SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Human Trafficking 
Fraud Enforcement Act of 2010’’. 
SEC. 2. AUTHORIZATION OF APPROPRIATIONS FOR TAX 
LAW ENFORCEMENT RELATING TO HUMAN 
TRAFFICKING AND PROMOTION OF COMMER-
CIAL SEX ACTS. 
(a) AUTHORIZATION OF APPROPRIATIONS.— 
(1) IN GENERAL.—There is authorized to be 
appropriated $4,000,000 for fiscal year 2011 for the 
purpose of establishing an office within the Internal 
Revenue Service to investigate and prosecute viola-
tions of the internal revenue laws by persons that 
appear to be engaged in conduct in violation of sec-
tion 1591(a), section 2421, section 2422, subsection 
(a), (d), or (e) of section 2423, section 1952, section 
1589, section 1590, or section 1351 of title 18, 
United States Code, or section 1328 of title 8, 
United States Code, or the laws of any State or ter-
ritory that prohibit the promotion of prostitution or 
of any commercial sex act (as such term is defined 
in section 1591(e)(3) of title 18, United States 
Code). 
(2) AVAILABILITY.—Any amounts appropriated 
pursuant to the authority of paragraph (1) shall re-
main available for fiscal year 2011. 
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(b) ADDITIONAL FUNDING FOR OPERATIONS OF OF-
FICE.—Unless specifically appropriated otherwise, there is 
authorized to be appropriated and is appropriated to the 
office established under subsection (a)(1) for fiscal years 
2011 and 2012 for the administration of such office an 
amount equal to the amount of any tax under chapter 1 
of the Internal Revenue Code of 1986 (including any inter-
est) collected during such fiscal years as the result of the 
actions of such office, plus any civil or criminal monetary 
penalties imposed under such Code relating to such tax 
and so collected. 
(c) REPORT.—Not later than 1 year after the date 
of the enactment of this Act, the Secretary of the Treasury 
shall report to the Committee of Ways and Means of the 
House of Representatives and the Committee on Finance 
of the Senate on the enforcement activities of the office 
established under subsection (a)(1) and shall include any 
recommendations for statutory changes to assist in future 
prosecutions under this section. 
(d) APPLICABILITY OF WHISTLEBLOWER AWARDS TO 
VICTIMS
OF HUMAN TRAFFICKING.—For purposes of 
making an award under paragraph (1) or (2) of section 
7623(b) of the Internal Revenue Code of 1986 with re-
spect to information provided by victims of any person 
convicted of violating section 1589, section 1590, section 
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1591(a), section 2421, section 2422, subsection (a), (d), 
or (e) of section 2423, or section 1952, or section 1351 
of title 18, United States Code, or section 1328 of title 
8, United States Code, or the laws of any State or terri-
tory that prohibit the promotion of prostitution or of any 
commercial sex act (as such term is defined in section 
1591(e)(3)) of title 18, United States Code), the deter-
mination of whether such person is described in such para-
graph shall be made without regard to paragraph (3) of 
section 7623(b) of such Code. 
SEC. 3. INCREASE IN CRIMINAL MONETARY PENALTY LIMI-
TATION FOR THE UNDERPAYMENT OR OVER-
PAYMENT OF TAX DUE TO FRAUD. 
(a) IN GENERAL.— 
(1) ATTEMPT TO EVADE OR DEFEAT TAX.— 
Section 7201 of the Internal Revenue Code of 1986 
(relating to attempt to evade or defeat tax) is 
amended— 
(A) by striking ‘‘Any person’’ and inserting 
the following: 
‘‘(a) IN GENERAL.—Any person’’, and 
(B) by adding at the end the following new 
subsection: 
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‘‘(b) ATTEMPT TO EVADE OR DEFEAT TAX ATTRIB-
UTABLE TO HUMAN TRAFFICKING AND COMMERCIAL SEX 
ACTS.— 
‘‘(1) IN GENERAL.—In the case of any attempt 
to evade or defeat any tax attributable to income de-
rived from an act described in paragraph (2), sub-
section (a) shall be applied— 
‘‘(A) 
by 
substituting 
‘$500,000 
($1,000,000’ for ‘$100,000 ($500,000’, and 
‘‘(B) by substituting ‘10 years’ for ‘5 
years’. 
‘‘(2) HUMAN TRAFFICKING AND COMMERCIAL 
SEX ACTS.—For purposes of paragraph (1), an act 
described in this paragraph is any act which is a vio-
lation of section 1591(a), section 2421, section 
2422, subsection (a), (d), or (e) of section 2423, sec-
tion 1952, section 1589, section 1590, or section 
1351 of title 18, United States Code, or section 
1328 of title 8, United States Code, or the laws of 
any State or territory that prohibit the promotion of 
prostitution or of any commercial sex act (as such 
term is defined in section 1591(e)(3) of title 18, 
United States Code).’’. 
(2) WILLFUL FAILURE TO FILE RETURN, SUP-
PLY INFORMATION, OR PAY TAX.—Section 7203 of 
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such Code (relating to willful failure to file return, 
supply information, or pay tax) is amended— 
(A) in the first sentence— 
(i) by striking ‘‘Any person’’ and in-
serting the following: 
‘‘(a) IN GENERAL.—Any person’’, and 
(ii) by striking ‘‘$25,000’’ and insert-
ing ‘‘$50,000’’, 
(B) in the third sentence, by striking ‘‘sec-
tion’’ and inserting ‘‘subsection’’, and 
(C) by adding at the end the following new 
subsection: 
‘‘(b) FAILURE TO FILE WITH RESPECT TO TAX AT-
TRIBUTABLE TO HUMAN TRAFFICKING AND COMMERCIAL 
SEX ACTS.—In the case of any failure with respect to any 
tax attributable to income derived from an act described 
in paragraph (2) of section 7201(b), the first sentence of 
subsection (a) shall be applied by substituting— 
‘‘(1) ‘felony’ for ‘misdemeanor’, 
‘‘(2) ‘$500,000 ($1,000,000’ for ‘$50,000 
($100,000’, and 
‘‘(3) ‘10 years’ for ‘1 year’.’’. 
(3) FRAUD AND FALSE STATEMENTS.—Section 
7206 of such Code (relating to fraud and false state-
ments) is amended— 
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