A bill to amend the Internal Revenue Code of 1986 to double the period of limitations for returns involving offshore secrecy jurisdictions, to modify certain other provisions relating to the statute of limitations, and for other purposes.

Summary: Amends the Internal Revenue Code to: (1) establish a six year limitation period on assessment and collection of tax for tax returns involving offshore secrecy jurisdictions (defined as foreign jurisdictions which unreasonably restrict information required to enforce U.S. tax laws and which have ineffective information exchange practices); (2) suspend the limitation period for assessment and collection of tax while a summons for tax records involving a foreign jurisdiction is pending; (3) extend the limitation period during any failure by a taxpayer to give notice of certain foreign transactions; and (4) extend the period for collection of tax after assessment in the case of a willful attempt to evade or defeat payment of tax to 10 years after such attempt.

SECTION 1. SIX-YEAR STATUTE OF LIMITATIONS FOR INVESTIGATIONS INVOLVING 
              OFFSHORE SECRECY JURISDICTIONS.

    (a) In General.--Section 6501(c) of the Internal Revenue Code of 
1986 (relating to exceptions from limitations on assessment and 
collection) is amended by adding at the end the following new 
paragraph:
            ``(11) Returns involving offshore secrecy jurisdictions.--
        If, for any taxable year, any item of a taxpayer (other than an 
        entity the ownership interests in which are regularly traded on 
        an established securities market) is an offshore secrecy 
        jurisdiction item (as defined in subsection (n)), the tax 
        imposed by this title for such taxable year may be assessed, or 
        a proceeding in court for the collection of such tax may be 
        begun without assessment, at any time within 6 years after the 
        return of such tax was filed.''.
    (b) Terms Relating to Offshore Secrecy Jurisdiction Items.--Section 
6501 of the Internal Revenue Code of 1986 (relating to limitations on 
assessment and collection) is amended by redesignating subsection (n) 
as subsection (o) and by inserting after subsection (m) the following 
new subsection:
    ``(n) Terms Relating to Offshore Secrecy Jurisdiction Items.--For 
purposes of subsection (c)(11)--
            ``(1) Offshore secrecy jurisdiction item.--The term 
        `offshore secrecy jurisdiction item' means any item of a 
        taxpayer which is directly or indirectly attributable to any 
        account, entity, or transaction involving an offshore secrecy 
        jurisdiction. Such term shall include any item directly or 
        indirectly attributable to--
                    ``(A) the formation or ownership by the taxpayer of 
                any applicable account or entity (or any interest in 
                such account or entity),
                    ``(B) the transfer of any money or other property 
                by the taxpayer to any applicable account or entity or 
                the transfer by the taxpayer of any interest in such 
                account or entity, or
                    ``(C) the receipt, or use, by the taxpayer of any 
                money or other property from any applicable account or 
                entity.
            ``(2) Applicable account or entity.--The term `applicable 
        account or entity' means any financial account, or any entity 
        (including a trust, corporation, limited liability company, 
        partnership, or foundation), which is formed, located, 
        domiciled, or operating in an offshore secrecy jurisdiction. 
        Such term shall not include an entity the ownership interests 
        in which are regularly traded on an established securities 
        market.
            ``(3) Offshore secrecy jurisdiction.--
                    ``(A) In general.--The term `offshore secrecy 
                jurisdiction' means any foreign jurisdiction which the 
                Secretary determines for purposes of this subsection is 
                a jurisdiction which--
                            ``(i) has corporate, business, bank, or tax 
                        secrecy rules or practices which, in the 
                        judgment of the Secretary, unreasonably 
                        restrict the ability of the United States to 
                        obtain information relevant to the enforcement 
                        of this title, and
                            ``(ii) does not have effective information 
                        exchange practices.
                    ``(B) Secrecy or confidentiality rules and 
                practices.--For purposes of subparagraph (A)(i), 
                corporate, business, bank, or tax secrecy or 
                confidentiality rules and practices include both formal 
                laws and regulations and informal government or 
                business practices which have the effect of inhibiting 
                access of law enforcement and tax administration 
                authorities to information regarding beneficial 
                ownership and other financial information.
                    ``(C) Ineffective information exchange practices.--
                For purposes of subparagraph (A)(ii), a jurisdiction 
                shall be deemed to have ineffective information 
                exchange practices unless the Secretary determines, on 
                an annual basis, that--
                            ``(i) such jurisdiction has in effect a 
                        treaty or other information exchange agreement 
                        with the United States which provides for the 
                        prompt and obligatory exchange of such 
                        information which is relevant for carrying out 
                        the provisions of the treaty or agreement or 
                        the administration or enforcement of this 
                        title,
                            ``(ii) during the 12-month period preceding 
                        the annual determination, the exchange of 
                        information between the United States and such 
                        jurisdiction was in practice adequate to carry 
                        out the provisions of the treaty or agreement; 
                        and
                            ``(iii) during the 12-month period 
                        preceding the annual determination, such 
                        jurisdiction was not identified by an 
                        intergovernmental group or organization of 
                        which the United States is a member as 
                        uncooperative with international tax 
                        enforcement or information exchange and the 
                        United States concurs in such 
                        identification.''.

SEC. 2. SUSPENSION OF STATUTE OF LIMITATIONS WHILE SUMMONS FOR FOREIGN 
              BASED RECORDS IS PENDING.

    Section 6503 of the Internal Revenue Code of 1986 (relating to 
suspension of running of period of limitation) is amended by 
redesignating subsection (k) as subsection (l) and by inserting after 
subsection (j) the following new subsection:
    ``(l) Suspension While Summons for Records of Foreign Account, 
Entity, or Transaction Is Pending.--
            ``(1) In general.--If any summons is issued by the 
        Secretary to a taxpayer (or to any other person to whom the 
        taxpayer has transferred records) with respect to a return of 
        tax by such taxpayer, and such summons requires the production 
        of records relating to an account, entity, or transaction 
        involving a foreign jurisdiction, the running of any period of 
        limitations under section 6501 on the assessment of such tax 
        shall be suspended during any judicial enforcement period (as 
        defined in subsection (j)(3)) with respect to such summons and 
        for 120 days thereafter. This subsection shall not apply to a 
        summons for the production of records relating to a foreign 
        entity the ownership interests in which are regularly traded on 
        an established securities market designated by the Secretary 
        for purposes of this subsection.
            ``(2) Specific application.--Except as provided in the last 
        sentence of paragraph (1), this subsection shall apply in any 
        case where the summons referred to in paragraph (1) relates 
        to--
                    ``(A) a financial account, or an entity (including 
                a trust, corporation, limited liability company, 
                partnership, or foundation), formed, located, domiciled 
                or operating in a foreign jurisdiction, or
                    ``(B) a case in which the taxpayer directly or 
                indirectly transferred money or other property to, or 
                received money or property from, such an account or 
                entity or any other person in a foreign 
                jurisdiction.''.

SEC. 3. EXTENSION OF STATUTE OF LIMITATIONS DURING FAILURE TO NOTIFY 
              SECRETARY OF CERTAIN FOREIGN TRANSFERS.

    Section 6501(c)(8) of the Internal Revenue Code of 1986 (relating 
to failure to notify Secretary of certain foreign transfers) is amended 
by striking ``event'' and inserting ``tax return''.

SEC. 4. EXCEPTION TO STATUTE OF LIMITATIONS ON COLLECTION IN CASE OF 
              ATTEMPT TO EVADE COLLECTION.

    Section 6502 of the Internal Revenue Code of 1986 (relating to 
collection after assessment) is amended by adding at the end the 
following new subsection:
    ``(c) Exception in Case of Attempt to Evade Payment.--In a case of 
a willful attempt in any manner to evade or defeat the payment of any 
tax that has been assessed under this title, the time for collection of 
such tax by levy or by a proceeding in court shall not expire before 
the date which is 10 years after such attempt.''.

SEC. 5. EFFECTIVE DATES.

    (a) In General.--The amendments made by this Act (other than 
section 4) shall apply to--
            (1) returns filed after the date of the enactment of this 
        Act; and
            (2) returns filed on or before such date if the period 
        specified in section 6501 of the Internal Revenue Code of 1986 
        (determined without regard to such amendments) for assessment 
        of such taxes has not expired as of such date.
    (b) Collections.--The amendment made by section 4 shall apply to--
            (1) assessments made after the date of the enactment of 
        this Act; and
            (2) assessments made on or before such date if the period 
        specified in section 6502 of the Internal Revenue Code of 1986 
        (determined without regard to such amendment) for collection of 
        such taxes has not expired as of such date.