SEC. 2. PROHIBITION ON AWARD OF CONTRACT OR GRANT 
IN 
EXCESS 
OF 
SIMPLIFIED 
ACQUISITION 
THRESHOLD TO POTENTIAL CONTRACTOR 
OR GRANT APPLICANT WITH SERIOUSLY DE-
LINQUENT TAX DEBT. 
(a) GOVERNMENTAL POLICY.—It is the policy of the 
United States Government that no Government contracts 
or grants should be awarded to individuals or companies 
with seriously delinquent Federal tax debts. 
(b) DISCLOSURE AND EVALUATION OF CONTRACT 
OFFERS FROM DELINQUENT FEDERAL DEBTORS.— 
(1) IN GENERAL.—The head of any executive 
agency that issues a solicitation for bids or a request 
for proposals for a contract in an amount greater 
than the simplified acquisition threshold shall re-
quire each person that submits a bid or proposal to 
submit with the bid or proposal a form— 
(A) certifying whether such person has a 
seriously delinquent tax debt; and 
(B) authorizing the Secretary of the Treas-
ury to disclose to the head of the agency infor-
mation limited to describing whether the person 
has a seriously delinquent tax debt. 
(2) IMPACT
ON
RESPONSIBILITY
DETERMINA-
TION.—The head of any executive agency, in evalu-
ating any offer received in response to a solicitation 
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issued by the agency for bids or proposals for a con-
tract, shall consider a certification that the offeror 
has a seriously delinquent tax debt to be definitive 
proof that the offeror is not a responsible source as 
defined in section 113 of title 41, United States 
Code. 
(3) DEBARMENT.— 
(A) REQUIREMENT.—Except as provided 
in subparagraph (B), the head of an executive 
agency shall initiate a suspension or debarment 
proceeding against a person after receiving an 
offer for a contract from such person if— 
(i) such offer contains a certification 
(as required under paragraph (1)(A)) that 
such person has a seriously delinquent tax 
debt; or 
(ii) the head of the agency receives in-
formation from the Secretary of the Treas-
ury 
(as 
authorized 
under 
paragraph 
(1)(B)) demonstrating that such a certifi-
cation submitted by such person is false. 
(B) WAIVER.—The head of an executive 
agency may waive subparagraph (A) with re-
spect to a person based upon a written finding 
of urgent and compelling circumstances signifi-
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cantly affecting the interests of the United 
States. If the head of an executive agency 
waives subparagraph (A) for a person, the head 
of the agency shall submit to the Committee on 
Oversight and Government Reform of the 
House of Representatives and the Committee 
on Homeland Security and Governmental Af-
fairs of the Senate, within 30 days after the 
waiver is made, a report containing the ration-
ale for the waiver and relevant information sup-
porting the waiver decision. 
(4) RELEASE
OF
INFORMATION.—The Sec-
retary of the Treasury, in consultation with the Di-
rector of the Office of Management and Budget, 
shall make available to all executive agencies a 
standard form for the authorization described in 
paragraph (1)(B). 
(5) REVISION
OF
REGULATIONS.—Not later 
than 270 days after the date of the enactment of 
this Act, the Federal Acquisition Regulation shall be 
revised to incorporate the requirements of this sec-
tion. 
(c) DISCLOSURE AND EVALUATION OF GRANT APPLI-
CATIONS FROM DELINQUENT FEDERAL DEBTORS.— 
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(1) IN GENERAL.—The head of any executive 
agency that offers a grant in excess of an amount 
equal to the simplified acquisition threshold shall re-
quire each grant applicant to submit with the grant 
application a form— 
(A) certifying whether such applicant has a 
seriously delinquent tax debt; and 
(B) authorizing the Secretary of the Treas-
ury to disclose to the head of the agency infor-
mation limited to describing whether the appli-
cant has a seriously delinquent tax debt. 
(2) IMPACT ON DETERMINATION OF FINANCIAL 
STABILITY.—The head of any executive agency, in 
evaluating any application for a grant offered by the 
agency, shall consider a certification under para-
graph (1)(A) that the grant applicant has a seri-
ously delinquent tax debt to be definitive proof that 
the applicant is high-risk and shall— 
(A) decline the grant application; 
(B) ensure that the applicant does not re-
ceive any future grant offered by the agency; 
and 
(C) in the case of an applicant that has, as 
of the date on which the grant application is de-
nied under subparagraph (A), an existing grant 
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previously awarded by the agency, take appro-
priate measures under guidelines issued by the 
Office of Management and Budget pursuant to 
paragraph (5) for enhanced oversight of the ap-
plicant. 
(3) DEBARMENT.— 
(A) REQUIREMENT.—Except as provided 
in subparagraph (B), the head of an executive 
agency shall initiate a suspension or debarment 
proceeding against a grant applicant after re-
ceiving a grant application from such applicant 
if— 
(i) such application contains a certifi-
cation 
(as 
required 
under 
paragraph 
(1)(A)) that such applicant has a seriously 
delinquent tax debt; or 
(ii) the head of the agency receives in-
formation from the Secretary of the Treas-
ury 
(as 
authorized 
under 
paragraph 
(1)(B)) demonstrating that such a certifi-
cation submitted by such applicant is false. 
(B) WAIVER.—The head of an executive 
agency may waive subparagraph (A) with re-
spect to an applicant based upon a written find-
ing of urgent and compelling circumstances sig-
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nificantly affecting the interests of the United 
States. If the head of an executive agency 
waives subparagraph (A) for an applicant, the 
head of the agency shall submit to the Com-
mittee on Oversight and Government Reform of 
the House of Representatives and the Com-
mittee on Homeland Security and Govern-
mental Affairs of the Senate, within 30 days 
after the waiver is made, a report containing 
the rationale for the waiver and relevant infor-
mation supporting the waiver decision. 
(4) RELEASE
OF
INFORMATION.—The Sec-
retary of the Treasury, in consultation with the Di-
rector of the Office of Management and Budget, 
shall make available to all executive agencies a 
standard form for the authorization described in 
paragraph (1)(B). 
(5) REVISION
OF
REGULATIONS.—Not later 
than 270 days after the date of the enactment of 
this Act, the Director of the Office of Management 
and Budget shall revise such regulations as nec-
essary to incorporate the requirements of this sec-
tion. 
(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section: 
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(1) EXECUTIVE AGENCY.—The term ‘‘executive 
agency’’ has the meaning given such term in section 
133 of title 41, United States Code. 
(2) SERIOUSLY DELINQUENT TAX DEBT.— 
(A) IN GENERAL.—The term ‘‘seriously de-
linquent tax debt’’ means a Federal tax liability 
that— 
(i) has been assessed by the Secretary 
of the Treasury under the Internal Rev-
enue Code of 1986; and 
(ii) may be collected by the Secretary 
by levy or by a proceeding in court. 
(B) EXCEPTIONS.—Such term does not in-
clude— 
(i) a debt that is being paid in a time-
ly manner pursuant to an agreement under 
section 6159 or section 7122 of such Code; 
(ii) a debt with respect to which a col-
lection due process hearing under section 
6330 of such Code, or relief under sub-
section (a), (b), or (f) of section 6015 of 
such Code, is requested or pending; 
(iii) a debt with respect to which a 
continuous levy has been issued under sec-
tion 6331 of such Code (or, in the case of 
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an applicant for employment, a debt with 
respect to which the applicant agrees to be 
subject to such a levy); and 
(iv) a debt with respect to which such 
a 
levy 
is 
released 
under 
section 
6343(a)(1)(D) of such Code. 
(e) EFFECTIVE DATE.—This section shall apply with 
respect to contracts and grants awarded on or after the 
date occurring 270 days after the date of the enactment 
of this Act. 
SEC. 3. INELIGIBILITY OF NONCOMPLIANT TAXPAYERS FOR 
FEDERAL EMPLOYMENT. 
(a) IN GENERAL.—Chapter 73 of title 5, United 
States Code, is amended by adding at the end the fol-
lowing: 
‘‘SUBCHAPTER VIII—INELIGIBILITY OF NON-
COMPLIANT TAXPAYERS FOR FEDERAL EM-
PLOYMENT 
‘‘§ 7381. Definitions 
‘‘For purposes of this subchapter— 
‘‘(1) The term ‘seriously delinquent tax debt’ 
means a Federal tax liability that has been assessed 
by the Secretary of the Treasury under the Internal 
Revenue Code of 1986 and may be collected by the 
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Secretary by levy or by a proceeding in court, except 
that such term does not include— 
‘‘(A) a debt that is being paid in a timely 
manner pursuant to an agreement under sec-
tion 6159 or section 7122 of such Code; 
‘‘(B) a debt with respect to which a collec-
tion due process hearing under section 6330 of 
such Code, or relief under subsection (a), (b), 
or (f) of section 6015 of such Code, is re-
quested or pending; 
‘‘(C) a debt with respect to which a contin-
uous levy has been issued under section 6331 of 
such Code (or, in the case of an applicant for 
employment, a debt with respect to which the 
applicant agrees to be subject to such a levy); 
and 
‘‘(D) a debt with respect to which such a 
levy is released under section 6343(a)(1)(D) of 
such Code; 
‘‘(2) the term ‘employee’ means an employee in 
or under an agency, including an individual de-
scribed in sections 2104(b) and 2105(e); and 
‘‘(3) the term ‘agency’ means— 
‘‘(A) an Executive agency; 
‘‘(B) the United States Postal Service; 
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‘‘(C) the Postal Regulatory Commission; 
and 
‘‘(D) an employing authority in the legisla-
tive branch. 
‘‘§ 7382. Ineligibility for employment 
‘‘(a) IN GENERAL.—Subject to subsection (c), an in-
dividual is ineligible to be appointed or to continue serving 
as an employee if such individual— 
‘‘(1) has a seriously delinquent tax debt; 
‘‘(2) does not submit the certification required 
under subsection (b); or 
‘‘(3) does not submit an authorization form re-
quested under section 7383(b)(1). 
‘‘(b) DISCLOSURE REQUIREMENT.—The head of each 
agency shall take appropriate measures to ensure that 
each individual applying for employment with such agency 
shall be required to submit (as part of the application for 
employment) certification that such individual does not 
have any seriously delinquent tax debt. 
‘‘(c) REGULATIONS.—The Office of Personnel Man-
agement, in consultation with the Internal Revenue Serv-
ice, shall, for purposes of carrying out this section with 
respect to the executive branch, promulgate any regula-
tions which the Office considers necessary, except that 
such regulations shall provide for the following: 
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‘‘(1) All applicable due process rights, afforded 
by chapter 75 and any other provision of law, shall 
apply with respect to a determination under this sec-
tion that an applicant is ineligible to be appointed 
or that an employee is ineligible to continue serving. 
‘‘(2) Before any such determination is given ef-
fect with respect to an individual, the individual 
shall be afforded 180 days to demonstrate that such 
individual’s debt is one described in subparagraph 
(A), (B), (C), or (D) of section 7381(1). 
‘‘(3) An employee may continue to serve, in a 
situation involving financial hardship, if the contin-
ued service of such employee is in the best interests 
of the United States, as determined on a case-by- 
case basis and certified as such by the head of the 
agency. 
‘‘(d) REPORTS TO CONGRESS.—The Director of the 
Office of Personnel Management shall report annually to 
the Committee on Oversight and Government Reform of 
the House of Representatives and the Committee on 
Homeland Security and Governmental Affairs of the Sen-
ate on the number of exemptions requested and the num-
ber of exemptions granted under subsection (c)(3). 
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‘‘§ 7383. Review of public records 
‘‘(a) IN GENERAL.—Each agency shall provide for 
such reviews of public records as the head of such agency 
considers appropriate to determine if a notice of lien has 
been filed pursuant to section 6323 of the Internal Rev-
enue Code of 1986 with respect to an employee of or an 
applicant for employment with such agency. 
‘‘(b) ADDITIONAL REQUESTS.—If a notice of lien is 
discovered under subsection (a) with respect to an em-
ployee or applicant for employment, the agency may— 
‘‘(1) request that the employee or applicant exe-
cute and submit a form authorizing the Secretary of 
the Treasury to disclose to the head of the agency 
information limited to describing whether— 
‘‘(A) the employee or applicant has a seri-
ously delinquent tax debt; or 
‘‘(B) there is a final administrative or judi-
cial determination that such employee or appli-
cant committed any act described under section 
7385(b); and 
‘‘(2) request that the Secretary of the Treasury 
disclose any information so authorized to be dis-
closed. 
‘‘(c) AUTHORIZATION FORM.—The Secretary of the 
Treasury shall make available to all agencies a standard 
form for the authorization described in subsection (b)(1). 
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‘‘§ 7384. Confidentiality 
‘‘Neither the head nor any other employee of an agen-
cy may— 
‘‘(1) use any information furnished under the 
provisions of this subchapter for any purpose other 
than the administration of this subchapter; 
‘‘(2) make any publication whereby the infor-
mation furnished by or with respect to any par-
ticular individual under this subchapter can be iden-
tified; or 
‘‘(3) permit anyone who is not an employee of 
such agency to examine or otherwise have access to 
any such information. 
‘‘§ 7385. Adverse actions for employees who under-
state taxes or fail to file 
‘‘(a) IN GENERAL.— 
‘‘(1) IN GENERAL.—Subject to subsection (c) 
and paragraph (2) of this subsection, the head of an 
agency may take any personnel action against an 
employee of such agency if there is a final adminis-
trative or judicial determination that such employee 
committed any act described under subsection (b). 
‘‘(2) PERSONNEL ACTIONS.—In paragraph (1), 
the term ‘personnel action’ includes separation but 
does not include administrative leave or any other 
type of paid leave without duty or charge to leave. 
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‘‘(b) ACTS.—The acts referred to under subsection 
(a)(1) are— 
‘‘(1) willful failure to file any return of tax re-
quired under the Internal Revenue Code of 1986, 
unless such failure is due to reasonable cause and 
not to willful neglect; or 
‘‘(2) willful understatement of Federal tax li-
ability, unless such understatement is due to reason-
able cause and not to willful neglect. 
‘‘(c) PROCEDURE.—Under regulations prescribed by 
the Office of Personnel Management, an employee subject 
to a personnel action under this section shall be entitled 
to the procedures provided under sections 7513 or 7543, 
as applicable.’’. 
(b) CLERICAL AMENDMENT.—The analysis for chap-
ter 73 of title 5, United States Code, is amended by add-
ing at the end the following: 
‘‘SUBCHAPTER VIII—INELIGIBILITY OF NONCOMPLIANT 
TAXPAYERS FOR FEDERAL EMPLOYMENT 
‘‘7381. Definitions. 
‘‘7382. Ineligibility for employment. 
‘‘7383. Review of public records. 
‘‘7384. Confidentiality. 
‘‘7385. Adverse actions for employees who understate taxes or fail to file.’’. 
(c) EFFECTIVE DATE.—This section, and the amend-
ments made by this section, shall take effect 270 days 
after the date of the enactment of this Act. 
Æ 
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