose CommentsPermalink





`(H) Right to confidentiality.CommentsClose CommentsPermalink





`(I) Right to appoint a representative in matters before the Internal Revenue Service.CommentsClose CommentsPermalink





`(J) Right to fair and just tax system (offer in compromise, abatement, assistance from the Office of the Taxpayer Advocate under section 7803(c), apology, and other compensation payments).CommentsClose CommentsPermalink





`(2) TAXPAYER OBLIGATIONS-CommentsClose CommentsPermalink





`(A) Obligation to be honest.CommentsClose CommentsPermalink





`(B) Obligation to be cooperative.CommentsClose CommentsPermalink





`(C) Obligation to provide accurate information and documents on time.CommentsClose CommentsPermalink





`(D) Obligation to keep records.CommentsClose CommentsPermalink





`(E) Obligation to pay taxes on time.'.CommentsClose CommentsPermalink





(b) Clerical Amendment- The table of sections for chapter 77 is amended by adding at the end the following new item:CommentsClose CommentsPermalink





`Sec. 7529. Statement of taxpayer rights and obligations.'.CommentsClose CommentsPermalink





(c) Effective Date- The amendments made by this section shall take effect 180 days after the date of the enactment of this Act.CommentsClose CommentsPermalink

SEC. 3. PROGRAMS FOR THE BENEFIT OF LOW-INCOME TAXPAYERS.

(a) Volunteer Income Tax Assistance Plus- Chapter 77 (relating to miscellaneous provisions) is amended by inserting after section 7526 the following new section:CommentsClose CommentsPermalink

`SEC. 7526A. VOLUNTEER INCOME TAX ASSISTANCE PLUS.

`(a) In General- The Secretary may, subject to the availability of appropriated funds, make grants to provide matching funds for the development, expansion, or continuation of qualified return preparation programs.CommentsClose CommentsPermalink





`(b) Definitions- For purposes of this section--CommentsClose CommentsPermalink





`(1) QUALIFIED RETURN PREPARATION PROGRAM-CommentsClose CommentsPermalink





`(A) IN GENERAL- The term `qualified return preparation program' means a program--CommentsClose CommentsPermalink





`(i) which does not charge taxpayers for its return preparation services,CommentsClose CommentsPermalink





`(ii) which operates programs which assist low-income taxpayers in preparing and filing their Federal income tax returns, including schedules reporting sole proprietorship or farm income, andCommentsClose CommentsPermalink





`(iii) in which all of the volunteers who assist in the preparation of Federal income tax returns meet the training requirements prescribed by the Secretary.CommentsClose CommentsPermalink





`(B) ASSISTANCE TO LOW-INCOME TAXPAYERS- For purposes of subparagraph (A), a program is treated as assisting low-income taxpayers if at least 90 percent of the taxpayers assisted by the program have incomes which do not exceed 250 percent of the poverty level, as determined in accordance with criteria established by the Director of the Office of Management and Budget.CommentsClose CommentsPermalink





`(2) PROGRAM- The term `program' includes--CommentsClose CommentsPermalink





`(A) a program at an institution of higher education which--CommentsClose CommentsPermalink





`(i) is described in section 102 (other than subsection (a)(1)(C) thereof) of the Higher Education Act of 1965 (20 U.S.C. 1088), as in effect on the date of the enactment of this section, and which has not been disqualified from participating in a program under title IV of such Act, andCommentsClose CommentsPermalink





`(ii) satisfies the requirements of paragraph (1) through student assistance of taxpayers in return preparation and filing,CommentsClose CommentsPermalink





`(B) an organization described in section 501(c) and exempt from tax under section 501(a) which satisfies the requirements of paragraph (1);CommentsClose CommentsPermalink





`(C) a regional, State or local coalition (with one lead organization, which meets the eligibility requirements, acting as the applicant organization);CommentsClose CommentsPermalink





`(D) a county or municipal government agency;CommentsClose CommentsPermalink





`(E) an Indian tribe, as defined in section 4(12) of the Native American Housing Assistance and Self-Determination Act of 1996 (25 U.S.C. 4103(12), and includes any tribally designated housing entity (as defined in section 4(21) of such Act (25 U.S.C. 4103(21)), tribal subsidiary, subdivision, or other wholly owned tribal entity;CommentsClose CommentsPermalink





`(F) a section 501(c)(5) organization;CommentsClose CommentsPermalink





`(G) a State government agency if no other eligible organization is available to assist the targeted population or community;CommentsClose CommentsPermalink





`(H) a Cooperative Extension Service office if no other eligible organization is available to assist the targeted population or community; andCommentsClose CommentsPermalink





`(I) a nonprofit Community Development Financial Institution (CDFI) and federally- and State-charted credit union that qualifies for a tax exemption under sections 501(c)(1) and 501(c)(14), respectively.CommentsClose CommentsPermalink





`(c) Special Rules and Limitations-CommentsClose CommentsPermalink





`(1) AGGREGATE LIMITATION- Unless otherwise provided by specific appropriation, the Secretary shall not allocate more than $10,000,000 per year (exclusive of costs of administering the program) to grants under this section.CommentsClose CommentsPermalink





`(2) USE OF GRANTS FOR OVERHEAD EXPENSES PROHIBITED- No grant made under this section may be used for the overhead expenses that are not directly related to any program or that are of any institution sponsoring such program.CommentsClose CommentsPermalink





`(3) OTHER APPLICABLE RULES- Rules similar to the rules under paragraphs (2) through (6) of section 7526(c) shall apply with respect to the awarding of grants to qualified return preparation programs.CommentsClose CommentsPermalink





`(4) PROMOTION OF CLINICS- The Secretary is authorized to promote the benefits of and encourage the use of qualified VITA Plus through the use of mass communications, referrals, and other means.'.CommentsClose CommentsPermalink





(b) Low-Income Taxpayer Clinics-CommentsClose CommentsPermalink





(1) INCREASE IN AUTHORIZED GRANTS- Paragraph (1) of section 7526(c) (relating to aggregate limitation) is amended by striking `$6,000,000' and inserting `$10,000,000'.CommentsClose CommentsPermalink





(2) USE OF GRANTS FOR OVERHEAD EXPENSES PROHIBITED-CommentsClose CommentsPermalink





(A) IN GENERAL- Section 7526(c) (relating to special rules and limitations) is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





`(6) USE OF GRANTS FOR OVERHEAD EXPENSES PROHIBITED- No grant made under this section may be used for the overhead expenses that are not directly related to the clinic or that are of any institution sponsoring such clinic.'.CommentsClose CommentsPermalink





(B) CONFORMING AMENDMENTS- Section 7526(c)(5) is amended--CommentsClose CommentsPermalink





(i) by inserting `qualified' before `low-income', andCommentsClose CommentsPermalink





(ii) by striking the last sentence.CommentsClose CommentsPermalink





(3) PROMOTION OF CLINICS- Subsection (c) of section 7526 (relating to special rules and limitations), as amended by paragraph (2), is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





`(7) PROMOTION OF CLINICS- The Secretary is authorized to promote the benefits of and encourage the use of qualified low-income taxpayer clinics through the use of mass communications, referrals, and other means.'.CommentsClose CommentsPermalink





(4) IRS REFERRALS TO CLINICS- Subsection (c) of section 7526 (relating to special rules and limitations), as amended by the preceding provisions of this subsection, is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





`(8) IRS REFERRALS- The Secretary may refer taxpayers to low-income taxpayer clinics receiving funding under this section.'.CommentsClose CommentsPermalink





(c) Clerical Amendment- The table of sections for chapter 77 is amended by inserting after the item relating to section 7526 the following new item:CommentsClose CommentsPermalink





`Sec. 7526A. Volunteer income tax assistance plus.'.CommentsClose CommentsPermalink





(d) Effective Date- The amendments made by this section shall take effect on the date of the enactment of this Act.CommentsClose CommentsPermalink

SEC. 4. REGULATION OF FEDERAL INCOME TAX RETURN PREPARERS.

(a) In General- Section 330(a)(1) of title 31, United States Code, is amended by inserting `(including tax return preparers of Federal tax returns, documents, and other submissions)' after `representatives'.CommentsClose CommentsPermalink





(b) Promulgation of Regulations- The Secretary of the Treasury shall prescribe regulations under section 330 of title 31, United States Code, to regulate those tax return preparers not otherwise regulated under regulations promulgated under such section on the date of the enactment of this Act to carry out the provisions of, and amendments made by, this section.CommentsClose CommentsPermalink





(c) Requirements- Such regulations shall provide guidance on the following:CommentsClose CommentsPermalink





(1) EXAMINATION-CommentsClose CommentsPermalink





(A) IN GENERAL- In promulgating the regulations under paragraph (1), the Secretary shall approve and oversee an eligibility examination designed to test--CommentsClose CommentsPermalink





(i) the technical knowledge and competency of each tax return preparer to prepare Federal tax returns, including individual and business income tax returns, andCommentsClose CommentsPermalink





(ii) the knowledge of each such tax return preparer regarding such ethical standards for the preparation of such returns as determined appropriate by the Secretary.CommentsClose CommentsPermalink





(B) GRANDFATHER- The Secretary is authorized to accept an individual as meeting the eligibility examination requirement of this section if, in lieu of the eligibility examination under this section, the individual passed an exam comparable to the eligibility examination described in subparagraph (A) if such exam was administered within 5 years of the issuance of the regulations under this section.CommentsClose CommentsPermalink





(2) SUITABILITY STANDARDS- The Secretary shall provide suitability standards for practicing as a tax return preparer, including personal compliance with the requirements of the Internal Revenue Code of 1986.CommentsClose CommentsPermalink





(3) CONTINUING ELIGIBILITY-CommentsClose CommentsPermalink





(A) IN GENERAL- The regulations under paragraph (1) shall require a renewal of eligibility every 3 years and shall set forth the manner in which a tax return preparer must renew such eligibility.CommentsClose CommentsPermalink





(B) CONTINUING PROFESSIONAL EDUCATION REQUIREMENTS- As part of the renewal of eligibility, such regulations shall require that each such tax return preparer show evidence of completion of such continuing education or testing requirements as specified by the Secretary.CommentsClose CommentsPermalink





(C) NONMONETARY SANCTIONS-CommentsClose CommentsPermalink





(i) The regulations under this section shall provide for the denial, suspension or termination of such eligibility in the event of any failure to comply with the requirements promulgated hereunder.CommentsClose CommentsPermalink





(ii) Under such regulations, the Secretary shall establish procedures for the appeal of any determination under this paragraph.CommentsClose CommentsPermalink





(d) Penalty for Unauthorized Preparation of Returns-CommentsClose CommentsPermalink





(1) In promulgating the regulations pursuant to subsection (b), the Secretary shall impose a penalty of $1,000 for each Federal tax return, document, or other submission prepared by a tax return preparer who is not in compliance with the regulations promulgated under this section or who is suspended or disbarred from practice before the Department of the Treasury under such regulations. Such penalty shall be in addition to any other penalty which may be imposed.CommentsClose CommentsPermalink





(2) No penalty may be imposed under paragraph (1) with respect to any failure if it is shown that such failure is due to reasonable cause.CommentsClose CommentsPermalink





(e) Definition of Tax Return Preparer- For purposes of this section, the term `tax return preparer' has the meaning given by section 7701(a)(36), and includes any person requiring the purchase of services, a financial product or goods in lieu of or in addition to direct monetary payment.CommentsClose CommentsPermalink





(f) Public Awareness Campaign- The Secretary shall conduct a public information and consumer education campaign, utilizing paid advertising--CommentsClose CommentsPermalink





(1) to encourage taxpayers to use for Federal tax matters only professionals who establish their competency under the regulations promulgated under section 330 of title 31, United States Code, andCommentsClose CommentsPermalink





(2) to inform the public of the requirements that any compensated preparer of tax returns, documents, and submissions subject to the requirements under the regulations promulgated under such section must sign the return, document, or submission prepared for a fee and display notice of such preparer's compliance under such regulations.CommentsClose CommentsPermalink





(g) Effective Dates-CommentsClose CommentsPermalink





(1) IN GENERAL- The amendment made by this section shall take effect on the date of the enactment of the Act.CommentsClose CommentsPermalink





(2) REGULATIONS- The regulations required by section 330(d) of title 31, United States Code, shall be prescribed not later than 2 years after the date of the enactment of this Act.CommentsClose CommentsPermalink





(3) FULL IMPLEMENTATION- The Secretary, taking into consideration the complexity and magnitude of the requirements set forth under this Act, may delay full implementation of the regulations promulgated herein not later than the fifth filing season after the enactment of this Act.CommentsClose CommentsPermalink

SEC. 5. REFUND ANTICIPATION LOANS.

(a) In General- Chapter 77 (relating to miscellaneous provisions), as amended by section 2, is amended by adding at the end the following new section:CommentsClose CommentsPermalink

`SEC. 7530. REFUND ANTICIPATION LOANS.

`(a) Registration-CommentsClose CommentsPermalink





`(1) IN GENERAL- The Secretary shall by regulation require each refund loan facilitator to register annually with the Secretary.CommentsClose CommentsPermalink





`(2) REGISTRATION REQUIREMENTS- A registration shall under paragraph (1) shall include--CommentsClose CommentsPermalink





`(A) the name, address, and TIN of the refund loan facilitator, andCommentsClose CommentsPermalink





`(B) the fee schedule of the facilitator for the year.CommentsClose CommentsPermalink





`(3) DISPLAY OF REGISTRATION CERTIFICATE- The certificate of registration under paragraph (1) shall be displayed in the facility of the refund loan facilitator in the manner required by the Secretary.CommentsClose CommentsPermalink





`(b) Disclosure Requirements-CommentsClose CommentsPermalink





`(1) IN GENERAL- Each refund loan facilitator registered with the Secretary shall be subject to the requirements of paragraphs (2) through (5).CommentsClose CommentsPermalink





`(2) TAXPAYER EDUCATION- The requirements of this paragraph are that the refund loan facilitator makes available to consumers an informational pamphlet that--CommentsClose CommentsPermalink





`(A) sets forth options available for receiving tax refunds, presented from least expensive to most expensive, andCommentsClose CommentsPermalink





`(B) discusses short-term credit alternatives to utilizing refund loans.CommentsClose CommentsPermalink





`(3) NATURE OF THE TRANSACTION- The requirements of this paragraph are that, at the time of application for the refund loan, the refund loan facilitator specifically state in writing--CommentsClose CommentsPermalink





`(A) that the applicant is applying for a loan based on the applicant's anticipated income tax refund,CommentsClose CommentsPermalink





`(B) the expected time within which the loan will be paid to the applicant if such loan is approved,CommentsClose CommentsPermalink





`(C) the time frame in which income tax refunds are typically paid based upon the different filing options available to the applicant,CommentsClose CommentsPermalink





`(D) that there is no guarantee that a refund will be paid in full or received within a specified time period, and that the applicant is responsible for the repayment of the loan even if the refund is not paid in full or has been delayed, andCommentsClose CommentsPermalink





`(E) that the applicant may file an electronic return without applying for a refund loan and the fee for filing such an electronic return.CommentsClose CommentsPermalink





`(4) FEES, INTEREST AND AMOUNTS RECEIVED- The requirements of this paragraph are that, at the time of application for the refund loan, the refund loan facilitator discloses to the applicant all amounts to be received in connection with a refund loan. Such disclosure shall include--CommentsClose CommentsPermalink





`(A) a copy of the fee schedule of the refund loan facilitator,CommentsClose CommentsPermalink





`(B) the typical fees and interest rates (using annual percentage rates as defined by section 107 of the Truth in Lending Act (15 U.S.C. 1606)) for several typical amounts of such loans and of other types of consumer credit,CommentsClose CommentsPermalink





`(C) that the loan may have substantial fees and interest charges that may exceed those of other sources of credit, and the applicant should carefully consider--CommentsClose CommentsPermalink





`(i) whether such a loan is appropriate for the applicant, andCommentsClose CommentsPermalink





`(ii) other sources of credit.CommentsClose CommentsPermalink





`(D) typical fees and interest charges if a refund is not paid or delayed,CommentsClose CommentsPermalink





`(E) the amount of a fee (if any) that will be charged if the loan is not approved, andCommentsClose CommentsPermalink





`(F) administrative costs and any other amounts.CommentsClose CommentsPermalink





`(5) OTHER INFORMATION- The requirements of this paragraph are that the refund loan facilitator discloses any other information required to be disclosed by the Secretary.CommentsClose CommentsPermalink





`(6) DISCLOSURE REQUIREMENT- A disclosure under any of the preceding paragraphs of this subsection shall not be treated as meeting the requirements of the respective paragraph unless the disclosure is written in a manner calculated to be understood by the average consumer of refund anticipation loans and provides sufficient information (as determined in accordance with regulations prescribed by the Secretary) to allow the consumer to understand such options and credit alternatives.CommentsClose CommentsPermalink





`(c) Penalty-CommentsClose CommentsPermalink





`(1) IN GENERAL- There is hereby imposed a penalty on any refund loan facilitator who fails to register with the Secretary pursuant to subsection (a) or fails to meet a disclosure requirement under subsection (b).CommentsClose CommentsPermalink





`(2) AMOUNT OF PENALTY- The amount of the penalty imposed by paragraph (1) shall be the greater of--CommentsClose CommentsPermalink





`(A) $1,000, andCommentsClose CommentsPermalink





`(B) three times the amount of the refund loan and refund loan facilitator-determined fees charged with respect to each refund loan provided by the refund loan facilitator during the period in which the failure described in paragraph (1) occurred.CommentsClose CommentsPermalink





`(3) WAIVER BY SECRETARY- In the case of a failure which is due to reasonable cause and not to willful neglect, the Secretary may waive part or all of the penalty imposed by paragraph (1) to the extent that the payment of such penalty would be excessive or otherwise inequitable relative to the failure involved.CommentsClose CommentsPermalink





`(d) Conduct-CommentsClose CommentsPermalink





`(1) RULES OF CONDUCT- The Secretary shall prescribed rules of conduct for refund loan facilitators which are similar to the rules applicable to federally authorized tax practitioners (as defined by section 7525(a)(3)(A)) under part 10 of title 31, Code of Federal Regulations.CommentsClose CommentsPermalink





`(2) LIMITATION ON APPROVAL AS REFUND LOAN FACILITATOR- For such period as the Secretary (in his discretion) determines reasonable, the Secretary may not register any person as a refund loan facilitator under subsection (a) who the Secretary determines has engaged in any conduct that would warrant disciplinary action under the rules of conduct prescribed under paragraph (1) or under part 10 of title 31, Code of Federal Regulations.CommentsClose CommentsPermalink





`(e) Other Limitations Relating to Refund Anticipation Loans- In any case in which a taxpayer has consented to the release of the taxpayer's debt indicator to a refund loan facilitator, the Secretary may only provide information related to the debt indicator to a refund loan facilitator who is registered under subsection (a). For purposes of the preceding sentence, the term `debt indicator' means a notification provided through a tax return's acknowledgment file that a refund will be offset to repay debts for delinquent Federal or State taxes, student loans, child support, or other Federal agency debt.CommentsClose CommentsPermalink





`(f) Definitions- For purposes of this section--CommentsClose CommentsPermalink





`(1) REFUND LOAN FACILITATOR-CommentsClose CommentsPermalink





`(A) IN GENERAL- The term `refund loan facilitator' includes any electronic filing service provider who--CommentsClose CommentsPermalink





`(i) solicits for, processes, receives, or accepts delivery of an application for a refund anticipation loan, orCommentsClose CommentsPermalink





`(ii) facilitates the making of a refund anticipation loan in any other manner.CommentsClose CommentsPermalink





`(B) ELECTRONIC FILING SERVICE PROVIDER- The term `electronic filing service provider' includes any person who is an electronic return originator, intermediate service provider, or transmitter.CommentsClose CommentsPermalink





`(C) ELECTRONIC RETURN ORIGINATOR- The term `electronic return originator' includes a person who originates the electronic submission of income tax returns for another person.CommentsClose CommentsPermalink





`(D) INTERMEDIATE SERVICE PROVIDER- The term `intermediate service provider' includes a person who assists with processing return information between an electronic return originator (or the taxpayer in the case of online filing) and a transmitter.CommentsClose CommentsPermalink





`(E) TRANSMITTER- The term `transmitter' includes a person who sends the electronic return data directly to the Internal Revenue Service.CommentsClose CommentsPermalink





`(2) REFUND LOAN- The term `refund loan' includes any loan of money or any other thing of value to a taxpayer in connection with the taxpayer's anticipated receipt of a Federal tax refund. Such term includes a loan secured by the tax refund or an arrangement to repay a loan from the tax refund.CommentsClose CommentsPermalink





`(g) Regulations-CommentsClose CommentsPermalink





`(1) IN GENERAL- The Secretary may prescribe such regulations as necessary to carry out this subchapter.CommentsClose CommentsPermalink





`(2) BURDEN OF REGISTRATION- In promulgating such regulations, the Secretary shall minimize the burden and cost on the registrant.'.CommentsClose CommentsPermalink





(b) Public Awareness Campaign- The Secretary of the Treasury shall conduct a public information and consumer education campaign, utilizing paid advertising, to educate the public on making sound financial decisions with respect to refund loans (as defined by section 7529 of the Internal Revenue Code of 1986), including--CommentsClose CommentsPermalink





(1) the need to compare the rates and fees of such loans with the rates and fees of conventional loans,CommentsClose CommentsPermalink





(2) the need to compare the amount of money received under the loan after taking into consideration such costs and fees with the total amount of the refund, andCommentsClose CommentsPermalink





(3) where and how taxpayers may lodge complaints concerning refund loan facilitators.CommentsClose CommentsPermalink





(c) Clerical Amendment- The table of sections for chapter 77 is amended by adding at the end the following new item:CommentsClose CommentsPermalink





`Sec. 7530. Refund anticipation loans.'.CommentsClose CommentsPermalink





(d) Effective Dates-CommentsClose CommentsPermalink





(1) IN GENERAL- The amendments made by this section shall take effect on the date of the enactment of the Act.CommentsClose CommentsPermalink





(2) REGULATIONS- The regulations required by section 7530(g) of the Internal Revenue Code of 1986 shall be prescribed not later than 2 years after the date of the enactment of this Act.CommentsClose CommentsPermalink





(3) FULL IMPLEMENTATION- The Secretary of the Treasury, taking into consideration the complexity and magnitude of the requirements set forth under this Act, may delay full implementation of the regulations promulgated under such section not later than 5 years after the enactment of this Act.CommentsClose CommentsPermalink

SEC. 6. PREPARER PENALTIES WITH RESPECT TO PREPARATION OF RETURNS AND OTHER SUBMISSIONS.

(a) Inclusion of Other Submissions in Penalty Provisions-CommentsClose CommentsPermalink





(1) UNDERSTATEMENT OF TAXPAYER'S LIABILITY-CommentsClose CommentsPermalink





(A) IN GENERAL- Section 6694 (relating to understatement of taxpayer's liability by tax return preparer) is amended by striking `return or claim of refund' each place it appears and inserting `return, claim of refund, or other submission'.CommentsClose CommentsPermalink





(B) CONFORMING AMENDMENTS- Section 6694, as amended by paragraph (1), is amended by striking `return or claim' each place it appears and inserting `return, claim, or other submission'.CommentsClose CommentsPermalink





(2) OTHER ASSESSABLE PENALTIES-CommentsClose CommentsPermalink





(A) IN GENERAL- Section 6695 (relating to other assessable penalties with respect to the preparation of tax returns for other persons) is amended by striking `return or claim of refund' each place it appears and inserting `return, claim of refund, or other submission'.CommentsClose CommentsPermalink





(B) CONFORMING AMENDMENTS- Section 6695, as amended by paragraph (1), is amended by striking `return or claim' each place it appears and inserting `return, claim, or other submission'.CommentsClose CommentsPermalink





(b) Increase in Certain Other Assessable Penalty Amounts-CommentsClose CommentsPermalink





(1) IN GENERAL- Subsections (a), (b), and (c) of section 6695 (relating to other assessable penalties with respect to the preparation of income tax returns for other persons) are each amended by striking `$50' and inserting `$1,000'.CommentsClose CommentsPermalink





(2) REMOVAL OF ANNUAL LIMITATION- Subsections (a), (b), and (c) of section 6695 are each amended by striking the last sentence thereof.CommentsClose CommentsPermalink





(c) Review by the Treasury Inspector General for Tax Administration- Subparagraph (A) of section 7803(d)(2) is amended by striking `and' at the end of clause (iii), by striking the period at the end of clause (iv) and inserting `, and', and by adding at the end the following new clause:CommentsClose CommentsPermalink





`(v) a summary of the penalties assessed and collected during the reporting period under sections 6694 and 6695 and under the regulations promulgated under section 330 of title 31, United States Code, and a review of the procedures by which violations are identified and penalties are assessed under those sections,'.CommentsClose CommentsPermalink





(d) Additional Certification on Documents Other Than Returns-CommentsClose CommentsPermalink





(1) IDENTIFYING NUMBER REQUIRED FOR ALL SUBMISSIONS TO THE IRS BY TAX RETURN PREPARERS- The first sentence of paragraph (4) of section 6109(a) is amended by striking `return or claim for refund' and inserting `return, claim for refund, or other document'.CommentsClose CommentsPermalink





(2) EFFECTIVE DATE- The amendment made by paragraph (1) shall apply to documents filed after the date of the enactment of this Act.CommentsClose CommentsPermalink





(e) Coordination With Section 6060(a)- The Secretary of the Treasury shall coordinate the requirements under the regulations promulgated under section 330 of title 31, United States Code, with the return requirements of section 6060 of the Internal Revenue Code of 1986.CommentsClose CommentsPermalink





(f) Effective Date- The regulations required by this section shall be prescribed not later than one year after the date of the enactment of this Act.CommentsClose CommentsPermalink

SEC. 7. CLARIFICATION OF ENROLLED AGENT CREDENTIALS.

Section 330 of title 31, United States Code, as amended by section 4, is amended--CommentsClose CommentsPermalink





(1) by redesignating subsection (e) as subsection (f), andCommentsClose CommentsPermalink





(2) by inserting after subsection (d) the following new subsection:CommentsClose CommentsPermalink





`(e) Any enrolled agents properly licensed to practice as required under rules promulgated under subsection (a) shall be allowed to use the credentials or designation as `enrolled agent', `EA', or `E.A.'.'.CommentsClose CommentsPermalink

SEC. 8. PUBLIC AWARENESS.

(a) In General- Section 6103(k) (relating to disclosure of certain returns and return information for tax administration purposes) is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





`(10) DISCLOSURE OF RECOGNIZED, CERTIFIED, OR REGISTERED PERSONS; REVOCATION OF REGISTRATION- The Secretary shall furnish to the public--CommentsClose CommentsPermalink





`(A) the identity of any person who--CommentsClose CommentsPermalink





`(i) is an enrolled agent or is an attorney or certified public accountant who either has a power of attorney on file with the Internal Revenue Service or notifies the Internal Revenue Service of their status as a preparer of Federal tax returns,CommentsClose CommentsPermalink





`(ii) is certified under section 330(d) of title 31, United States Code, as a tax return preparer, orCommentsClose CommentsPermalink





`(iii) is registered as a refund loan facilitator pursuant to section 7529, andCommentsClose CommentsPermalink





`(B) information as to whether or not any person who is otherwise suspended or disbarred is no longer so recognized, certified, or registered (as the case may be).'.CommentsClose CommentsPermalink





(b) Effective Date- The amendment made by subsection (a) shall take effect not later than two years after the date of enactment of this Act.CommentsClose CommentsPermalink

SEC. 9. IMPROVED SERVICES FOR TAXPAYERS.

(a) In General- It is the sense of Congress that the Internal Revenue Service should within 5 years--CommentsClose CommentsPermalink





(1) reduce the time between receipt of an electronically filed return and issuance of a refund,CommentsClose CommentsPermalink





(2) provide free filing and preparation to low-income taxpayers,CommentsClose CommentsPermalink





(3) expand assistance to low-income taxpayers,CommentsClose CommentsPermalink





(4) allocate resources to assist low-income taxpayers in establishing accounts at financial institutions that receive direct deposits from the United States Treasury,CommentsClose CommentsPermalink





(5) deliver tax refunds on debit cards, prepaid cards, and other electronic means to assist individuals that do not have access to financial accounts or institutions, andCommentsClose CommentsPermalink





(6) establish a pilot program for mobile tax return preparation offices.CommentsClose CommentsPermalink





(b) Location of Service-CommentsClose CommentsPermalink





(1) IN GENERAL- The mobile tax return filing offices should be located in communities that the Secretary determines have a high incidence of taxpayers claiming the earned income tax credit, particularly in locations with few community volunteer tax preparation clinics.CommentsClose CommentsPermalink





(2) INDIAN RESERVATION- At least one mobile tax return filing office should be on or near an Indian reservation (as defined in section 168(j)(6) of the Internal Revenue Code of 1986).CommentsClose CommentsPermalink

SEC. 10. TAXPAYER ACCESS TO FINANCIAL INSTITUTIONS.

(a) Establishment of Program- The Secretary of the Treasury may award demonstration project grants (including multiyear awards) to eligible entities to provide accounts to individuals who currently do not have an account with a financial institution. The account would be held in a federally insured depository institution.CommentsClose CommentsPermalink





(b) Priority- Priority shall be given to demonstration project proposals that provide accounts at low or no cost and--CommentsClose CommentsPermalink





(1) that utilize new technologies such as the prepaid product to expand access to financial services, in particular for persons without bank accounts, with low access to financial services, or low utilization of mainstream financial services,CommentsClose CommentsPermalink





(2) that promote the development of new financial products and services that are adequate to improve access to wealth building financial services, which help integrate more Americans into the financial mainstream,CommentsClose CommentsPermalink





(3) that promote education for these persons and depository institutions concerning the availability and use of financial services for and by such persons, andCommentsClose CommentsPermalink





(4) that include other such activities and projects as the Secretary may determine are consistent with the purpose of this section.CommentsClose CommentsPermalink





(c) Eligible Entities-CommentsClose CommentsPermalink





(1) IN GENERAL- An entity is eligible to receive a grant under this section if such an entity is--CommentsClose CommentsPermalink





(A) an organization described in section 501(c)(3) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code,CommentsClose CommentsPermalink





(B) a federally insured depository institution,CommentsClose CommentsPermalink





(C) an agency of a State or local government,CommentsClose CommentsPermalink





(D) a community development financial institution,CommentsClose CommentsPermalink





(E) an Indian tribal organization,CommentsClose CommentsPermalink





(F) an Alaska Native Corporation,CommentsClose CommentsPermalink





(G) a Native Hawaiian organization,CommentsClose CommentsPermalink





(H) an organization described in 501(c)(5), and exempt from tax under section 501(a), of such Code,CommentsClose CommentsPermalink





(I) a nonbank financial service provider, orCommentsClose CommentsPermalink





(J) a partnership comprised of 1 or more of the entities described in the preceding subparagraphs.CommentsClose CommentsPermalink





(2) DEFINITIONS- For purposes of this section--CommentsClose CommentsPermalink





(A) FEDERALLY INSURED DEPOSITORY INSTITUTION- The term `federally insured depository institution' means any insured depository institution (as defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813)) and any insured credit union (as defined in section 101 of the Federal Credit Union Act (12 U.S.C. 1752)).CommentsClose CommentsPermalink





(B) COMMUNITY DEVELOPMENT FINANCIAL INSTITUTION- The term `community development financial institution' means any organization that has been certified as such pursuant to section 1805.201 of title 12, Code of Federal Regulations.CommentsClose CommentsPermalink





(C) ALASKA NATIVE CORPORATION- The term `Alaska Native Corporation' has the same meaning as the term `Native Corporation' under section 3(m) of the Alaska Native Claims Settlement Act (43 U.S.C. 1602(m)).CommentsClose CommentsPermalink





(D) NATIVE HAWAIIAN ORGANIZATION- The term `Native Hawaiian organization' means any organization that--CommentsClose CommentsPermalink





(i) serves and represents the interests of Native Hawaiians, andCommentsClose CommentsPermalink





(ii) has as a primary and stated purpose the provision of services to Native Hawaiians.CommentsClose CommentsPermalink





(E) LABOR ORGANIZATION- The term `labor organization' means an organization--CommentsClose CommentsPermalink





(i) in which employees participate,CommentsClose CommentsPermalink





(ii) which exists for the purpose, in whole or in part, of dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work, andCommentsClose CommentsPermalink





(iii) which is described in section 501(c)(5) of the Internal Revenue Code of 1986.CommentsClose CommentsPermalink





(F) NONBANK FINANCIAL SERVICE PROVIDER- The term `nonbank financial service provider' mean an entity that engages in financial services activities, as authorized under the Federal Reserve Board, 12 Code of Federal Regulations Part 225, Regulation Y.CommentsClose CommentsPermalink





(d) Application- An eligible entity shall submit an application to the Secretary of the Treasury in such form and containing such information as the Secretary may require.CommentsClose CommentsPermalink





(e) Evaluation and Report- For each fiscal year in which a grant is awarded under this section, the Secretary of the Treasury shall submit a report to Congress containing a description of the activities funded, amounts distributed, and measurable results, as appropriate and available.CommentsClose CommentsPermalink





(f) Power and Authority of the Secretary-CommentsClose CommentsPermalink





(1) ASSISTANCE- Subject to appropriations, the Secretary of the Treasury may provide financial and technical assistance to awardees for expanding the distribution of financial services, including through financial services electronic networks.CommentsClose CommentsPermalink





(2) RESEARCH AND DEVELOPMENT- The Secretary of the Treasury may conduct or support such research and development as the Secretary considers appropriate in order to further the purpose of this section, including the collection of information about access to financial services.CommentsClose CommentsPermalink





(3) REGULATIONS- The Secretary of the Treasury is authorized to promulgate regulations to implement and administer the program under this section.CommentsClose CommentsPermalink





(g) Study on Delivery of Tax Refunds-CommentsClose CommentsPermalink





(1) IN GENERAL- The Secretary of the Treasury, in consultation with the National Taxpayer Advocate, shall conduct a study on the payment opportunities 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.CommentsClose CommentsPermalink





(2) REPORT- Not later than 1 year after the date of the enactment of this Act, the Secretary of the Treasury shall submit a report to Congress containing the result of the study conducted under subsection (a).CommentsClose CommentsPermalink