507 
HR 1591 PP 
‘‘FAILURE TO PAY AN INSTALLMENT OR ANY OTHER TAX LI-
ABILITY WHEN DUE OR TO PROVIDE REQUESTED FINANCIAL 
INFORMATION’’ and inserting ‘‘FAILURE
TO
MAKE
PAY-
MENTS OR DEPOSITS OR FILE RETURNS WHEN DUE OR TO 
PROVIDE REQUESTED FINANCIAL INFORMATION’’. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to failures occurring on or after the date 
of the enactment of this Act. 
SEC. 554. OFFICE OF CHIEF COUNSEL REVIEW OF OFFERS- 
IN-COMPROMISE. 
(a) IN GENERAL.—Section 7122(b) (relating to record) 
is amended by striking ‘‘Whenever a compromise’’ and all 
that follows through ‘‘his delegate, with his reasons therefor’’ 
and inserting ‘‘If the Secretary determines that an opinion 
of the General Counsel for the Department of the Treasury, 
or the Counsel’s delegate, is required with respect to a com-
promise, there shall be placed on file in the office of the 
Secretary such opinion, with the reasons therefor’’. 
(b) CONFORMING AMENDMENTS.—Section 7122(b) is 
amended by striking the second and third sentences. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to offers-in-compromise submitted or 
pending on or after the date of the enactment of this Act. 
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SEC. 555. AUTHORIZATION FOR FINANCIAL MANAGEMENT 
SERVICE RETENTION OF TRANSACTION FEES 
FROM LEVIED AMOUNTS. 
(a) IN GENERAL.—Subsection (h) of section 6331 (re-
lating to continuing levy on certain payments) is amended 
by adding at the end the following new paragraph: 
‘‘(4) IMPOSITION
OF
FINANCIAL
MANAGEMENT 
SERVICES TRANSACTION FEES.—If the Secretary ap-
proves a levy under this subsection, the Secretary 
may impose on the taxpayer a transaction fee suffi-
cient to cover the full cost of implementing the levy 
under this subsection. Such fee— 
‘‘(A) shall be treated as an expense under 
section 6341, 
‘‘(B) may be collected through a levy under 
this subsection, and 
‘‘(C) shall be in addition to the amount of 
tax liability with respect to which such levy was 
approved.’’. 
(b) RETENTION OF FEES BY FINANCIAL MANAGEMENT 
SERVICE.—The Financial Management Service may retain 
the amount of any transaction fee imposed under section 
6331(h)(4) of the Internal Revenue Code of 1986. Any 
amount retained by the Financial Management Service 
under that section shall be deposited into the account of the 
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Department of the Treasury under section 3711(g)(7) of 
title 31, United States Code. 
(c) EFFECTIVE DATE.—The amendment made by this 
section shall apply to amounts levied after the date of the 
enactment of this Act. 
SEC. 556. AUTHORITY FOR UNDERCOVER OPERATIONS. 
Paragraph (6) of section 7608(c) (relating to applica-
tion of section) is amended by striking ‘‘2007’’ both places 
it appears and inserting ‘‘2008’’. 
SEC. 557. INCREASE IN PENALTY EXCISE TAXES ON THE PO-
LITICAL AND EXCESS LOBBYING ACTIVITIES 
OF SECTION 501(c)(3) ORGANIZATIONS. 
(a) TAXES ON DISQUALIFYING LOBBYING EXPENDI-
TURES OF CERTAIN ORGANIZATIONS.— 
(1) IN GENERAL.—Section 4912(a) (relating to 
tax on organization) is amended by striking ‘‘5 per-
cent’’ and inserting ‘‘10 percent’’. 
(2) TAX ON MANAGEMENT.—Section 4912(b) is 
amended by striking ‘‘5 percent’’ and inserting ‘‘10 
percent’’. 
(b) TAXES ON POLITICAL EXPENDITURES OF SECTION 
501(c)(3) ORGANIZATIONS.— 
(1) IN GENERAL.—Section 4955(a) (relating to 
initial taxes) is amended— 
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