II 

115TH CONGRESS 

1ST SESSION S. 762 

To amend the Internal Revenue Code of 1986 to reform provisions relating 

to whistleblowers. 

IN THE SENATE OF THE UNITED STATES 

MARCH 29, 2017 

Mr. GRASSLEY (for himself and Mr. WYDEN) introduced the following bill; 

which was read twice and referred to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to reform 

provisions relating to whistleblowers. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘IRS Whistleblower Im5 provements Act of 2017’’. 

6 SEC. 2. WHISTLEBLOWER REFORMS. 

7 (a) MODIFICATIONS TO DISCLOSURE RULES FOR

8 WHISTLEBLOWERS.— 


lotter on DSK5VPTVN1PROD with BILLS
2 

•S 762 IS

1 (1) IN GENERAL.—Section 6103(k) of the In2 ternal Revenue Code of 1986 is amended by adding 

3 at the end the following new paragraph: 

4 ‘‘(13) DISCLOSURE TO WHISTLEBLOWERS.— 

5 ‘‘(A) IN GENERAL.—The Secretary may 

6 disclose, to any individual providing information 

7 relating to any purpose described in paragraph 

8 (1) or (2) of section 7623(a), return informa9 tion related to the investigation of any taxpayer 

10 with respect to whom the individual has pro11 vided such information, but only to the extent 

12 that such disclosure is necessary in obtaining 

13 information, which is not otherwise reasonably 

14 available, with respect to the correct determina15 tion of tax liability for tax, or the amount to be 

16 collected with respect to the enforcement of any 

17 other provision of this title. 

18 ‘‘(B) UPDATES ON WHISTLEBLOWER IN19 VESTIGATIONS.—The Secretary shall disclose to 

20 an individual providing information relating to 

21 any purpose described in paragraph (1) or (2) 

22 of section 7623(a) the following: 

23 ‘‘(i) Not later than 30 days after a 

24 case for which the individual has provided 

25 information has been referred for an audit 


lotter on DSK5VPTVN1PROD with BILLS
3 

•S 762 IS

1 or examination, a notice with respect to 

2 such referral. 

3 ‘‘(ii) Not later than 30 days after a 

4 taxpayer with respect to whom the indi5 vidual has provided information has made 

6 a payment of tax with respect to tax liabil7 ity to which such information relates, a no8 tice with respect to such payment. 

9 ‘‘(iii) Subject to such requirements 

10 and conditions as are prescribed by the 

11 Secretary, upon a written request by such 

12 individual— 

13 ‘‘(I) information on the status 

14 and stage of any investigation or ac15 tion related to such information, and 

16 ‘‘(II) in the case of a determina17 tion of the amount of any award 

18 under section 7623(b), the reasons for 

19 such determination. 

20 Clause (iii) shall not apply to any information 

21 if the Secretary determines that disclosure of 

22 such information would seriously impair Fed23 eral tax administration. Information described 

24 in clauses (i), (ii), and (iii) may be disclosed to 

25 a designee of the individual providing such inVerDate Sep 11 2014 23:36 Mar 31, 2017 Jkt 069200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S762.IS S762

lotter on DSK5VPTVN1PROD with BILLS
4 

•S 762 IS

1 formation in accordance with guidance provided 

2 by the Secretary.’’. 

3 (2) CONFORMING AMENDMENTS.— 

4 (A) CONFIDENTIALITY OF INFORMA5 TION.—Section 6103(a)(3) of such Code is 

6 amended by striking ‘‘subsection (k)(10)’’ and 

7 inserting ‘‘paragraph (10) or (13) of subsection 

8 (k)’’. 

9 (B) PENALTY FOR UNAUTHORIZED DIS10 CLOSURE.—Section 7213(a)(2) of such Code is 

11 amended by striking ‘‘(k)(10)’’ and inserting 

12 ‘‘(k)(10) or (13)’’. 

13 (C) COORDINATION WITH AUTHORITY TO

14 DISCLOSE FOR INVESTIGATIVE PURPOSES.— 

15 Section 6103(k)(6) of such Code is amended by 

16 adding at the end the following new sentence: 

17 ‘‘This paragraph shall not apply to any disclo18 sure to an individual providing information re19 lating to any purpose described in paragraph 

20 (1) or (2) of section 7623(a) which is made 

21 under paragraph (13)(A).’’. 

22 (b) PROTECTION AGAINST RETALIATION.—Section 

23 7623 of the Internal Revenue Code of 1986 is amended 

24 by adding at the end the following new subsection: 


lotter on DSK5VPTVN1PROD with BILLS
5 

•S 762 IS

1 ‘‘(c) CIVIL ACTION TO PROTECT AGAINST RETALIA2 TION CASES.— 

3 ‘‘(1) ANTI-RETALIATION WHISTLEBLOWER PRO4 TECTION FOR EMPLOYEES.—No employer or any of5 ficer, employee, contractor, subcontractor, or agent 

6 of such employer may discharge, demote, suspend, 

7 threaten, harass, or in any other manner discrimi8 nate against an employee in the terms and condi9 tions of employment (including through an act in the 

10 ordinary course of such employee’s duties) in re11 prisal for any lawful act done by the employee— 

12 ‘‘(A) to provide information, cause infor13 mation to be provided, or otherwise assist in an 

14 investigation regarding underpayment of tax or 

15 any conduct which the employee reasonably be16 lieves constitutes a violation of the internal rev17 enue laws or any provision of Federal law relat18 ing to tax fraud, when the information or as19 sistance is provided to the Internal Revenue 

20 Service, the Secretary of the Treasury, the 

21 Treasury Inspector General for Tax Adminis22 tration, the Comptroller General of the United 

23 States, the Department of Justice, the United 

24 States Congress, a person with supervisory au25 thority over the employee, or any other person 


lotter on DSK5VPTVN1PROD with BILLS
6 

•S 762 IS

1 working for the employer who has the authority 

2 to investigate, discover, or terminate mis3 conduct, or 

4 ‘‘(B) to testify, participate in, or otherwise 

5 assist in any administrative or judicial action 

6 taken by the Internal Revenue Service relating 

7 to an alleged underpayment of tax or any viola8 tion of the internal revenue laws or any provi9 sion of Federal law relating to tax fraud. 

10 ‘‘(2) ENFORCEMENT ACTION.— 

11 ‘‘(A) IN GENERAL.—A person who alleges 

12 discharge or other reprisal by any person in vio13 lation of paragraph (1) may seek relief under 

14 paragraph (3) by— 

15 ‘‘(i) filing a complaint with the Sec16 retary of Labor, or 

17 ‘‘(ii) if the Secretary of Labor has not 

18 issued a final decision within 180 days of 

19 the filing of the complaint and there is no 

20 showing that such delay is due to the bad 

21 faith of the claimant, bringing an action at 

22 law or equity for de novo review in the ap23 propriate district court of the United 

24 States, which shall have jurisdiction over 


lotter on DSK5VPTVN1PROD with BILLS
7 

•S 762 IS

1 such an action without regard to the 

2 amount in controversy. 

3 ‘‘(B) PROCEDURE.— 

4 ‘‘(i) IN GENERAL.—An action under 

5 subparagraph (A)(ii) shall be governed 

6 under the rules and procedures set forth in 

7 section 42121(b) of title 49, United States 

8 Code. 

9 ‘‘(ii) EXCEPTION.—Notification made 

10 under section 42121(b)(1) of title 49, 

11 United States Code, shall be made to the 

12 person named in the complaint and to the 

13 employer. 

14 ‘‘(iii) BURDENS OF PROOF.—An ac15 tion brought under subparagraph (A)(ii) 

16 shall be governed by the legal burdens of 

17 proof set forth in section 42121(b) of title 

18 49, United States Code, except that in ap19 plying such section— 

20 ‘‘(I) ‘behavior described in para21 graph (1)’ shall be substituted for ‘be22 havior described in paragraphs (1) 

23 through (4) of subsection (a)’ each 

24 place it appears in paragraph (2)(B) 

25 thereof, and 


lotter on DSK5VPTVN1PROD with BILLS
8 

•S 762 IS

1 ‘‘(II) ‘a violation of paragraph 

2 (1)’ shall be substituted for ‘a viola3 tion of subsection (a)’ each place it 

4 appears. 

5 ‘‘(iv) STATUTE OF LIMITATIONS.—A 

6 complaint under subparagraph (A)(i) shall 

7 be filed not later than 180 days after the 

8 date on which the violation occurs. 

9 ‘‘(v) JURY TRIAL.—A party to an ac10 tion brought under subparagraph (A)(ii) 

11 shall be entitled to trial by jury. 

12 ‘‘(3) REMEDIES.— 

13 ‘‘(A) IN GENERAL.—An employee pre14 vailing in any action under paragraph (2)(A) 

15 shall be entitled to all relief necessary to make 

16 the employee whole. 

17 ‘‘(B) COMPENSATORY DAMAGES.—Relief 

18 for any action under subparagraph (A) shall in19 clude— 

20 ‘‘(i) reinstatement with the same se21 niority status that the employee would 

22 have had, but for the reprisal, 

23 ‘‘(ii) the sum of 200 percent of the 

24 amount of back pay and 100 percent of all 

25 lost benefits, with interest, and 


lotter on DSK5VPTVN1PROD with BILLS
9 

•S 762 IS

1 ‘‘(iii) compensation for any special 

2 damages sustained as a result of the re3 prisal, including litigation costs, expert wit4 ness fees, and reasonable attorney fees. 

5 ‘‘(4) RIGHTS RETAINED BY EMPLOYEE.—Noth6 ing in this section shall be deemed to diminish the 

7 rights, privileges, or remedies of any employee under 

8 any Federal or State law, or under any collective 

9 bargaining agreement. 

10 ‘‘(5) NONENFORCEABILITY OF CERTAIN PROVI11 SIONS WAIVING RIGHTS AND REMEDIES OR REQUIR12 ING ARBITRATION OF DISPUTES.— 

13 ‘‘(A) WAIVER OF RIGHTS AND REM14 EDIES.—The rights and remedies provided for 

15 in this subsection may not be waived by any 

16 agreement, policy form, or condition of employ17 ment, including by a predispute arbitration 

18 agreement. 

19 ‘‘(B) PREDISPUTE ARBITRATION AGREE20 MENTS.—No predispute arbitration agreement 

21 shall be valid or enforceable, if the agreement 

22 requires arbitration of a dispute arising under 

23 this subsection.’’. 

24 (c) EFFECTIVE DATE.— 


lotter on DSK5VPTVN1PROD with BILLS
10 

•S 762 IS

1 (1) IN GENERAL.—The amendments made by 

2 subsection (a) shall apply to disclosures made after 

3 the date of the enactment of this Act. 

4 (2) CIVIL PROTECTION.—The amendment made 

5 by subsection (b) shall take effect on the date of the 

6 enactment of this Act. 

Æ 


lotter on DSK5VPTVN1PROD with BILLS