To amend the Internal Revenue Code of 1986 to require greater transparency of corporate tax accounting measures, to facilitate analysis of financial statements, to permit inspection of true corporate tax liability and understand the tax strategies undertaken by corporations, to discourage abusive tax sheltering activities, and to restore investor confidence in publicly traded corporations.

Summary: Corporate Accountability Tax Gap Act of 2005 - Amends the Internal Revenue Code to provide for public disclosure of certain information of publicly traded corporations, including: (1) net corporate income tax and taxable income as shown on the corporation's current year tax return; (2) adjusted book income; and (3) differences between taxable income and adjusted book income due to certain transactions, depreciation differences, stock options, and other factors. Directs the Secretary of the Treasury to conduct a study of corporate tax shelter activity.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Corporate Accountability Tax Gap Act 
of 2005''.

SEC. 2. AVAILABILITY OF CERTAIN TAX INFORMATION OF PUBLICLY TRADED 
              CORPORATIONS.

    (a) In General.--Section 6103 of the Internal Revenue Code of 1986 
is amended by redesignating subsection (q) as subsection (r) and by 
inserting after subsection (p) the following new subsection:
    ``(q) Public Disclosure of Certain Corporate Tax Information.--
            ``(1) In general.--Each specified corporation shall, on the 
        date that it files its return of tax imposed by chapter 1 for 
        each taxable year, electronically file the information 
        described in paragraph (2) for such year. Not later than 30 
        days after receiving such information, the Secretary shall make 
        it electronically available to the public as a single document 
        and as part of a searchable database as provided in paragraph 
        (3).
            ``(2) Information.--The information described in this 
        paragraph with respect to a corporation for a taxable year are 
        the following items:
                    ``(A) Net corporate income tax as shown on the 
                return for such year.
                    ``(B) Amount shown as Federal income tax expense on 
                its annual statement (if any) filed with the Securities 
                and Exchange Commission.
                    ``(C) Taxable income as shown on such return.
                    ``(D) Adjusted book income.
                    ``(E) The portion of the total difference between 
                taxable income and adjusted book income which is 
                attributable to each of the following:
                            ``(i) Transactions disclosable under 
                        section 6011.
                            ``(ii) Depreciation differences.
                            ``(iii) Stock options.
                            ``(iv) Income from entities consolidated 
                        for book income purposes but not for Federal 
                        income tax purposes.
                            ``(v) Income from pension funds or tax-
                        exempt bonds.
                            ``(vi) Other items, pursuant to regulations 
                        prescribed by the Secretary.
                    ``(F) An explanation of the differences between 
                taxable income and adjusted book income that are 
                attributable to one or more of the following:
                            ``(i) Transactions referred to in 
                        subparagraph (E)(i).
                            ``(ii) Other items specified in regulations 
                        referred to in subparagraph (E)(vi).
                            ``(iii) Any additional information that the 
                        Secretary determines would be useful in 
                        enforcing this title, including any information 
                        which is an indicia of abusive tax avoidance 
                        schemes.
            ``(3) Access.--The Secretary shall make the information 
        described in paragraph (2) accessible electronically by a 
        search which uses the following items:
                    ``(A) Name of the corporation.
                    ``(B) Headquarters location by postal zip code.
                    ``(C) Each category of such information.
                    ``(D) Taxable year or other time period to which 
                such information relates.
                    ``(E) The CUSIP identification number under which 
                the corporation files reports with the Securities and 
                Exchange Commission.
            ``(4) Specified corporation.--For purposes of this 
        subsection, the term `specified corporation' means--
                    ``(A) any corporation issuing any class of 
                securities required to be registered under section 12 
                of the Securities Exchange Act of 1934, and
                    ``(B) any other domestic corporation which is a 
                member of an affiliated group (as defined in section 
                1504) which includes a corporation described in 
                subparagraph (A).
        In the case of a corporation which is a member of an affiliated 
        group filing a consolidated return, the term `specified 
        corporation' means such group and not each member thereof.
            ``(5) Other definitions.--For purposes of this subsection--
                    ``(A) Net corporate income tax.--The term `net 
                corporate income tax' means the sum of regular tax 
                liability (as defined by section 26(b)) and the tax 
                imposed by section 55, reduced by the credits allowable 
                under part IV of subchapter A of chapter 1.
                    ``(B) Adjusted book income.--The term `adjusted 
                book income' means book income reported to the 
                Securities and Exchange Commission (or to shareholders) 
                without reduction for preferred stock dividends, 
                Federal income taxes, and income, war profits, or 
                excess profits taxes imposed by any foreign country or 
                possession of the United States.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 3. STUDY OF TAX SHELTER ACTIVITY.

    (a) Study.--The Secretary of the Treasury (or the Secretary's 
delegate) shall, in coordination with the Joint Committee on Taxation, 
Committee on Finance of the Senate, and the Committee on Ways and Means 
of the House of Representatives, conduct a study of recent known 
corporate tax shelter activity, including information gained from the 
tax shelter amnesty announced in Internal Revenue Service Announcement 
2002-02 and from the study of Enron tax returns by the Committee on 
Finance of the Senate.
    (b) Report.--Not later than 1 year after the date of the enactment 
of this Act, the report of such study shall be submitted to the 
Committee on Finance of the Senate and the Committee on Ways and Means 
of the House of Representatives. Such report shall include 
recommendations (if any) for--
            (1) requiring additional information on the reconciliation 
        of book/tax accounting and publicly disclosing that additional 
        information under section 6103(q) of the Internal Revenue Code 
        of 1986, and
            (2) publicly disclosing additional information from the 
        corporate income tax return.
Such report also shall include a description of the actions that such 
Secretary has taken toward implementing any such recommendations.