SEC. 2. IMPOSITION OF RECORDKEEPING REQUIREMENTS 
ON THE INTERNAL REVENUE SERVICE TO 
SUBSTANTIATE COSTS INCURRED IN CAR-
RYING OUT ITS RESPONSIBILITIES. 
(a) IN GENERAL.—Section 7804 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following: 
‘‘(d) SUBSTANTIATION REQUIRED.— 
‘‘(1) IN GENERAL.—With respect to incurring 
any expense in the course of carrying out official du-
ties and responsibilities, each officer and employee of 
the Internal Revenue Service shall substantiate by 
adequate records or by sufficient evidence corrobo-
rating the officer’s or employee’s own statement— 
‘‘(A) the amount of such expense or other 
item, 
‘‘(B) the time and place of any travel, en-
tertainment, amusement, recreation, or use of 
any facility or property, 
‘‘(C) the business purpose of such expense 
or other item, and 
‘‘(D) the business relationship to the Inter-
nal Revenue Service of persons entertained or 
using the facility or property. 
‘‘(2) JOINT AND SEVERAL LIABILITY FOR FAIL-
URE TO MEET RECORDKEEPING REQUIREMENT.— 
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‘‘(A) IN
GENERAL.—Any officer or em-
ployee of the United States who fails to meet 
the requirements of section 7804(d), and any 
officer or employee of the United States who 
authorized the program, project, or activity in 
which an officer or employee fails to meet the 
requirements of section 7804(d), shall be jointly 
and severally liable for all expenses with respect 
to which such requirements were not met. 
‘‘(B) BURDEN OF PROOF.—If the officer 
and employee of the Internal Revenue Service 
provides credible evidence with respect to any 
factual issue relevant to ascertaining the liabil-
ity of the officer or employee for any failure de-
scribed in paragraph (1), the Secretary shall 
have the burden of proof with respect to such 
issue. 
‘‘(3) REGULATIONS.—The Secretary may by 
regulations provide that some or all of the require-
ments of the preceding sentence shall not apply in 
the case of an expense which does not exceed an 
amount prescribed pursuant to such regulations. 
Such regulations shall be substantially similar to the 
regulations under section 274(d). 
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‘‘(4) QUALIFIED NONPERSONAL USE OF VEHI-
CLE.—This subsection shall not apply to any quali-
fied nonpersonal use vehicle (as defined in section 
274(i)).’’. 
(b) ANNUAL AUDIT OF RECORDS.—Subsection (d) of 
section 7803 of such Code is amended by striking ‘‘and’’ 
at the end of subparagraph (F), by striking the period 
at the end of subparagraph (G) and inserting ‘‘; and’’, 
and inserting after subparagraph (G) the following: 
‘‘(H) a review of the expense substan-
tiation records required by section 7804(d).’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply with respect to expenses incurred 
and items procured after 90 days after the date of the 
enactment of this Act. 
Æ 
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