I

106TH CONGRESS

2D SESSION H. R. 5463

To amend the Internal Revenue Code of 1986 to affirm the confidentiality

of closing and similar agreements and agreements with foreign governments.

IN THE HOUSE OF REPRESENTATIVES

OCTOBER 12, 2000

Mr. HOUGHTON (for himself, Mr. SAM JOHNSON of Texas, and Mr. LEVIN)

introduced the following bill; which was referred to the Committee on

Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to affirm

the confidentiality of closing and similar agreements and

agreements with foreign governments.

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

3 SECTION 1. CONFIDENTIALITY OF CERTAIN DOCUMENTS

4 RELATING TO CLOSING AND SIMILAR AGREE5 MENTS AND TO AGREEMENTS WITH FOREIGN

6 GOVERNMENTS.

7 (a) CLOSING AND SIMILAR AGREEMENTS TREATED

8 AS RETURN INFORMATION.—Paragraph (2) of section

9 6103(b) of the Internal Revenue Code of 1986 (defining
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1 return information) is amended by striking ‘‘and’’ at the

2 end of subparagraph (B), by inserting ‘‘and’’ at the end

3 of subparagraph (C), and by inserting after subparagraph

4 (C) the following new subparagraph:

5 ‘‘(D) any agreement under section 7121,

6 and any similar agreement, and any back7 ground information related to such an agree8 ment or request for such an agreement,’’.

9 (b) AGREEMENTS WITH FOREIGN GOVERNMENTS.—

10 (1) IN GENERAL.—Subchapter B of chapter 61

11 of such Code (relating to miscellaneous provisions) is

12 amended by inserting after section 6104 the fol13 lowing new section:

14 ‘‘SEC. 6105. CONFIDENTIALITY OF INFORMATION ARISING

15 UNDER TREATY OBLIGATIONS.

16 ‘‘(a) IN GENERAL.—Tax convention information shall

17 not be disclosed.

18 ‘‘(b) EXCEPTIONS.—Subsection (a) shall not apply—

19 ‘‘(1) to the disclosure of tax convention infor20 mation to persons or authorities (including courts

21 and administrative bodies) which are entitled to such

22 disclosure pursuant to a tax convention,

23 ‘‘(2) to any generally applicable procedural

24 rules regarding applications for relief under a tax

25 convention, or
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1 ‘‘(3) in any case not described in paragraphs

2 (1) or (2), to the disclosure of any tax convention

3 information not relating to a particular taxpayer if

4 the Secretary determines, after consultation with

5 each other party to the tax convention, that such

6 disclosure would not impair tax administration.

7 ‘‘(c) DEFINITIONS.—For purposes of this section—

8 ‘‘(1) TAX CONVENTION INFORMATION.—The

9 term ‘tax convention information’ means any—

10 ‘‘(A) agreement entered into with the com11 petent authority of one or more foreign govern12 ments pursuant to a tax convention,

13 ‘‘(B) application for relief under a tax con14 vention,

15 ‘‘(C) any background information related

16 to such agreement or application,

17 ‘‘(D) document implementing such agree18 ment, and

19 ‘‘(E) any other information exchanged pur20 suant to a tax convention which is treated as

21 confidential or secret under the tax convention.

22 ‘‘(2) TAX CONVENTION.—The term ‘tax conven23 tion’ means—

24 ‘‘(A) any income tax or gift and estate tax

25 convention, or
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1 ‘‘(B) any other convention or bilateral

2 agreement (including multilateral conventions

3 and agreements and any agreement with a pos4 session of the United States) providing for the

5 avoidance of double taxation, the prevention of

6 fiscal evasion, nondiscrimination with respect to

7 taxes, the exchange of tax relevant information

8 with the United States, or mutual assistance in

9 tax matters.

10 ‘‘(d) CROSS REFERENCES.—

‘‘For penalties for the unauthorized disclosure of

tax convention information which is return or return information, see sections 7213, 7213A, and

7431.’’.

11 (2) CLERICAL AMENDMENT.—The table of sec12 tions for subchapter B of chapter 61 of such Code

13 is amended by inserting after the item relating to

14 section 6104 the following new item:

‘‘Sec. 6105. Confidentiality of information arising under treaty

obligations.’’.

15 (c) EXCEPTION FROM PUBLIC INSPECTION AS WRIT16 TEN DETERMINATION.—

17 (1) CLOSING AND SIMILAR AGREEMENTS.—

18 Paragraph (1) of section 6110(b) of such Code is

19 amended to read as follows:

20 ‘‘(1) WRITTEN DETERMINATION.—

21 ‘‘(A) IN GENERAL.—The term ‘written de22 termination’ means a ruling, determination let-
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1 ter, technical advice memorandum, or Chief

2 Counsel advice.

3 ‘‘(B) EXCEPTIONS.—Such term shall not

4 include any matter referred to in subparagraph

5 (C) or (D) of section 6103(b)(2).’’.

6 (2) AGREEMENTS WITH FOREIGN GOVERN7 MENTS.—Paragraph (1) of section 6110(l) of such

8 Code is amended by inserting ‘‘or 6105’’ after

9 ‘‘6104’’.

10 (d) EFFECTIVE DATE.—The amendments made by

11 this section shall take effect on the date of the enactment

12 of this Act.

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