II 

117TH CONGRESS 

1ST SESSION S. 2782 

To address recommendations made to Congress by the Government Accountability Office and detailed in the annual duplication report, and for 

other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 21, 2021 

Ms. HASSAN (for herself and Mr. PAUL) introduced the following bill; which 

was read twice and referred to the Committee on Homeland Security and 

Governmental Affairs 

A BILL 

To address recommendations made to Congress by the Government Accountability Office and detailed in the annual 

duplication report, 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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Acting on the Annual Duplication Report Act of 2021’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Findings; sense of Congress. 


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TITLE I—DEPARTMENT OF DEFENSE 

Sec. 101. Enhancing Federal revenue through reviewing and reporting on use 

and management of administrative surcharges under foreign 

military sales program. 

Sec. 102. Modification of calculation of military housing contractor pay for 

privatized military housing. 

TITLE II—DEPARTMENT OF EDUCATION 

Sec. 201. Maximizing effective use and recoupment of Federal student loans by 

closing the forbearance loophole and amending default rates. 

TITLE III—DEPARTMENT OF ENERGY 

Sec. 301. Increasing Federal revenue by reviewing and reporting on optimal 

size of Strategic Petroleum Reserve. 

TITLE IV—DEPARTMENT OF HOUSING AND URBAN 

DEVELOPMENT 

Sec. 401. Optimizing revenue intake and saving taxpayer dollars at Ginnie Mae 

by assessing current practices and exploring alternative governance structures to provide better oversight. 

TITLE V—DEPARTMENT OF THE TREASURY 

Sec. 501. Saving Federal funds by authorizing changes to the composition of 

circulating coins. 

Sec. 502. Reducing the resource drain by requiring that electronically prepared 

paper returns include scannable code. 

Sec. 503. Protecting the security of taxpayer information held by third-party 

providers by improving coordination and establishing minimum 

security requirements to reduce fragmentation. 

1 SEC. 2. FINDINGS; SENSE OF CONGRESS. 

2 (a) FINDINGS.—Congress makes the following find3 ings: 

4 (1) The annual reports prepared by the Comp5 troller General of the United States under section 21 

6 of the Joint Resolution entitled ‘‘Joint Resolution 

7 increasing the statutory limit on the public debt’’, 

8 approved February 12, 2010 (31 U.S.C. 712 note; 

9 Public Law 111–139), have produced approximately 


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1 $429,000,000,000 in financial benefits for the Fed2 eral Government. 

3 (2) 2021 marks the 100-year anniversary of the 

4 creation of the Government Accountability Office 

5 and its contributions to improving the management 

6 and fiscal responsibility of the Federal Government. 

7 (3) The 2021 report entitled ‘‘Additional Op8 portunities to Reduce Fragmentation, Overlap, and 

9 Duplication and Achieve Billions in Financial Bene10 fits’’ (GAO–21–455SP) identified 112 new actions 

11 that Congress or the executive branch can take to 

12 improve efficiency and effectiveness across the Fed13 eral Government, and potentially to save tens of bil14 lions of dollars. 

15 (4) Those financial benefits cannot be realized 

16 without full implementation of the actions and rec17 ommendations set forth by the Comptroller General 

18 of the United States. 

19 (5) Of the 112 new actions, one requires legis20 lation to be fully implemented, and it concerns ad21 justing the rate calculation for paying military hous22 ing contractors. 

23 (b) SENSE OF CONGRESS.—It is the sense of Con24 gress that— 


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1 (1) it is the responsibility of Congress and the 

2 executive branch to take action to implement rec3 ommendations made in the annual reports of the 

4 Government Accountability Office on reducing dupli5 cation in Federal programs to be good stewards of 

6 taxpayer dollars; 

7 (2) legislation and adequate resources are need8 ed to ensure that all potential financial benefits are 

9 realized from the implementation of those rec10 ommendations; and 

11 (3) while some recommendations for congres12 sional action from previous reports have been re13 solved, Congress must continue to pursue the rec14 ommendations that have gone unaddressed in addi15 tion to the new recommendation for action presented 

16 in the 2021 report. 

17 TITLE I—DEPARTMENT OF 

18 DEFENSE 

19 SEC. 101. ENHANCING FEDERAL REVENUE THROUGH RE20 VIEWING AND REPORTING ON USE AND MAN21 AGEMENT OF ADMINISTRATIVE SURCHARGES 

22 UNDER FOREIGN MILITARY SALES PROGRAM. 

23 (a) FOREIGN MILITARY SALES PROGRAM DE24 FINED.—In this section, the term ‘‘foreign military sales 

25 program’’ means the program authorized under chapter 


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1 2 of the Arms Export Control Act (22 U.S.C. 2761 et 

2 seq.). 

3 (b) REVIEW.— 

4 (1) IN GENERAL.—The Secretary of Defense, 

5 acting through the Director of the Defense Security 

6 Cooperation Agency, shall review options for expand7 ing the use of administrative surcharges under the 

8 foreign military sales program, including practices 

9 for managing administrative surcharges and con10 tract administration services surcharges. 

11 (2) MATTERS TO BE INCLUDED.—The review 

12 conducted under paragraph (1) shall include the fol13 lowing: 

14 (A) A determination of which specific ex15 penses are incurred by the United States Gov16 ernment in operation of the foreign military 

17 sales program that the administrative surcharge 

18 does not pay for as of the date of the enact19 ment of this Act. 

20 (B) The estimated annual cost of each of 

21 such specific expenses. 

22 (C) An assessment of the costs and bene23 fits of funding such specific expenses through 

24 the administrative surcharge, including any 

25 data to support such an assessment. 


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1 (D) An assessment of how the Department 

2 of Defense calculates the lower bound, or safety 

3 level, for the administrative surcharge account 

4 and the contract administration services sur5 charge account, including what specific factors 

6 inform the calculation and whether such a 

7 method for calculating the safety level is still 

8 valid or should be revisited. 

9 (E) An assessment of the process used by 

10 the Department of Defense to review and set 

11 rates for the administrative surcharge and the 

12 contract administration services surcharge, in13 cluding the extent to which outside parties are 

14 consulted and any proposals the Department of 

15 Defense may have for better ensuring that the 

16 rates are set appropriately. 

17 (F) Such other matters as the Secretary of 

18 Defense determines to be appropriate. 

19 (c) REPORT REQUIRED.—Not later than 180 days 

20 after the date of the enactment of this Act, the Secretary 

21 of Defense, acting through the Director of the Defense 

22 Security Cooperation Agency, shall submit to the Com23 mittee on Armed Services of the Senate and the Com24 mittee on Armed Services of the House of Representatives 

25 a report on— 


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1 (1) the findings of the review conducted under 

2 subsection (b); and 

3 (2) any legislative changes needed to allow the 

4 administrative surcharge under the foreign military 

5 sales program to pay for any expenses currently not 

6 covered by that surcharge. 

7 SEC. 102. MODIFICATION OF CALCULATION OF MILITARY 

8 HOUSING CONTRACTOR PAY FOR PRIVA9 TIZED MILITARY HOUSING. 

10 Section 606(a) of the John S. McCain National De11 fense Authorization Act for Fiscal Year 2019 (Public Law 

12 115–232; 10 U.S.C. 2871 note) is amended— 

13 (1) in paragraph (1)(B)— 

14 (A) by striking ‘‘2.5 percent’’ and inserting 

15 ‘‘50 percent’’; and 

16 (B) by striking ‘‘section 403(b)(3)(A)(i)’’ 

17 and inserting ‘‘section 403(b)(3)(A)(ii)’’; and 

18 (2) in paragraph (2)(B)— 

19 (A) by striking ‘‘2.5 percent’’ and inserting 

20 ‘‘50 percent’’; and 

21 (B) by striking ‘‘section 403(b)(3)(A)(i)’’ 

22 and inserting ‘‘section 403(b)(3)(A)(ii)’’. 


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1 TITLE II—DEPARTMENT OF 

2 EDUCATION 

3 SEC. 201. MAXIMIZING EFFECTIVE USE AND RECOUPMENT 

4 OF FEDERAL STUDENT LOANS BY CLOSING 

5 THE FORBEARANCE LOOPHOLE AND AMEND6 ING DEFAULT RATES. 

7 (a) DEFAULT MANAGEMENT PLAN.—Section 

8 435(a)(7)(A) of the Higher Education Act of 1965 (20 

9 U.S.C. 1085(a)(7)(A)) is amended— 

10 (1) by redesignating clause (ii) as clause (iii); 

11 and 

12 (2) by inserting after clause (i) the following: 

13 ‘‘(ii) PROHIBITION.—The plan re14 quired under clause (i) shall not include 

15 placing students in forbearance as a means 

16 of reducing the cohort default rate of the 

17 institution.’’. 

18 (b) FORBEARANCE RULES.—Section 435(m)(1) of 

19 the Higher Education Act of 1965 (20 U.S.C. 

20 1085(m)(1)) is amended by adding at the end the fol21 lowing: 

22 ‘‘(D) With respect to a cohort default rate cal23 culated for an institution under this paragraph for 

24 fiscal year 2021 and for each succeeding fiscal year, 

25 the cohort default rate shall be calculated such that 


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1 in determining the number of current and former 

2 students at an institution who enter repayment for 

3 such fiscal year— 

4 ‘‘(i) any student who is in nonmandatory 

5 forbearance for such fiscal year for a period of 

6 greater than 18 months but less than 36 

7 months shall not be counted as entering repay8 ment for that fiscal year; 

9 ‘‘(ii) any student described in clause (i) 

10 shall be counted as entering repayment for the 

11 first fiscal year for which the student ceases to 

12 be in a period of forbearance and otherwise 

13 meets the requirements for being in repayment; 

14 and 

15 ‘‘(iii) any student who is in a period of 

16 nonmandatory forbearance for 3 or more years 

17 shall be counted as in default and included in 

18 the institution’s total number of students in de19 fault.’’. 

20 TITLE III—DEPARTMENT OF 

21 ENERGY 

22 SEC. 301. INCREASING FEDERAL REVENUE BY REVIEWING 

23 AND REPORTING ON OPTIMAL SIZE OF STRA24 TEGIC PETROLEUM RESERVE. 

25 (a) REVIEW.— 


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1 (1) IN GENERAL.—The Secretary of Energy 

2 (referred to in this section as the ‘‘Secretary’’) shall 

3 conduct a review of options for a long-range target 

4 for the optimal size and configuration of the Stra5 tegic Petroleum Reserve established under part B of 

6 title I of the Energy Policy and Conservation Act 

7 (42 U.S.C. 6231 et seq.) (referred to in this section 

8 as the ‘‘Reserve’’). 

9 (2) MATTERS TO BE CONSIDERED.—In con10 ducting the review under paragraph (1), the Sec11 retary shall consider— 

12 (A) the volume of petroleum and petroleum 

13 products to be held in the Reserve; 

14 (B) the infrastructure and modernization 

15 needs of the Reserve; 

16 (C) the projections for future oil produc17 tion and consumption in the United States; 

18 (D) the efficacy of the existing Reserve to 

19 respond to domestic supply disruptions; 

20 (E) the obligations of the International 

21 Energy Agency; 

22 (F) the expected responses of the private 

23 sector to any supply disruptions due to a sub24 optimal size and configuration of the Reserve; 

25 and 


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1 (G) the costs and benefits of a range of po2 tential sizes and configurations of the Reserve. 

3 (b) REPORT.—Not later than 180 days after the date 

4 of enactment of this Act, the Secretary shall submit to 

5 the Committee on Energy and Natural Resources of the 

6 Senate and the Committee on Energy and Commerce of 

7 the House of Representatives a report describing— 

8 (1) the findings of the review conducted under 

9 subsection (a); and 

10 (2) recommendations for legislation needed to 

11 optimize the size and configuration of the Reserve. 

12 TITLE IV—DEPARTMENT OF 

13 HOUSING AND URBAN DEVEL14 OPMENT 

15 SEC. 401. OPTIMIZING REVENUE INTAKE AND SAVING TAX16 PAYER DOLLARS AT GINNIE MAE BY ASSESS17 ING CURRENT PRACTICES AND EXPLORING 

18 ALTERNATIVE GOVERNANCE STRUCTURES 

19 TO PROVIDE BETTER OVERSIGHT. 

20 (a) DEFINITIONS.—In this section— 

21 (1) the term ‘‘appropriate congressional com22 mittees’’ means— 

23 (A) the Committee on Banking, Housing, 

24 and Urban Affairs of the Senate; 


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1 (B) the Committee on Homeland Security 

2 and Governmental Affairs of the Senate; 

3 (C) the Committee on Financial Services of 

4 the House of Representatives; and 

5 (D) the Committee on Oversight and Re6 form of the House of Representatives; 

7 (2) the term ‘‘Association’’ means the Govern8 ment National Mortgage Association; and 

9 (3) the term ‘‘Secretary’’ means the Secretary 

10 of Housing and Urban Development. 

11 (b) GUARANTY FEE STUDY AND REPORT.—Not later 

12 than 1 year after the date of enactment of this Act, the 

13 Secretary shall conduct a study and submit to the appro14 priate congressional committees and the Comptroller Gen15 eral of the United States a report on the adequacy of the 

16 guaranty fee of the Association for single-family mort17 gage-backed securities, which shall— 

18 (1) evaluate the extent to which the level of the 

19 guaranty fee for single-family mortgage-backed secu20 rities provides the Association with sufficient re21 serves to cover potential losses under different eco22 nomic scenarios, including adverse scenarios, based 

23 on an actuarial or similar analysis; 

24 (2) identify the types of standards that the As25 sociation could use to set the guaranty fee for singleVerDate Sep 11 2014 16:39 Sep 23, 2021 Jkt 019200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S2782.IS S2782

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1 family mortgage-backed securities and evaluate 

2 which standard or standards would enable the Asso3 ciation to set the guaranty fee at an appropriate 

4 level in line with the mission of the Association; 

5 (3) assess the benefits and costs of adopting a 

6 risk-based guaranty fee for single-family mortgage7 backed securities that imposes a higher fee on higher 

8 risk issuers; 

9 (4) analyze how and to what extent an increase 

10 in the guaranty fee (for all issuers and a subset of 

11 riskier issuers) would affect borrowers’ financing, 

12 closing, and other related costs for federally insured 

13 mortgage loans; and 

14 (5) if warranted, include recommendations for 

15 any necessary amendments to the National Housing 

16 Act (12 U.S.C. 1701 et seq.) to change the guaranty 

17 fee for single-family mortgage-backed securities, in18 cluding for establishing a standard under which the 

19 Association can determine the level of the guaranty 

20 fee for single-family mortgage-backed securities. 

21 (c) RELIANCE ON CONTRACTORS STUDY AND RE22 PORT.—Not later than 1 year after the date of enactment 

23 of this Act, the Secretary shall conduct a study and submit 

24 to the appropriate congressional committees and the 

25 Comptroller General of the United States a report evaluVerDate Sep 11 2014 16:39 Sep 23, 2021 Jkt 019200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S2782.IS S2782

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1 ating the workforce composition of the Association in con2 sideration of the critical functions of the Association, 

3 which shall— 

4 (1) analyze— 

5 (A) the number of Federal employees and 

6 contractors by type of role or position that the 

7 Association uses to perform compliance, risk 

8 management, and other critical functions, and 

9 the cost of a full-time equivalent Federal em10 ployee versus a contractor for comparable roles 

11 or positions; 

12 (B) the extent to which the Association 

13 could use Federal employees instead of contrac14 tors by role or position to perform critical func15 tions; 

16 (C) the types and amounts of costs that 

17 the Association could save by using Federal em18 ployees instead of contractors, where possible, 

19 to perform critical functions, such as savings 

20 from differences in pay and not having to over21 see contractors; 

22 (D) whether the Association would face 

23 any legal or other obstacles in using Federal 

24 employees instead of contractors to perform 

25 critical functions; and 


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1 (E) the potential negative and positive ef2 fects of using Federal employees instead of con3 tractors on the ability of the Association to 

4 achieve the mission of the Association; and 

5 (2) if warranted, include recommendations for 

6 any necessary amendments to the National Housing 

7 Act (12 U.S.C. 1701 et seq.) to change the funding 

8 structure of the Association. 

9 (d) COMPENSATION STRUCTURE STUDY AND RE10 PORT.—Not later than 1 year after the date of enactment 

11 of this Act, the Secretary shall conduct a study and submit 

12 to the appropriate congressional committees and the 

13 Comptroller General of the United States a report evalu14 ating the workforce challenges of the Association, which 

15 shall— 

16 (1) analyze, quantitatively to the extent pos17 sible, the challenges of the Association in hiring and 

18 retaining staff, including compensation, during the 

19 3-year period preceding the report; 

20 (2) identify and summarize the options that the 

21 Association has pursued within existing authorities 

22 to address the staffing challenges of the Association, 

23 including which agencies or offices were involved, 

24 and the key decisions and outcomes of those efforts; 


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1 (3) identify options that the Association did not 

2 pursue within existing authorities to address the 

3 staffing challenges of the Association and the rea4 sons for not pursuing those options; 

5 (4) identify and evaluate options outside of ex6 isting authorities that the Association could use to 

7 address the staffing challenges of the Association 

8 and the potential benefits and costs of those options; 

9 and 

10 (5) if warranted, include recommendations for 

11 any necessary amendments to the National Housing 

12 Act (12 U.S.C. 1701 et seq.) to change how the 

13 Government National Mortgage Association sets 

14 compensation. 

15 (e) REVIEW OF REFORMS TO GINNIE MAE’S ORGANI16 ZATIONAL AND OVERSIGHT STRUCTURE.—The Comp17 troller General of the United States shall conduct a study 

18 and submit to the appropriate congressional committees 

19 a report on alternate ways of overseeing the Association 

20 to address increasing risks, which shall— 

21 (1) review the reports submitted by the Sec22 retary under subsections (b), (c), and (d) to deter23 mine if the reports addressed the required provisions 

24 and assess any recommendations made in those re25 ports; 


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1 (2) identify key challenges or constraints that 

2 the Association has faced under the governance and 

3 funding structure of the Association as a govern4 ment corporation within the Department of Housing 

5 and Urban Development; 

6 (3) identify alternative models under which the 

7 governance and funding structure of the Association 

8 could be reorganized to better support housing policy 

9 priorities in the United States and to ensure that 

10 the Association fulfilling the role of increasing li11 quidity in the housing finance market while also 

12 minimizing risk to the taxpayer; 

13 (4) evaluate the potential positive and negative 

14 impacts of the models described in paragraph (3) on 

15 the Association, the Department of Housing and 

16 Urban Development, and other stakeholders; 

17 (5) obtain input from relevant stakeholders, 

18 such as Federal entities, lenders, issuers, investors, 

19 affordable housing advocates, and researchers, on re20 forms to the organizational and oversight structure 

21 of the Association; 

22 (6) consider the housing finance system and 

23 ways in which alternative oversight structures of the 

24 Association could impact the system; and 


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1 (7) review such other information as the Comp2 troller General determines relevant. 

3 TITLE V—DEPARTMENT OF THE 

4 TREASURY 

5 SEC. 501. SAVING FEDERAL FUNDS BY AUTHORIZING 

6 CHANGES TO THE COMPOSITION OF CIRCU7 LATING COINS. 

8 (a) Section 5112 of title 31, United States Code, is 

9 amended by adding at the end the following: 

10 ‘‘(bb) COMPOSITION OF CIRCULATING COINS.— 

11 ‘‘(1) IN GENERAL.—Notwithstanding any other 

12 provision of law, and subject to the other provisions 

13 of this subsection, the Director of the United States 

14 Mint (referred to in this subsection as the ‘Direc15 tor’), in consultation with the Secretary, may modify 

16 the metallic composition of circulating coins to a new 

17 metallic composition (including by prescribing rea18 sonable manufacturing tolerances with respect to 

19 those coins) if a study and analysis conducted by the 

20 United States Mint, including solicitation of input, 

21 including input on acceptor tolerances and require22 ments, from industry stakeholders who could be af23 fected by changes in the composition of circulating 

24 coins, indicates that the modification will— 


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1 ‘‘(A) reduce costs incurred by the tax2 payers of the United States; 

3 ‘‘(B) be seamless, which shall mean the 

4 same diameter and weight as United States 

5 coinage being minted on the date of enactment 

6 of this subsection and that the coins will work 

7 interchangeably in most coin acceptors using 

8 electromagnetic signature technology; and 

9 ‘‘(C) have as minimal an adverse impact as 

10 possible on the public and stakeholders. 

11 ‘‘(2) NOTIFICATION TO CONGRESS.—On the 

12 date that is at least 90 legislative days before the 

13 date on which the Director begins making a modi14 fication described in paragraph (1), the Director 

15 shall submit to Congress notice that— 

16 ‘‘(A) provides a justification for the modi17 fication, including the support for that modi18 fication in the study and analysis required 

19 under paragraph (1) with respect to the modi20 fication; 

21 ‘‘(B) describes how the modification will 

22 reduce costs incurred by the taxpayers of the 

23 United States; 

24 ‘‘(C) certifies that the modification will be 

25 seamless, as described in paragraph (1)(B); and 


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1 ‘‘(D) certifies that the modification will 

2 have as minimal an adverse impact as possible 

3 on the public and stakeholders. 

4 ‘‘(3) CONGRESSIONAL AUTHORITY.—The Direc5 tor may begin making a modification proposed under 

6 this subsection not earlier than the date that is 90 

7 legislative days after the date on which the Director 

8 submits to Congress the notice required under para9 graph (2) with respect to that modification, unless 

10 Congress, during the period of 90 legislative days 

11 beginning on the date on which the Director submits 

12 that notice— 

13 ‘‘(A) finds that the modification is not jus14 tified in light of the information contained in 

15 that notice; and 

16 ‘‘(B) enacts a joint resolution of dis17 approval of the proposed modification. 

18 ‘‘(4) PROCEDURES.—For purpose of paragraph 

19 (3)— 

20 ‘‘(A) a joint resolution of disapproval is a 

21 joint resolution the matter after the resolving 

22 clause of which is as follows: ‘That Congress 

23 disapproves the modification submitted by the 

24 Director of the United States Mint.’; and 


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1 ‘‘(B) the procedural rules in the House of 

2 Representatives and the Senate for a joint reso3 lution of disapproval described under paragraph 

4 (3) shall be the same as provided for a joint 

5 resolution of disapproval under chapter 8 of 

6 title 5, United States Code.’’. 

7 (b) DETERMINATION OF BUDGETARY EFFECTS.— 

8 The budgetary effects of this Act, for the purpose of com9 plying with the Statutory Pay-As-You-Go-Act of 2010, 

10 shall be determined by reference to the latest statement 

11 titled ‘‘Budgetary Effects of PAYGO Legislation’’ for this 

12 Act, submitted for printing in the Congressional Record 

13 by the Chairman of the Senate Budget Committee, pro14 vided that such statement has been submitted prior to the 

15 vote on passage. 

16 SEC. 502. REDUCING THE RESOURCE DRAIN BY REQUIRING 

17 THAT ELECTRONICALLY PREPARED PAPER 

18 RETURNS INCLUDE SCANNABLE CODE. 

19 (a) IN GENERAL.—Subsection (e) of section 6011 of 

20 the Internal Revenue Code of 1986 is amended by adding 

21 at the end the following new paragraph: 

22 ‘‘(8) SPECIAL RULE FOR RETURNS PREPARED

23 ELECTRONICALLY AND SUBMITTED ON PAPER.—The 

24 Secretary shall require that any return of tax which 

25 is prepared electronically, but is printed and filed on 


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1 paper, bear a code which can, when scanned, convert 

2 such return to electronic format.’’. 

3 (b) CONFORMING AMENDMENT.—Paragraph (1) of 

4 section 6011(e) of such Code is amended by striking 

5 ‘‘paragraph (3)’’ and inserting ‘‘paragraphs (3) and (8)’’. 

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

7 this section shall apply to returns of tax the due date for 

8 which (determined without regard to extensions) is after 

9 December 31, 2021. 

10 SEC. 503. PROTECTING THE SECURITY OF TAXPAYER IN11 FORMATION HELD BY THIRD-PARTY PRO12 VIDERS BY IMPROVING COORDINATION AND 

13 ESTABLISHING MINIMUM SECURITY RE14 QUIREMENTS TO REDUCE FRAGMENTATION. 

15 (a) REGULATION OF SECURITY REQUIREMENTS FOR

16 TAX RETURN PREPARERS AND AUTHORIZED E-FILE

17 PROVIDERS.— 

18 (1) IN GENERAL.—Not later than 180 days 

19 after the date of the enactment of this Act, the Sec20 retary of the Treasury (or the Secretary’s delegate) 

21 shall prescribe standards for the security of return 

22 information and information technology systems that 

23 are consistent with security standards issued by the 

24 National Institute for Standards and Technology. 


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1 (2) PENALTY FOR FAILURE TO SECURE INFOR2 MATION.— 

3 (A) IN GENERAL.—Section 6695 of the In4 ternal Revenue Code of 1986 is amended by re5 designating subsection (h) as subsection (i) and 

6 by inserting after subsection (g) the following 

7 new subsection: 

8 ‘‘(h) FAILURE TO COMPLY WITH ELECTRONIC RE9 TURN SECURITY STANDARDS.—Any person who is author10 ized by the Secretary to provide electronic filing services 

11 and who fails to secure return information and informa12 tion technology standards in such manner as prescribed 

13 by the Secretary shall pay a penalty of $500 for each such 

14 failure. The maximum penalty imposed under this sub15 section on any person with respect to any calendar year 

16 shall not exceed $25,000.’’. 

17 (B) INFLATION ADJUSTMENT.—Section 

18 6695(i) of such Code, as redesignated by sub19 paragraph (A), is amended— 

20 (i) by redesignating paragraph (2) as 

21 paragraph (3); 

22 (ii) by inserting after paragraph (1) 

23 the following new paragraph: 

24 ‘‘(2) FAILURE TO COMPLY WITH SECURITY

25 STANDARDS.—In the case of any failure described in 


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1 subsection (h) in a calendar year beginning after 

2 2022, each of the dollar amounts under subsection 

3 (h) shall be increased by an amount equal to such 

4 dollar amount multiplied by the cost-of-living adjust5 ment determined under section 1(f)(3) for the cal6 endar year determined by substituting ‘calendar year 

7 2021’ for ‘calendar year 2016’ in subparagraph 

8 (A)(ii) thereof.’’; and 

9 (iii) in paragraph (3) (as redesignated 

10 by clause (i)), by striking ‘‘paragraph (1)’’ 

11 and inserting ‘‘paragraph (1) or (2)’’. 

12 (C) EFFECTIVE DATE.—The amendments 

13 made by this paragraph shall apply to failures 

14 described in section 6695(h) of the Internal 

15 Revenue Code of 1986 (as added by subpara16 graph (A)) after the date that is 60 days after 

17 the date the Secretary prescribes the standards 

18 required under paragraph (1). 

19 (b) COORDINATION OF TAXPAYER INFORMATION SE20 CURITY.—Not later than 180 days after the date of enact21 ment of this Act, the Commissioner of Internal Revenue 

22 shall develop an organizational plan to create a centralized 

23 body or other governance structure to coordinate all as24 pects of the Internal Revenue Service’s efforts to protect 

25 return information while being held or transmitted by 


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1 those authorized by the Internal Revenue Service to pro2 vide electronic filing services. The Commissioner shall 

3 transmit the organizational plan to the Committee on Fi4 nance of the Senate, the Committee on Homeland Security 

5 and Governmental Affairs of the Senate, the Committee 

6 on Ways and Means of the House of Representatives, and 

7 the Committee on Oversight and Reform of the House of 

8 Representatives. 

Æ 


pamtmann on DSKBC07HB2PROD with BILLS