IIB 

111TH CONGRESS 

2D SESSION H. R. 4994 

IN THE SENATE OF THE UNITED STATES 

APRIL 15, 2010 

Received; read twice and referred to the Committee on Finance 

AN ACT 

To amend the Internal Revenue Code of 1986 to reduce 

taxpayer burdens and enhance taxpayer protections, 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, 


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1 SECTION 1. SHORT TITLE, ETC. 

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

3 ‘‘Taxpayer Assistance Act of 2010’’. 

4 (b) AMENDMENT OF INTERNAL REVENUE CODE OF

5 1986.—Except as otherwise expressly provided, whenever 

6 in this Act an amendment or repeal is expressed in terms 

7 of an amendment to, or repeal of, a section or other provi8 sion, the reference shall be considered to be made to a 

9 section or other provision of the Internal Revenue Code 

10 of 1986. 

11 (c) TABLE OF CONTENTS.—The table of contents of 

12 this Act is as follows: 

Sec. 1. Short title, etc. 

TITLE I—CELL PHONES AND ELECTRONIC FILING 

Sec. 101. Removal of cellular telephones and similar telecommunications equipment from listed property. 

Sec. 102. Electronic filing exemption for religious reasons. 

Sec. 103. Accelerate interest on refunds for returns filed electronically. 

TITLE II—COLLECTION 

Sec. 201. Study on the effectiveness of collection alternatives. 

Sec. 202. Repeal of partial payment requirement on submissions of offers-incompromise. 

TITLE III—TAXPAYER ASSISTANCE AND PROTECTION 

IMPROVEMENTS 

Sec. 301. Referrals to Low-Income Taxpayer Clinics permitted. 

Sec. 302. Low-income taxpayer clinics. 

Sec. 303. EITC outreach. 

Sec. 304. Taxpayer notification of suspected identity theft. 

Sec. 305. Clarification of IRS unclaimed refund authority. 

Sec. 306. Study on delivery of tax refunds. 

Sec. 307. Study on timely processing and use of information returns. 

Sec. 308. Study on easing the burden of in-person tax payments. 

TITLE IV—REVENUE PROVISIONS 

Sec. 401. Expansion of bad check penalty to electronic payments. 


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Sec. 402. Increase in information return penalties. 

Sec. 403. Budget compliance. 

1 TITLE I—CELL PHONES AND 

2 ELECTRONIC FILING 

3 SEC. 101. REMOVAL OF CELLULAR TELEPHONES AND SIMI4 LAR TELECOMMUNICATIONS EQUIPMENT 

5 FROM LISTED PROPERTY. 

6 (a) IN GENERAL.—Subparagraph (A) of section 

7 280F(d)(4) (defining listed property) is amended by add8 ing ‘‘and’’ at the end of clause (iv), by striking clause (v), 

9 and by redesignating clause (vi) as clause (v). 

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

11 subsection (a) shall apply to taxable years beginning after 

12 December 31, 2009. 

13 SEC. 102. ELECTRONIC FILING EXEMPTION FOR RELIGIOUS 

14 REASONS. 

15 Paragraph (3) of section 6011(e) (relating to special 

16 rule for tax return preparers) is amended by adding at 

17 the end the following new subparagraph: 

18 ‘‘(D) EXEMPTION FOR RELIGIOUS REA19 SONS.—The Secretary may exempt from re20 quirements under subparagraph (A) a tax re21 turn preparer who— 

22 ‘‘(i) is a member of a recognized reli23 gious sect or division thereof, and 


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1 ‘‘(ii) is an adherent of established 

2 teachings or tenets that do not permit the 

3 use of magnetic media.’’. 

4 SEC. 103. ACCELERATE INTEREST ON REFUNDS FOR RE5 TURNS FILED ELECTRONICALLY. 

6 (a) IN GENERAL.—Subsection (e) of section 6611 

7 (relating to disallowance of interest on certain overpay8 ments) is amended by adding at the end the following new 

9 paragraph: 

10 ‘‘(4) SPECIAL RULE.—In the case of any indi11 vidual income tax return relating to income tax filed 

12 by electronic means, paragraph (1) shall be applied 

13 by substituting ‘30 days’ for ‘45 days’ each place it 

14 appears.’’. 

15 (b) EFFECTIVE DATE.—The amendments made by 

16 subsection (a) shall apply to taxable years beginning after 

17 December 31, 2011. 

18 TITLE II—COLLECTION 

19 SEC. 201. STUDY ON THE EFFECTIVENESS OF COLLECTION 

20 ALTERNATIVES. 

21 (a) IN GENERAL.—The Secretary of the Treasury 

22 shall conduct a study to assess the effectiveness of collec23 tion alternatives, especially offers-in-compromise, on long24 term tax compliance. Such a study shall analyze a group 

25 of taxpayers who applied for offers-in-compromise 5 or 


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1 more years ago and compare the amount of revenue col2 lected from the taxpayers whose offers were accepted with 

3 the amount of revenue collected from the taxpayers whose 

4 offers were rejected, and compare, among the taxpayers 

5 whose offers were rejected, the amount they offered with 

6 the amounts collected. 

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

8 of enactment of this Act, the Secretary of the Treasury 

9 shall submit a report to Congress containing the results 

10 of the study conducted under subsection (a). 

11 SEC. 202. REPEAL OF PARTIAL PAYMENT REQUIREMENT 

12 ON SUBMISSIONS OF OFFERS-IN-COM13 PROMISE. 

14 (a) IN GENERAL.—Section 7122 is amended by strik15 ing subsection (c) and by redesignating subsections (d), 

16 (e), (f), and (g) as subsection (c), (d), (e), and (f), respec17 tively. 

18 (b) CONFORMING AMENDMENTS.— 

19 (1) Paragraph (3) of section 7122(d) is amend20 ed— 

21 (A) by inserting ‘‘and’’ at the end of the 

22 subparagraph (A), 

23 (B) by striking ‘‘, and’’ at the end of sub24 paragraph (B) and inserting a period, and 

25 (C) by striking subparagraph (C). 


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1 (2) Subsection (f) of section 6159 is amended 

2 by striking ‘‘section 7122(e)’’ and inserting ‘‘section 

3 7122(d)’’. 

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

5 this section shall apply to offers submitted after the date 

6 of the enactment of this Act. 

7 TITLE III—TAXPAYER ASSIST8 ANCE AND PROTECTION IM9 PROVEMENTS 

10 SEC. 301. REFERRALS TO LOW-INCOME TAXPAYER CLINICS 

11 PERMITTED. 

12 (a) IN GENERAL.—Subsection (c) of section 7526 is 

13 amended by adding at the end the following new para14 graph: 

15 ‘‘(6) TREASURY EMPLOYEES PERMITTED TO

16 REFER TAXPAYERS TO QUALIFIED LOW-INCOME TAX17 PAYER CLINICS.—Notwithstanding any other provi18 sion of law, officers and employees of the Depart19 ment of the Treasury may refer taxpayers for advice 

20 and assistance to qualified low-income taxpayer clin21 ics receiving funding under this section.’’. 

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

23 this section shall apply to referrals made after the date 

24 of the enactment of this Act. 


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1 SEC. 302. LOW-INCOME TAXPAYER CLINICS. 

2 (a) INCREASE IN AUTHORIZED GRANTS.—Paragraph 

3 (1) of section 7526(c) (relating to aggregate limitation) 

4 is amended by striking ‘‘$6,000,000’’ and inserting 

5 ‘‘$20,000,000’’. 

6 (b) CLERICAL AMENDMENT.—Section 7526(c)(5) is 

7 amended by inserting ‘‘qualified’’ before ‘‘low-income’’. 

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

9 this section shall apply with respect to grants made after 

10 the date of the enactment of this Act. 

11 SEC. 303. EITC OUTREACH. 

12 (a) IN GENERAL.—Section 32 (relating to earned in13 come) is amended by adding at the end the following new 

14 subsection: 

15 ‘‘(n) NOTIFICATION OF POTENTIAL ELIGIBILITY FOR

16 CREDIT AND REFUND.— 

17 ‘‘(1) IN GENERAL.—To the extent possible and 

18 on an annual basis, the Secretary shall provide to 

19 each taxpayer who— 

20 ‘‘(A) for any preceding taxable year for 

21 which credit or refund is not precluded by sec22 tion 6511, and 

23 ‘‘(B) did not claim the credit under sub24 section (a) but may be allowed such credit for 

25 any such taxable year based on return or return 


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1 information (as defined in section 6103(b)) 

2 available to the Secretary, 

3 notice that such taxpayer may be eligible to claim 

4 such credit and a refund for such taxable year. 

5 ‘‘(2) NOTICE.—Notice provided under para6 graph (1) shall be in writing and sent to the last 

7 known address of the taxpayer.’’. 

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

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

10 of this Act. 

11 SEC. 304. TAXPAYER NOTIFICATION OF SUSPECTED IDEN12 TITY THEFT. 

13 (a) IN GENERAL.—Chapter 77 (relating to miscella14 neous provisions), as amended by this Act, is amended by 

15 adding at the end the following new section: 

16 ‘‘SEC. 7529. NOTIFICATION OF SUSPECTED IDENTITY 

17 THEFT. 

18 ‘‘If, in the course of an investigation under the inter19 nal revenue laws, the Secretary determines that there was 

20 or may have been an unauthorized use of the identity of 

21 the taxpayer or a dependent of the taxpayer, the Secretary 

22 shall, to the extent permitted by law— 

23 ‘‘(1) as soon as practicable and without jeop24 ardizing such investigation, notify the taxpayer of 

25 such determination, and 


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1 ‘‘(2) if any person is criminally charged by in2 dictment or information with respect to such unau3 thorized use, notify such taxpayer as soon as prac4 ticable of such charge.’’. 

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

6 for chapter 77 is amended by adding at the end the fol7 lowing new item: 

‘‘Sec. 7529. Notification of suspected identity theft.’’. 

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

9 this section shall apply to determinations made after the 

10 date of the enactment of this Act. 

11 SEC. 305. CLARIFICATION OF IRS UNCLAIMED REFUND AU12 THORITY. 

13 Paragraph (1) of section 6103(m) (relating to tax re14 funds) is amended by inserting ‘‘, and through any other 

15 means of mass communication,’’ after ‘‘media’’. 

16 SEC. 306. STUDY ON DELIVERY OF TAX REFUNDS. 

17 (a) IN GENERAL.—The National Taxpayer Advocate 

18 shall conduct a study on the feasibility of delivering tax 

19 refunds on debit cards, prepaid cards, and other electronic 

20 means to assist individuals that do not have access to fi21 nancial accounts or institutions. 

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

23 of enactment of this Act, the National Taxpayer Advocate 

24 shall submit a report to Congress containing the results 

25 of the study conducted under subsection (a). 


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1 SEC. 307. STUDY ON TIMELY PROCESSING AND USE OF IN2 FORMATION RETURNS. 

3 (a) IN GENERAL.—The Secretary of the Treasury 

4 shall conduct a study on the administrative and legislative 

5 changes that would be needed to receive and process infor6 mation returns before processing income tax returns. 

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

8 of the enactment of this Act, the Secretary shall submit 

9 a report to the Committee on Ways and Means of the 

10 House of Representatives and the Committee on Finance 

11 of the Senate containing the results of the study conducted 

12 under subsection (a), together with such recommendations 

13 as the Secretary considers necessary or appropriate for 

14 implementation of these changes. 

15 SEC. 308. STUDY ON EASING THE BURDEN OF IN-PERSON 

16 TAX PAYMENTS. 

17 (a) IN GENERAL.—The Secretary of the Treasury 

18 shall conduct a study on how to reduce the number of tax19 payers making payments at IRS Taxpayer Assistance 

20 Centers. The report shall include an analysis of— 

21 (1) whether the Federal Tax Deposit Coupon 

22 (Form 8109) could be expanded so that it can be 

23 used with all Federal tax deposits and payments, 

24 and 


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1 (2) what current or new return filing, payment, 

2 and proof of payment options could be implemented 

3 to reduce the burden of in-person payments. 

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

5 of the enactment of this Act, the Secretary shall submit 

6 a report to the Committee on Ways and Means of the 

7 House of Representatives and the Committee on Finance 

8 of the Senate containing the results of the study conducted 

9 under subsection (a), together with such recommendations 

10 as the Secretary considers necessary or appropriate. 

11 TITLE IV—REVENUE 

12 PROVISIONS 

13 SEC. 401. EXPANSION OF BAD CHECK PENALTY TO ELEC14 TRONIC PAYMENTS. 

15 (a) IN GENERAL.—Section 6657 (relating to bad 

16 checks) is amended by adding at the end the following: 

17 ‘‘Except as otherwise provided by the Secretary, any au18 thorization of a payment by commercially acceptable 

19 means (within the meaning of section 6311) shall be treat20 ed for purposes of this section in the same manner as a 

21 check.’’. 

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

23 subsection (a) shall apply to authorizations of payments 

24 made after December 31, 2010. 


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1 SEC. 402. INCREASE IN INFORMATION RETURN PENALTIES. 

2 (a) FAILURE TO FILE CORRECT INFORMATION RE3 TURNS.— 

4 (1) IN GENERAL.—Subsections (a)(1), 

5 (b)(1)(A), and (b)(2)(A) of section 6721 are each 

6 amended by striking ‘‘$50’’ and inserting ‘‘$100’’. 

7 (2) AGGREGATE ANNUAL LIMITATION.—Sub8 sections (a)(1), (d)(1)(A), and (e)(3)(A) of section 

9 6721 are each amended by striking ‘‘$250,000’’ and 

10 inserting ‘‘$1,500,000’’. 

11 (b) REDUCTION WHERE CORRECTION WITHIN 30 

12 DAYS.— 

13 (1) IN GENERAL.—Subparagraph (A) of section 

14 6721(b)(1) is amended by striking ‘‘$15’’ and insert15 ing ‘‘$30’’. 

16 (2) AGGREGATE ANNUAL LIMITATION.—Sub17 sections (b)(1)(B) and (d)(1)(B) of section 6721 are 

18 each amended by striking ‘‘$75,000’’ and inserting 

19 ‘‘$250,000’’. 

20 (c) REDUCTION WHERE CORRECTION ON OR BEFORE

21 AUGUST 1.— 

22 (1) IN GENERAL.—Subparagraph (A) of section 

23 6721(b)(2) is amended by striking ‘‘$30’’ and insert24 ing ‘‘$60’’. 

25 (2) AGGREGATE ANNUAL LIMITATION.—Sub26 sections (b)(2)(B) and (d)(1)(C) of section 6721 are 


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1 each amended by striking ‘‘$150,000’’ and inserting 

2 ‘‘$500,000’’. 

3 (d) AGGREGATE ANNUAL LIMITATIONS FOR PER4 SONS WITH GROSS RECEIPTS OF NOT MORE THAN

5 $5,000,000.—Paragraph (1) of section 6721(d) is amend6 ed— 

7 (1) by striking ‘‘$100,000’’ in subparagraph 

8 (A) and inserting ‘‘$500,000’’, 

9 (2) by striking ‘‘$25,000’’ in subparagraph (B) 

10 and inserting ‘‘$75,000’’, and 

11 (3) by striking ‘‘$50,000’’ in subparagraph (C) 

12 and inserting ‘‘$200,000’’. 

13 (e) PENALTY IN CASE OF INTENTIONAL DIS14 REGARD.—Paragraph (2) of section 6721(e) is amended 

15 by striking ‘‘$100’’ and inserting ‘‘$250’’. 

16 (f) ADJUSTMENT FOR INFLATION.—Section 6721 is 

17 amended by adding at the end the following new sub18 section: 

19 ‘‘(f) ADJUSTMENT FOR INFLATION.— 

20 ‘‘(1) IN GENERAL.—For each fifth calendar 

21 year beginning after 2012, each of the dollar 

22 amounts under subsections (a), (b), (d) (other than 

23 paragraph (2)(A) thereof), and (e) shall be increased 

24 by such dollar amount multiplied by the cost-of-liv25 ing adjustment determined under section 1(f)(3) deVerDate Nov 24 2008 20:56 Apr 16, 2010 Jkt 089200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\H4994.RFS H4994

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1 termined by substituting ‘calendar year 2011’ for 

2 ‘calendar year 1992’ in subparagraph (B) thereof. 

3 ‘‘(2) ROUNDING.—If any amount adjusted 

4 under paragraph (1)— 

5 ‘‘(A) is not less than $75,000 and is not 

6 a multiple of $500, such amount shall be 

7 rounded to the next lowest multiple of $500, 

8 and 

9 ‘‘(B) is not described in subparagraph (A) 

10 and is not a multiple of $10, such amount shall 

11 be rounded to the next lowest multiple of $10.’’. 

12 (g) EFFECTIVE DATE.—The amendments made by 

13 this section shall apply with respect to information returns 

14 required to be filed on or after January 1, 2011. 

15 SEC. 403. BUDGET COMPLIANCE. 

16 The budgetary effects of this Act, for the purpose of 

17 complying with the Statutory Pay-As-You-Go Act of 2010, 

18 shall be determined by reference to the latest statement 

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

20 Act, submitted for printing in the Congressional Record 

21 by the Chairman of the Committee on the Budget of the 


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1 House of Representatives, provided that such statement 

2 has been submitted prior to the vote on passage. 

Passed the House of Representatives April 14, 2010. 

Attest: LORRAINE C. MILLER, 

Clerk. 


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