(b) EFFECTIVE DATE.—The amendments made by this 
section shall apply to designations made before, on, or after 
the date of the enactment of this Act. 
TITLE IV—CONFIDENTIALITY 
AND DISCLOSURE 
SEC. 401. COLLECTION ACTIVITIES WITH RESPECT TO 
JOINT RETURN DISCLOSABLE TO EITHER 
SPOUSE BASED ON ORAL REQUEST. 
(a) IN GENERAL.—Paragraph (8) of section 6103(e) 
(relating to disclosure of collection activities with respect 
to joint return) is amended by striking ‘‘in writing’’ the 
first place it appears. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to requests made after the date of the 
enactment of this Act. 
SEC. 402. TAXPAYER REPRESENTATIVES NOT SUBJECT TO 
EXAMINATION ON SOLE BASIS OF REPRESEN-
TATION OF TAXPAYERS. 
(a) IN GENERAL.—Paragraph (1) of section 6103(h) 
(relating to disclosure to certain Federal officers and em-
ployees for purposes of tax administration, etc.) is amend-
ed—
(1) by striking ‘‘Returns’’ and inserting the fol-
lowing: 
‘‘(A) IN GENERAL.—Returns’’, and
(2) by adding at the end the following new sub-
paragraph: 
‘‘(B) TAXPAYER
REPRESENTATIVES.—Not-
withstanding subparagraph (A), the return of the 
representative of a taxpayer whose return is 
being examined by an officer or employee of the 
Department of the Treasury shall not be open to 
inspection by such officer or employee on the sole 
basis of the representative’s relationship to the 
taxpayer unless a supervisor of such officer or 
employee has approved the inspection of the re-
turn of such representative on a basis other than 
by reason of such relationship.’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall take effect on the date which is 180 days after 
the date of the enactment of this Act. 
SEC. 403. DISCLOSURE IN JUDICIAL OR ADMINISTRATIVE 
TAX PROCEEDINGS OF RETURN AND RETURN 
INFORMATION OF PERSONS WHO ARE NOT 
PARTY TO SUCH PROCEEDINGS. 
(a) IN GENERAL.—Paragraph (4) of section 6103(h) 
(relating to disclosure to certain Federal officers and em-
ployees for purposes of tax administration, etc.) is amended 
by adding at the end the following new subparagraph:
‘‘(B) DISCLOSURE IN JUDICIAL OR ADMINIS-
TRATIVE TAX PROCEEDINGS OF RETURN AND RE-
TURN INFORMATION OF PERSONS NOT PARTY TO 
SUCH PROCEEDINGS.—
‘‘(i) NOTICE.—Return or return infor-
mation of any person who is not a party to 
a judicial or administrative proceeding de-
scribed in this paragraph shall not be dis-
closed under clause (ii) or (iii) of subpara-
graph (A) until after the Secretary makes a 
reasonable effort to give notice to such per-
son and an opportunity for such person to 
request the deletion of matter from such re-
turn or return information, including any 
of the items referred to in paragraphs (1) 
through (7) of section 6110(c). Such notice 
shall include a statement of the issue or 
issues the resolution of which is the reason 
such return or return information is sought. 
In the case of S corporations, partnerships, 
estates, and trusts, such notice shall be 
made at the entity level. 
‘‘(ii) DISCLOSURE LIMITED TO PERTI-
NENT PORTION.—The only portion of a re-
turn or return information described in
clause (i) which may be disclosed under 
subparagraph (A) is that portion of such re-
turn or return information that directly re-
lates to the resolution of an issue in such 
proceeding. 
‘‘(iii) EXCEPTIONS.—Clause (i) shall 
not apply—
‘‘(I) to any civil action under sec-
tion 7407, 7408, or 7409, 
‘‘(II) to any ex parte proceeding 
for obtaining a search warrant, order 
for entry on premises or safe deposit 
boxes, or similar ex parte proceeding, 
‘‘(III) to disclosure of third party 
return information by indictment or 
criminal information, or 
‘‘(IV) if the Attorney General or 
the Attorney General’s delegate deter-
mines that the application of such 
clause would seriously impair a crimi-
nal tax investigation or proceeding.’’. 
(b) CONFORMING AMENDMENTS.—Paragraph (4) of 
section 6103(h) is amended by—
(1) by striking ‘‘PROCEEDINGS.—A return’’ and 
inserting ‘‘PROCEEDINGS.—
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), a return’’; 
(2) by redesignating subparagraphs (A), (B), 
(C), and (D) as clauses (i), (ii), (iii), and (iv), re-
spectively, and by moving such clauses 2 ems to the 
right; and 
(3) in the matter following clause (iv) (as so re-
designated), by striking ‘‘subparagraph (A), (B), or 
(C)’’ and inserting ‘‘clause (i), (ii), or (iii)’’ and by 
moving such matter 2 ems to the right. 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to proceedings commenced after the date 
of the enactment of this Act. 
SEC. 404. PROHIBITION OF DISCLOSURE OF TAXPAYER 
IDENTIFICATION 
INFORMATION 
WITH 
RE-
SPECT TO DISCLOSURE OF ACCEPTED OF-
FERS-IN-COMPROMISE. 
(a) GENERAL.—Paragraph (1) of section 6103(k) (re-
lating to disclosure of certain returns and return informa-
tion for tax administrative purposes) is amended by insert-
ing ‘‘(other than the taxpayer’s address and TIN)’’ after 
‘‘Return information’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to disclosures made after the date of the 
enactment of this Act.
SEC. 405. COMPLIANCE BY CONTRACTORS WITH CONFIDEN-
TIALITY SAFEGUARDS. 
(a) IN GENERAL.—Section 6103(p) (relating to State 
law requirements) is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(9) DISCLOSURE TO CONTRACTORS AND OTHER 
AGENTS.—Notwithstanding any other provision of 
this section, no return or return information shall be 
disclosed to any contractor or other agent of a Fed-
eral, State, or local agency unless such agency, to the 
satisfaction of the Secretary—
‘‘(A) has requirements in effect which re-
quire each such contractor or other agent which 
would have access to returns or return informa-
tion to provide safeguards (within the meaning 
of paragraph (4)) to protect the confidentiality 
of such returns or return information, 
‘‘(B) agrees to conduct an annual, on-site 
review (mid-point review in the case of contracts 
of less than 1 year in duration) of each such con-
tractor or other agent to determine compliance 
with such requirements, 
‘‘(C) submits the findings of the most recent 
review conducted under subparagraph (B) to the 
Secretary as part of the report required by para-
graph (4)(E), and