exceed 250 percent of the poverty level, as 
determined in accordance with criteria es-
tablished by the Director of the Office of 
Management and Budget, in the taxable 
year preceding the request. 
‘‘(iii) SMALL
BUSINESS.—For pur-
poses of clause (ii), the term ‘small busi-
ness’ has the meaning given such term 
under section 41(b)(3)(D)(iii). 
‘‘(3) AVAILABILITY OF PROCESS.—The proce-
dures prescribed under subsection (b)(1) and the 
pilot program established under subsection (b)(2) 
shall provide the opportunity to elect mediation or 
arbitration at the time when the case is first filed 
with the Internal Revenue Service Independent Of-
fice of Appeals and at any time before deliberations 
in the appeal commence.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 9. INCREASE IN MONETARY PENALTIES FOR CERTAIN 
UNAUTHORIZED DISCLOSURES OF INFORMA-
TION. 
(a) IN GENERAL.—Paragraphs (1), (2), (3), and (4) 
of section 7213(a) of the Internal Revenue Code of 1986 
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are each amended by striking ‘‘$5,000’’ and inserting 
‘‘$10,000’’. 
(b) ADJUSTMENT FOR INFLATION.—Subsection (a) 
of section 7213 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new para-
graph: 
‘‘(6) ADJUSTMENT
FOR
INFLATION.—In the 
case of any calendar year after 2022, the $10,000 
amounts in paragraphs (1), (2), (3), and (4) shall 
each be increased by an amount equal to— 
‘‘(A) such dollar amount, multiplied by 
‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f)(3) for such calendar 
year, determined by substituting ‘calendar year 
2021’ for ‘calendar year 2016’ in subparagraph 
(A)(ii) thereof. 
If any amount as increased under the preceding sen-
tence is not a multiple of $100, such amount shall 
be rounded to the next lowest multiple of $100.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to disclosures made after the date 
of the enactment of this Act. 
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SEC. 10. BAN ON RAISING NEW ISSUES ON APPEAL. 
(a) IN GENERAL.—Chapter 77 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new section: 
‘‘SEC. 7531. PROHIBITION ON INTERNAL REVENUE SERVICE 
RAISING NEW ISSUES IN AN INTERNAL AP-
PEAL. 
‘‘(a) IN GENERAL.—In reviewing an appeal of any 
determination initially made by the Internal Revenue 
Service, the Internal Revenue Service Independent Office 
of Appeals may not consider or decide any issue that is 
not within the scope of the initial determination. 
‘‘(b) CERTAIN ISSUES DEEMED OUTSIDE OF SCOPE 
OF DETERMINATION.—For purposes of subsection (a), the 
following matters shall be considered to be not within the 
scope of a determination: 
‘‘(1) Any issue that was not raised in a notice 
of deficiency or an examiner’s report which is the 
subject of the appeal. 
‘‘(2) Any deficiency in tax which was not in-
cluded in the initial determination. 
‘‘(3) Any theory or justification for a tax defi-
ciency which was not considered in the initial deter-
mination. 
‘‘(c) NO INFERENCE WITH RESPECT
TO ISSUES 
RAISED BY TAXPAYERS.—Nothing in this section shall be 
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construed to provide any limitation in addition to any limi-
tations in effect on the date of the enactment of this sec-
tion on the right of a taxpayer to raise an issue, theory, 
or justification on an appeal from a determination initially 
made by the Internal Revenue Service that was not within 
the scope of the initial determination.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for chapter 77 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new item: 
‘‘Sec. 7531. Prohibition on Internal Revenue Service raising new issues in an 
internal appeal.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to matters filed or pending with 
the Internal Revenue Service Independent Office of Ap-
peals on or after the date of the enactment of this Act. 
SEC. 11. LIMITATION ON ENFORCEMENT OF LIENS AGAINST 
PRINCIPAL RESIDENCES. 
(a) IN GENERAL.—Section 7403(a) of the Internal 
Revenue Code of 1986 is amended— 
(1) by striking ‘‘In any case’’ and inserting the 
following: 
‘‘(1) IN GENERAL.—In any case’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(2) LIMITATION WITH RESPECT TO PRINCIPAL 
RESIDENCE.— 
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‘‘(A) IN
GENERAL.—Paragraph (1) shall 
not apply to any property used as the principal 
residence of the taxpayer (within the meaning 
of section 121) unless the Secretary of the 
Treasury makes a written determination that— 
‘‘(i) all other property of the taxpayer, 
if sold, is insufficient to pay the tax or dis-
charge the liability, and 
‘‘(ii) such action will not create an 
economic hardship for the taxpayer. 
‘‘(B) DELEGATION.—For purposes of this 
paragraph, the Secretary of the Treasury may 
not delegate any responsibilities under subpara-
graph (A) to any person other than— 
‘‘(i) the Commissioner of Internal 
Revenue, or 
‘‘(ii) a district director or assistant 
district director of the Internal Revenue 
Service.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to actions filed after the date of 
the enactment of this Act. 
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