I 

115TH CONGRESS 

1ST SESSION H. R. 1996 

To amend the Internal Revenue Code of 1986 and the Consumer Financial 

Protection Act of 2010 to regulate tax return preparers and refund 

anticipation payment arrangements, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 6, 2017 

Ms. BONAMICI introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Financial Services, for a period to be subsequently determined by the Speaker, 

in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend the Internal Revenue Code of 1986 and the Consumer Financial Protection Act of 2010 to regulate tax 

return preparers and refund anticipation payment arrangements, and for other purposes. 

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 ‘‘Tax Refund Protection 

5 Act of 2017’’. 


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1 SEC. 2. REGULATION OF TAX RETURN PREPARERS. 

2 (a) IN GENERAL.—Subchapter A of chapter 80 of the 

3 Internal Revenue Code of 1986 is amended by adding at 

4 the end the following new section: 

5 ‘‘SEC. 7812. REGULATION OF TAX RETURN PREPARERS. 

6 ‘‘(a) IN GENERAL.—The Secretary shall— 

7 ‘‘(1) establish a program to license or certify 

8 tax return preparers subject to this section, 

9 ‘‘(2) regulate such tax return preparers, and 

10 ‘‘(3) before licensing or certifying a person as 

11 a tax return preparer subject to this section, require 

12 that the person demonstrate— 

13 ‘‘(A) good character, 

14 ‘‘(B) good reputation, 

15 ‘‘(C) necessary qualifications to enable the 

16 person to provide to persons valuable service as 

17 a tax return preparer, and 

18 ‘‘(D) competency to perform the functions 

19 of a tax return preparer. 

20 ‘‘(b) AUTHORITY TO IMPOSE A FEE.—The Secretary 

21 shall require tax return preparers subject to this section 

22 to pay a reasonable fee for licensing or certification under 

23 this section. 

24 ‘‘(c) DISCLOSURE REQUIREMENTS.—The Secretary 

25 shall, by rule, require tax return preparers subject to this 


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1 section to provide a disclosure statement to taxpayers that 

2 shall contain statements— 

3 ‘‘(1) identifying the amount of fees such tax re4 turn preparer charges for preparing a Federal in5 come tax return, filing a Federal income tax return, 

6 or executing a refund anticipation payment arrange7 ment, and 

8 ‘‘(2) identifying the average amount of time in 

9 which an individual who files a Federal income tax 

10 return electronically can expect to receive a refund 

11 by mail, according to information provided by the 

12 Internal Revenue Service. 

13 ‘‘(d) DISCIPLINARY PROCEDURES.—After notice and 

14 opportunity for a hearing, the Secretary may take any en15 forcement action against a tax return preparer subject to 

16 this section who— 

17 ‘‘(1) is incompetent, 

18 ‘‘(2) is disreputable, 

19 ‘‘(3) violates regulations prescribed under this 

20 section, or 

21 ‘‘(4) with intent to defraud, willfully and know22 ingly misleads or threatens a consumer. 

23 ‘‘(e) TAX RETURN PREPARER SUBJECT TO SEC24 TION.—A tax return preparer is subject to this section if 


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1 such preparer is not subject to section 330 of title 31, 

2 United States Code. 

3 ‘‘(f) DEFINITIONS.—For purposes of this section— 

4 ‘‘(1) TAX RETURN PREPARER.—See section 

5 7701(a)(36) for the definition of a tax return pre6 parer. 

7 ‘‘(2) REFUND ANTICIPATION PAYMENT AR8 RANGEMENT.—The term ‘refund anticipation pay9 ment arrangement’ has the meaning given such term 

10 by section 1029B(d)(2) of the Consumer Financial 

11 Protection Act of 2010.’’. 

12 (b) CLERICAL AMENDMENT.—The table of sections 

13 for subchapter A of chapter 80 of the Internal Revenue 

14 Code of 1986 is amended by inserting after the item re15 lated to section 7811 the following new item: 

‘‘Sec. 7812. Regulation of tax return preparers.’’. 

16 (c) EFFECTIVE DATE.—The amendments made by 

17 this section shall apply with respect to returns filed after 

18 December 31, 2017. 

19 SEC. 3. REGULATION OF REFUND ANTICIPATION PAYMENT 

20 INSTRUMENTS. 

21 (a) IN GENERAL.—Subtitle B of the Consumer Fi22 nancial Protection Act of 2010 (12 U.S.C. 5481 et seq.) 

23 is amended by adding at the end the following new section: 


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1 ‘‘SEC. 1029B. REGULATION OF REFUND ANTICIPATION PAY2 MENT ARRANGEMENTS. 

3 ‘‘(a) IN GENERAL.—The Bureau shall regulate re4 fund anticipation payment arrangements. 

5 ‘‘(b) DISCLOSURE REQUIREMENTS.—The Bureau 

6 shall, by rule, require tax return preparers subject to this 

7 section offering a refund anticipation payment agreement 

8 to provide a disclosure statement to a consumer that shall 

9 contain statements— 

10 ‘‘(1) identifying the amount of fees for exe11 cuting a refund anticipation payment arrangement; 

12 ‘‘(2) describing, in the case of a refund antici13 pation payment arrangement involving a depository 

14 account not controlled by the consumer, the dif15 ference in days between the average amount of time 

16 by which a consumer receives the tax refund (in 

17 whole or in part) from a refund anticipation pay18 ment arrangement and the average amount of time 

19 by which a consumer who files a Federal income tax 

20 return electronically receives the tax refund depos21 ited directly to that consumer’s deposit account by 

22 the taxing authority; 

23 ‘‘(3) that a refund anticipation payment ar24 rangement is not necessary to receive a tax refund; 

25 and 


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1 ‘‘(4) that, if a consumer does not receive a tax 

2 refund or the amount of the tax refund is less than 

3 the amount anticipated under the refund anticipa4 tion payment arrangement, the consumer may be re5 sponsible for paying any fees and interest associated 

6 with a refund anticipation payment arrangement. 

7 ‘‘(c) REQUIREMENTS UNDER TILA.—The Bureau 

8 shall issue regulations that, to the extent practicable, re9 quire tax return preparers that enter into a refund antici10 pation payment arrangement to comply with section 128 

11 of the Truth in Lending Act (15 U.S.C. 1638) to the same 

12 extent as a creditor making a consumer credit transaction 

13 other than under an open end credit plan. 

14 ‘‘(d) DEFINITIONS.—For purposes of this section, the 

15 following definitions shall apply: 

16 ‘‘(1) TAX RETURN PREPARER.—The term ‘tax 

17 return preparer subject to this section’ means a tax 

18 return preparer (as defined in section 7701(a)(36) 

19 of the Internal Revenue Code of 1986) who is not 

20 subject to regulation under section 330 of title 31, 

21 United States Code. 

22 ‘‘(2) REFUND ANTICIPATION PAYMENT AR23 RANGEMENT.—The term ‘refund anticipation pay24 ment arrangement’ means an arrangement under 

25 which, in exchange for Federal income tax preparaVerDate Sep 11 2014 04:23 Apr 13, 2017 Jkt 069200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1996.IH H1996

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1 tion services, a consumer agrees to pay a fee or in2 terest upon receipt of the consumer’s tax refund to 

3 a tax return preparer, lender, or other affiliated 

4 lender by— 

5 ‘‘(A) requesting the Federal Government 

6 to deposit such tax refund, in whole or in part, 

7 directly into a depository account designated by 

8 either the consumer or the tax return preparer, 

9 lender, or other affiliated lender; or 

10 ‘‘(B) directly paying the fee or interest to 

11 the tax return preparer, lender, or other affili12 ated lender.’’. 

13 (b) CLERICAL AMENDMENT.—The table of contents 

14 of the Dodd-Frank Wall Street Reform and Consumer 

15 Protection Act (12 U.S.C. 5301 et seq.) is amended by 

16 inserting after the item related to section 1029A the fol17 lowing new item: 

‘‘Sec. 1029B. Regulation of refund anticipation payment arrangement.’’. 

18 (c) EXCLUSION FOR CERTAIN TAX PREPARERS.— 

19 (1) IN GENERAL.—Section 1027(d)(1) of such 

20 Act is amended by striking subparagraph (B). 

21 (2) CONFORMING AMENDMENTS.—Section 

22 1027(d) of such Act is further amended— 

23 (A) in paragraph (1)— 

24 (i) in the heading, by striking ‘‘AND

25 TAX PREPARERS’’; 


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1 (ii) by striking ‘‘authority over’’ and 

2 all that follows through ‘‘any person that’’ 

3 and inserting ‘‘authority over any person 

4 that’’; 

5 (iii) by redesignating clauses (i) and 

6 (ii) as subparagraphs (A) and (B), respec7 tively, and by moving such subparagraphs 

8 2 ems to the left; 

9 (iv) by redesignating subclauses (I) 

10 and (II) as clauses (i) and (ii), respec11 tively, and by moving such clauses 2 ems 

12 to the left; 

13 (v) by striking ‘‘tax, advisory’’ and in14 serting ‘‘tax (except as related to tax re15 turn preparers pursuant to section 

16 1029B), advisory’’; and 

17 (vi) in clause (ii) (as redesignated), by 

18 striking ‘‘; or’’ and inserting a period; and 

19 (B) in paragraph (2)— 

20 (i) in subparagraph (A)— 

21 (I) by striking ‘‘paragraph (1)(A) 

22 or (1)(B)’’ and inserting ‘‘such para23 graph’’; and 


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1 (II) by striking ‘‘paragraph 

2 (1)(A)’’ each place it appears and in3 serting ‘‘paragraph (1)’’; 

4 (ii) in subparagraph (C)— 

5 (I) by striking ‘‘in paragraph 

6 (1)(A)’’ and inserting ‘‘in paragraph 

7 (1)’’; and 

8 (II) by striking ‘‘clause (i) or (ii) 

9 of paragraph (1)(A)’’ and inserting 

10 ‘‘subparagraph (A) or (B) of para11 graph (1)’’; and 

12 (iii) in subparagraph (D), by striking 

13 ‘‘paragraph (1)(A) or (1)(B)’’ and insert14 ing ‘‘such paragraph’’. 

15 SEC. 4. SPLIT REFUNDS MAY INCLUDE TAX RETURN PRE16 PARER. 

17 (a) IN GENERAL.—Section 6402 of the Internal Rev18 enue Code of 1986 is amended by adding at the end the 

19 following: 

20 ‘‘(n) SPLIT REFUNDS.—An income tax refund re21 quested on a return of Federal income tax prepared by 

22 an income tax preparer may be split between the preparer 

23 and the taxpayer in accordance with the split requested 

24 by the taxpayer on the return, except that the amount des25 ignated for the preparer may not exceed the amount preVerDate Sep 11 2014 04:23 Apr 13, 2017 Jkt 069200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H1996.IH H1996

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1 scribed by the Secretary by regulation or other guidance. 

2 A split of an individual income tax return under this sub3 section shall not be treated as disreputable conduct merely 

4 because the taxpayer requested such split.’’. 

5 (b) EFFECTIVE DATE.—The amendment made by 

6 subsection (a) shall apply with respect to returns for tax7 able years ending after the date of the enactment of this 

8 Act. 

9 SEC. 5. REGULATIONS. 

10 Regulations issued under section 7812 of the Internal 

11 Revenue Code of 1986, as added by section 2, and regula12 tions issued under section 1029B of the Consumer Finan13 cial Protection Act of 2010, as added by section 3, should 

14 be coordinated to the extent practicable. 

Æ 


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