H. R. 6111—37
(d) CLERICAL AMENDMENT.—The table of sections for subpart 
D of part IV of subchapter A of chapter 1 is amended by adding 
at the end the following new item:
‘‘Sec. 45N. Mine rescue team training credit.’’.
(e) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2005. 
SEC. 406. WHISTLEBLOWER REFORMS. 
(a) AWARDS TO WHISTLEBLOWERS.—
(1) IN
GENERAL.—Section 7623 (relating to expenses of 
detection of underpayments and fraud, etc.) is amended—
(A) by striking ‘‘The Secretary’’ and inserting ‘‘(a) IN 
GENERAL.—The Secretary’’, 
(B) by striking ‘‘and’’ at the end of paragraph (1) and 
inserting ‘‘or’’, 
(C) by striking ‘‘(other than interest)’’, and 
(D) by adding at the end the following new subsection: 
‘‘(b) AWARDS TO WHISTLEBLOWERS.—
‘‘(1) IN
GENERAL.—If the Secretary proceeds with any 
administrative or judicial action described in subsection (a) 
based on information brought to the Secretary’s attention by 
an individual, such individual shall, subject to paragraph (2), 
receive as an award at least 15 percent but not more than 
30 percent of the collected proceeds (including penalties, 
interest, additions to tax, and additional amounts) resulting 
from the action (including any related actions) or from any 
settlement in response to such action. The determination of 
the amount of such award by the Whistleblower Office shall 
depend upon the extent to which the individual substantially 
contributed to such action. 
‘‘(2) AWARD IN CASE OF LESS SUBSTANTIAL CONTRIBUTION.—
‘‘(A) IN GENERAL.—In the event the action described 
in paragraph (1) is one which the Whistleblower Office 
determines to be based principally on disclosures of specific 
allegations (other than information provided by the indi-
vidual described in paragraph (1)) resulting from a judicial 
or administrative hearing, from a governmental report, 
hearing, audit, or investigation, or from the news media, 
the Whistleblower Office may award such sums as it con-
siders appropriate, but in no case more than 10 percent 
of the collected proceeds (including penalties, interest, addi-
tions to tax, and additional amounts) resulting from the 
action (including any related actions) or from any settle-
ment in response to such action, taking into account the 
significance of the individual’s information and the role 
of such individual and any legal representative of such 
individual in contributing to such action. 
‘‘(B) NONAPPLICATION
OF
PARAGRAPH
WHERE
INDI-
VIDUAL IS ORIGINAL SOURCE OF INFORMATION.—Subpara-
graph (A) shall not apply if the information resulting in 
the initiation of the action described in paragraph (1) was 
originally provided by the individual described in para-
graph (1). 
‘‘(3) REDUCTION IN OR DENIAL OF AWARD.—If the Whistle-
blower Office determines that the claim for an award under 
paragraph (1) or (2) is brought by an individual who planned
H. R. 6111—38
and initiated the actions that led to the underpayment of tax 
or actions described in subsection (a)(2), then the Whistleblower 
Office may appropriately reduce such award. If such individual 
is convicted of criminal conduct arising from the role described 
in the preceding sentence, the Whistleblower Office shall deny 
any award. 
‘‘(4) APPEAL OF AWARD DETERMINATION.—Any determina-
tion regarding an award under paragraph (1), (2), or (3) may, 
within 30 days of such determination, be appealed to the Tax 
Court (and the Tax Court shall have jurisdiction with respect 
to such matter). 
‘‘(5) APPLICATION
OF
THIS
SUBSECTION.—This subsection 
shall apply with respect to any action—
‘‘(A) against any taxpayer, but in the case of any indi-
vidual, only if such individual’s gross income exceeds 
$200,000 for any taxable year subject to such action, and 
‘‘(B) if the tax, penalties, interest, additions to tax, 
and additional amounts in dispute exceed $2,000,000. 
‘‘(6) ADDITIONAL RULES.—
‘‘(A) NO CONTRACT NECESSARY.—No contract with the 
Internal Revenue Service is necessary for any individual 
to receive an award under this subsection. 
‘‘(B) REPRESENTATION.—Any individual described in 
paragraph (1) or (2) may be represented by counsel. 
‘‘(C) SUBMISSION OF INFORMATION.—No award may be 
made under this subsection based on information submitted 
to the Secretary unless such information is submitted under 
penalty of perjury.’’. 
(2) ASSIGNMENT TO SPECIAL TRIAL JUDGES.—
(A) IN GENERAL.—Section 7443A(b) (relating to pro-
ceedings which may be assigned to special trial judges) 
is amended by striking ‘‘and’’ at the end of paragraph 
(5), by redesignating paragraph (6) as paragraph (7), and 
by inserting after paragraph (5) the following new para-
graph: 
‘‘(6) any proceeding under section 7623(b)(4), and’’. 
(B) CONFORMING
AMENDMENT.—Section 7443A(c) is 
amended by striking ‘‘or (5)’’ and inserting ‘‘(5), or (6)’’. 
(3) DEDUCTION
ALLOWED
WHETHER
OR
NOT
TAXPAYER 
ITEMIZES.—Subsection (a) of section 62 (relating to general rule 
defining adjusted gross income) is amended by inserting after 
paragraph (20) the following new paragraph: 
‘‘(21) ATTORNEYS FEES RELATING TO AWARDS TO WHISTLE-
BLOWERS.—Any deduction allowable under this chapter for 
attorney fees and court costs paid by, or on behalf of, the 
taxpayer in connection with any award under section 7623(b) 
(relating to awards to whistleblowers). The preceding sentence 
shall not apply to any deduction in excess of the amount includ-
ible in the taxpayer’s gross income for the taxable year on 
account of such award.’’. 
(b) WHISTLEBLOWER OFFICE.—
(1) IN
GENERAL.—Not later than the date which is 12 
months after the date of the enactment of this Act, the Sec-
retary of the Treasury shall issue guidance for the operation 
of a whistleblower program to be administered in the Internal 
Revenue Service by an office to be known as the ‘‘Whistleblower 
Office’’ which—
H. R. 6111—39
(A) shall at all times operate at the direction of the 
Commissioner of Internal Revenue and coordinate and con-
sult with other divisions in the Internal Revenue Service 
as directed by the Commissioner of Internal Revenue, 
(B) shall analyze information received from any indi-
vidual described in section 7623(b) of the Internal Revenue 
Code of 1986 and either investigate the matter itself or 
assign it to the appropriate Internal Revenue Service office, 
and 
(C) in its sole discretion, may ask for additional assist-
ance from such individual or any legal representative of 
such individual. 
(2) REQUEST FOR ASSISTANCE.—The guidance issued under 
paragraph (1) shall specify that any assistance requested under 
paragraph (1)(C) shall be under the direction and control of 
the Whistleblower Office or the office assigned to investigate 
the matter under paragraph (1)(A). No individual or legal rep-
resentative whose assistance is so requested may by reason 
of such request represent himself or herself as an employee 
of the Federal Government. 
(c) REPORT BY SECRETARY.—The Secretary of the Treasury shall 
each year conduct a study and report to Congress on the use 
of section 7623 of the Internal Revenue Code of 1986, including—
(1) an analysis of the use of such section during the pre-
ceding year and the results of such use, and 
(2) any legislative or administrative recommendations 
regarding the provisions of such section and its application. 
(d) EFFECTIVE DATE.—The amendments made by subsection 
(a) shall apply to information provided on or after the date of 
the enactment of this Act. 
SEC. 407. FRIVOLOUS TAX SUBMISSIONS. 
(a) CIVIL PENALTIES.—Section 6702 is amended to read as fol-
lows: 
‘‘SEC. 6702. FRIVOLOUS TAX SUBMISSIONS. 
‘‘(a) CIVIL PENALTY FOR FRIVOLOUS TAX RETURNS.—A person 
shall pay a penalty of $5,000 if—
‘‘(1) such person files what purports to be a return of 
a tax imposed by this title but which—
‘‘(A) does not contain information on which the substan-
tial correctness of the self-assessment may be judged, or 
‘‘(B) contains information that on its face indicates 
that the self-assessment is substantially incorrect, and 
‘‘(2) the conduct referred to in paragraph (1)—
‘‘(A) is based on a position which the Secretary has 
identified as frivolous under subsection (c), or 
‘‘(B) reflects a desire to delay or impede the administra-
tion of Federal tax laws. 
‘‘(b) CIVIL PENALTY FOR SPECIFIED FRIVOLOUS SUBMISSIONS.—
‘‘(1) IMPOSITION OF PENALTY.—Except as provided in para-
graph (3), any person who submits a specified frivolous submis-
sion shall pay a penalty of $5,000. 
‘‘(2) SPECIFIED
FRIVOLOUS
SUBMISSION.—For purposes of 
this section—
‘‘(A) SPECIFIED
FRIVOLOUS
SUBMISSION.—The term 
‘specified frivolous submission’ means a specified submis-
sion if any portion of such submission—
H. R. 6111—40
‘‘(i) is based on a position which the Secretary 
has identified as frivolous under subsection (c), or 
‘‘(ii) reflects a desire to delay or impede the 
administration of Federal tax laws. 
‘‘(B) 
SPECIFIED
SUBMISSION.—The 
term 
‘specified 
submission’ means—
‘‘(i) a request for a hearing under—
‘‘(I) section 6320 (relating to notice and oppor-
tunity for hearing upon filing of notice of lien), 
or 
‘‘(II) section 6330 (relating to notice and oppor-
tunity for hearing before levy), and 
‘‘(ii) an application under—
‘‘(I) section 6159 (relating to agreements for 
payment of tax liability in installments), 
‘‘(II) section 7122 (relating to compromises), 
or 
‘‘(III) section 7811 (relating to taxpayer assist-
ance orders). 
‘‘(3) OPPORTUNITY TO WITHDRAW SUBMISSION.—If the Sec-
retary provides a person with notice that a submission is a 
specified frivolous submission and such person withdraws such 
submission within 30 days after such notice, the penalty 
imposed under paragraph (1) shall not apply with respect to 
such submission. 
‘‘(c) LISTING
OF FRIVOLOUS POSITIONS.—The Secretary shall 
prescribe (and periodically revise) a list of positions which the 
Secretary has identified as being frivolous for purposes of this 
subsection. The Secretary shall not include in such list any position 
that the Secretary determines meets the requirement of section 
6662(d)(2)(B)(ii)(II). 
‘‘(d) REDUCTION OF PENALTY.—The Secretary may reduce the 
amount of any penalty imposed under this section if the Secretary 
determines that such reduction would promote compliance with 
and administration of the Federal tax laws. 
‘‘(e) PENALTIES IN ADDITION TO OTHER PENALTIES.—The pen-
alties imposed by this section shall be in addition to any other 
penalty provided by law.’’. 
(b) TREATMENT OF FRIVOLOUS REQUESTS FOR HEARINGS BEFORE 
LEVY.—
(1) FRIVOLOUS
REQUESTS
DISREGARDED.—Section 6330 
(relating to notice and opportunity for hearing before levy) 
is amended by adding at the end the following new subsection: 
‘‘(g) FRIVOLOUS REQUESTS FOR HEARING, ETC.—Notwithstanding 
any other provision of this section, if the Secretary determines 
that any portion of a request for a hearing under this section 
or section 6320 meets the requirement of clause (i) or (ii) of section 
6702(b)(2)(A), then the Secretary may treat such portion as if it 
were never submitted and such portion shall not be subject to 
any further administrative or judicial review.’’. 
(2) PRECLUSION
FROM
RAISING
FRIVOLOUS
ISSUES
AT 
HEARING.—Section 6330(c)(4) is amended—
(A) by striking ‘‘(A)’’ and inserting ‘‘(A)(i)’’; 
(B) by striking ‘‘(B)’’ and inserting ‘‘(ii)’’; 
(C) by striking the period at the end of the first sen-
tence and inserting ‘‘; or’’; and