Refundable Child Tax Credit Eligibility Verification Reform Act of 2013

Summary: Refundable Child Tax Credit Eligibility Verification Reform Act of 2013 - Amends the Internal Revenue Code, with respect to the child tax credit, to require taxpayers claiming such credit to provide their social security numbers on their tax returns.  Prohibits taxpayers who improperly claimed such credit in a previous year from claiming such credit during a disallowance period of: (1) 2 years for claims made with reckless or intentional disregard of rules governing such credit, or (2) 10 years for fraudulent claims. Requires the Secretary of the Treasury to prescribe a form for completion by paid income tax preparers in connection with claims for the refundable portion of the child tax credit. Imposes a penalty on preparers who fail to comply with due diligence requirements for claiming the refundable portion of the credit. 

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Refundable Child Tax Credit 
Eligibility Verification Reform Act of 2013''.

SEC. 2. SOCIAL SECURITY NUMBER REQUIRED TO CLAIM THE REFUNDABLE PORTION 
              OF THE CHILD TAX CREDIT.

    (a) In General.--Subsection (d) of section 24 of the Internal 
Revenue Code of 1986 is amended by inserting after paragraph (4) the 
following new paragraph:
            ``(5) Identification requirement with respect to 
        taxpayer.--
                    ``(A) In general.--Paragraph (1) shall not apply to 
                any taxpayer for any taxable year unless the taxpayer 
                includes the taxpayer's social security number on the 
                return of tax for such taxable year.
                    ``(B) Joint returns.--In the case of a joint 
                return, the requirement of subparagraph (A) shall be 
                treated as met if the social security number of either 
                spouse is included on such return.
                    ``(C) Limitation.--Subparagraph (A) shall not apply 
                to the extent the tentative minimum tax (as defined in 
                section 55(b)(1)(A)) exceeds the credit allowed under 
                section 32.''.
    (b) Omission Treated as Mathematical or Clerical Error.--
Subparagraph (I) of section 6213(g)(2) of such Code is amended to read 
as follows:
                    ``(I) an omission of a correct social security 
                number required under section 24(d)(5) (relating to 
                refundable portion of child tax credit), or a correct 
                TIN under section 24(e) (relating to child tax credit), 
                to be included on a return,''.
    (c) Conforming Amendment.--Subsection (e) of section 24 of such 
Code is amended by inserting ``With Respect to Qualifying Children'' 
after ``Identification Requirement'' in the heading thereof.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 3. RESTRICTIONS ON TAXPAYERS WHO IMPROPERLY CLAIMED REFUNDABLE 
              PORTION OF THE CHILD TAX CREDIT IN PRIOR YEAR.

    (a) In General.--Subsection (d) of section 24 of the Internal 
Revenue Code of 1986 is amended by inserting after paragraph (5) the 
following new paragraph:
            ``(6) Restrictions on taxpayers who improperly claimed 
        credit in prior year.--
                    ``(A) Taxpayers making prior fraudulent or reckless 
                claims.--
                            ``(i) In general.--No credit shall be 
                        allowed under this subsection for any taxable 
                        year in the disallowance period.
                            ``(ii) Disallowance period.--For purposes 
                        of clause (i), the disallowance period is--
                                    ``(I) the period of 10 taxable 
                                years after the most recent taxable 
                                year for which there was a final 
                                determination that the taxpayer's claim 
                                of credit under this subsection was due 
                                to fraud, and
                                    ``(II) the period of 2 taxable 
                                years after the most recent taxable 
                                year for which there was a final 
                                determination that the taxpayer's claim 
                                of credit under this subsection was due 
                                to reckless or intentional disregard of 
                                rules and regulations (but not due to 
                                fraud).
                    ``(B) Taxpayers making improper prior claims.--In 
                the case of a taxpayer who is denied credit under this 
                subsection for any taxable year as a result of the 
                deficiency procedures under subchapter B of chapter 63, 
                no credit shall be allowed under this subsection for 
                any subsequent taxable year unless the taxpayer 
                provides such information as the Secretary may require 
                to demonstrate eligibility for such credit.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.

SEC. 4. CHECKLIST FOR PAID PREPARERS TO VERIFY ELIGIBILITY FOR 
              REFUNDABLE PORTION OF THE CHILD TAX CREDIT; PENALTY FOR 
              FAILURE TO MEET DUE DILIGENCE REQUIREMENTS.

    (a) In General.--The Secretary of the Treasury (or the Secretary's 
delegate) shall prescribe a form (similar to Form 8867) which is 
required to be completed by paid income tax return preparers in 
connection with claims for the refundable portion of the child tax 
credit under section 24(d) of the Internal Revenue Code of 1986.
    (b) Penalty.--Section 6695 of the Internal Revenue Code of 1986 
(relating to other assessable penalties with respect to the preparation 
of tax returns for other persons) is amended by adding at the end the 
following new subsection:
    ``(h) Failure To Be Diligent in Determining Eligibility for 
Refundable Portion of Child Tax Credit.--Any person who is a tax return 
preparer with respect to any return or claim for refund who fails to 
comply with due diligence requirements imposed by the Secretary by 
regulations with respect to determining eligibility for, or the amount 
of, the credit allowable by section 24(d) shall pay a penalty of $500 
for each such failure.''.
    (c) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.