I 

109TH CONGRESS 

1ST SESSION H. R. 1234 

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. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 10, 2005 

Mr. DOGGETT (for himself, Mr. STARK, Mr. MCDERMOTT, Mr. LEWIS of 

Georgia, Mr. EMANUEL, Mr. ALLEN, Ms. BALDWIN, Ms. BERKLEY, Ms. 

BORDALLO, Mr. BROWN of Ohio, Ms. CARSON, Mr. DAVIS of Illinois, Ms. 

DELAURO, Mr. FATTAH, Mr. FILNER, Mr. GENE GREEN of Texas, Mr. 

GRIJALVA, Mr. KUCINICH, Ms. LEE, Mrs. MALONEY, Ms. NORTON, Mr. 

OWENS, Mr. RYAN of Ohio, Mr. SANDERS, Ms. SLAUGHTER, Ms. SOLIS, 

Mr. TIERNEY, Mrs. JONES of Ohio, Mr. WAXMAN, and Ms. WOOLSEY) 

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 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. 
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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 ‘‘Corporate Account5 ability Tax Gap Act of 2005’’. 

6 SEC. 2. AVAILABILITY OF CERTAIN TAX INFORMATION OF 

7 PUBLICLY TRADED CORPORATIONS. 

8 (a) IN GENERAL.—Section 6103 of the Internal Rev9 enue Code of 1986 is amended by redesignating subsection 

10 (q) as subsection (r) and by inserting after subsection (p) 

11 the following new subsection: 

12 ‘‘(q) PUBLIC DISCLOSURE OF CERTAIN CORPORATE

13 TAX INFORMATION.— 

14 ‘‘(1) IN GENERAL.—Each specified corporation 

15 shall, on the date that it files its return of tax im16 posed by chapter 1 for each taxable year, electroni17 cally file the information described in paragraph (2) 

18 for such year. Not later than 30 days after receiving 

19 such information, the Secretary shall make it elec20 tronically available to the public as a single docu21 ment and as part of a searchable database as pro22 vided in paragraph (3). 

23 ‘‘(2) INFORMATION.—The information de24 scribed in this paragraph with respect to a corpora25 tion for a taxable year are the following items: 
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1 ‘‘(A) Net corporate income tax as shown 

2 on the return for such year. 

3 ‘‘(B) Amount shown as Federal income tax 

4 expense on its annual statement (if any) filed 

5 with the Securities and Exchange Commission. 

6 ‘‘(C) Taxable income as shown on such re7 turn. 

8 ‘‘(D) Adjusted book income. 

9 ‘‘(E) The portion of the total difference be10 tween taxable income and adjusted book income 

11 which is attributable to each of the following: 

12 ‘‘(i) Transactions disclosable under 

13 section 6011. 

14 ‘‘(ii) Depreciation differences. 

15 ‘‘(iii) Stock options. 

16 ‘‘(iv) Income from entities consoli17 dated for book income purposes but not for 

18 Federal income tax purposes. 

19 ‘‘(v) Income from pension funds or 

20 tax-exempt bonds. 

21 ‘‘(vi) Other items, pursuant to regula22 tions prescribed by the Secretary. 

23 ‘‘(F) An explanation of the differences be24 tween taxable income and adjusted book income 
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1 that are attributable to one or more of the fol2 lowing: 

3 ‘‘(i) Transactions referred to in sub4 paragraph (E)(i). 

5 ‘‘(ii) Other items specified in regula6 tions referred to in subparagraph (E)(vi). 

7 ‘‘(iii) Any additional information that 

8 the Secretary determines would be useful 

9 in enforcing this title, including any infor10 mation which is an indicia of abusive tax 

11 avoidance schemes. 

12 ‘‘(3) ACCESS.—The Secretary shall make the 

13 information described in paragraph (2) accessible 

14 electronically by a search which uses the following 

15 items: 

16 ‘‘(A) Name of the corporation. 

17 ‘‘(B) Headquarters location by postal zip 

18 code. 

19 ‘‘(C) Each category of such information. 

20 ‘‘(D) Taxable year or other time period to 

21 which such information relates. 

22 ‘‘(E) The CUSIP identification number 

23 under which the corporation files reports with 

24 the Securities and Exchange Commission. 
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1 ‘‘(4) SPECIFIED CORPORATION.—For purposes 

2 of this subsection, the term ‘specified corporation’ 

3 means— 

4 ‘‘(A) any corporation issuing any class of 

5 securities required to be registered under sec6 tion 12 of the Securities Exchange Act of 1934, 

7 and 

8 ‘‘(B) any other domestic corporation which 

9 is a member of an affiliated group (as defined 

10 in section 1504) which includes a corporation 

11 described in subparagraph (A). 

12 In the case of a corporation which is a member of 

13 an affiliated group filing a consolidated return, the 

14 term ‘specified corporation’ means such group and 

15 not each member thereof. 

16 ‘‘(5) OTHER DEFINITIONS.—For purposes of 

17 this subsection— 

18 ‘‘(A) NET CORPORATE INCOME TAX.—The 

19 term ‘net corporate income tax’ means the sum 

20 of regular tax liability (as defined by section 

21 26(b)) and the tax imposed by section 55, re22 duced by the credits allowable under part IV of 

23 subchapter A of chapter 1. 

24 ‘‘(B) ADJUSTED BOOK INCOME.—The term 

25 ‘adjusted book income’ means book income re-
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1 ported to the Securities and Exchange Commis2 sion (or to shareholders) without reduction for 

3 preferred stock dividends, Federal income taxes, 

4 and income, war profits, or excess profits taxes 

5 imposed by any foreign country or possession of 

6 the United States.’’. 

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

8 subsection (a) shall apply to taxable years ending after 

9 the date of the enactment of this Act. 

10 SEC. 3. STUDY OF TAX SHELTER ACTIVITY. 

11 (a) STUDY.—The Secretary of the Treasury (or the 

12 Secretary’s delegate) shall, in coordination with the Joint 

13 Committee on Taxation, Committee on Finance of the 

14 Senate, and the Committee on Ways and Means of the 

15 House of Representatives, conduct a study of recent 

16 known corporate tax shelter activity, including information 

17 gained from the tax shelter amnesty announced in Internal 

18 Revenue Service Announcement 2002–02 and from the 

19 study of Enron tax returns by the Committee on Finance 

20 of the Senate. 

21 (b) REPORT.—Not later than 1 year after the date 

22 of the enactment of this Act, the report of such study shall 

23 be submitted to the Committee on Finance of the Senate 

24 and the Committee on Ways and Means of the House of 
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1 Representatives. Such report shall include recommenda2 tions (if any) for—

3 (1) requiring additional information on the rec4 onciliation of book/tax accounting and publicly dis5 closing that additional information under section 

6 6103(q) of the Internal Revenue Code of 1986, and 

7 (2) publicly disclosing additional information 

8 from the corporate income tax return. 

9 Such report also shall include a description of the actions 

10 that such Secretary has taken toward implementing any 

11 such recommendations.

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