I 
109TH CONGRESS 
1ST SESSION H. R. 1621 
To amend the Internal Revenue Code of 1986 to repeal the authority of 
the Secretary of the Treasury to enter into private tax collection contracts. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 13, 2005 
Mr. SIMMONS (for himself, Mr. VAN HOLLEN, Mrs. CAPITO, Mr. FERGUSON, 
Mr. ROGERS of Michigan, Mr. WILSON of South Carolina, Mr. HOEK-
STRA, Mrs. MILLER of Michigan, Mr. GERLACH, Mr. MCCOTTER, Mr. 
MCHUGH, Mr. SHIMKUS, Mr. DAVIS of Kentucky, Mr. SMITH of New 
Jersey, Mr. PITTS, Mr. LOBIONDO, Mr. HAYES, Mr. HOYER, Mr. MORAN 
of Virginia, Ms. KILPATRICK of Michigan, Ms. ROYBAL-ALLARD, Ms. 
LINDA T. SA´NCHEZ of California, Mr. CARDIN, Ms. NORTON, Mr. 
BISHOP of New York, Mr. PRICE of North Carolina, Mr. COOPER, Mr. 
TIBERI, Mr. HOLT, Mr. RANGEL, Mr. FRANK of Massachusetts, Ms. 
FOXX, and Mr. LATOURETTE) introduced the following bill; which was 
referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to repeal 
the authority of the Secretary of the Treasury to enter 
into private tax collection contracts. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; FINDINGS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Taxpayer Protection Act of 2005’’.
(b) FINDINGS.—The Congress finds the following: 
(1) The integrity of the Federal tax system is 
integral to the efficient and ongoing functioning of 
representative democracy. 
(2) A pillar of exemplary citizenship is compli-
ance with the Federal tax code as it pertains to indi-
vidual income taxes. 
(3) Individual taxpayers voluntarily disclose 
sensitive personal information to the Federal Gov-
ernment with the expectation that such information 
will be utilized and retained only by qualified, 
trained, and accountable personnel of the Internal 
Revenue Service (IRS) . 
(4) Although the IRS has stated that there will 
be tight restrictions on what information will be re-
leased to private collection agencies, the statute 
places no restrictions on what information may be 
released to private collection agencies. 
(5) More than 26 million Americans have, since 
1990, been victims of some form of ‘‘identity theft’’ 
through misappropriation and misuse of their per-
sonal information. 
(6) Disclosure of taxpayer information to non-
governmental, third party vendors will increase the
risk of wrongful disclosure of taxpayer information 
that results in higher incidences of ‘‘identity theft’’. 
(7) The IRS has already demonstrated its in-
ability to protect taxpayer data from unauthorized 
disclosure under existing vendor contracts as docu-
mented in an internal report by the Department of 
Treasury Inspector General for Tax Administration. 
(8) The IRS Restructuring and Reform Act of 
1998 specifically prevents employees or supervisors 
at the IRS from being evaluated or compensated 
based on how much they collect in order to prevent 
incentives for overly aggressive and abusive tactics. 
(9) The compensation scheme for private tax 
collection agencies is a recovery fee of up to 25 per-
cent of funds collected that will lead to overzealous 
and abusive collection tactics against taxpayers. 
(10) The Congress has previously rejected the 
use of private tax collection agencies by canceling a 
pilot program in 1996 due to violations by private 
collection agencies of the Fair Debt Collection Prac-
tices Act, inadequate protection of sensitive taxpayer 
information, and a loss of approximately $17 million 
during the pilot program. 
(11) A 2002 report by the IRS Commissioner 
to the IRS Oversight Board identified an additional
$30 billion in taxes owed that could be collected an-
nually by increased funding for IRS personnel. A $9 
billion annual increase in revenue could be achieved 
by earmarking approximately $300 million to spe-
cific IRS collection functions, for a return of $30 for 
every $1 spent. 
(12) Due to the vagaries of the budget scoring 
process, additional funds collected by IRS personnel 
do not ‘‘score’’ as increased revenues. 
(13) The use of private collection agencies was 
deemed a ‘‘new tool’’ to the IRS Commissioner that 
resulted in increased revenue being ‘‘scored’’ to the 
Federal Government when such activity would actu-
ally result in increased cost to taxpayers. 
(14) Members of the House of Representatives 
were not afforded the opportunity to specifically vote 
on this significant policy change during consider-
ation of H.R. 4520, the American Jobs Creation Act 
of 2004, in the 108th Congress. 
SEC. 2. REPEAL OF AUTHORITY TO ENTER INTO PRIVATE 
TAX COLLECTION CONTRACTS. 
(a) IN GENERAL.—Subchapter A of chapter 64 of the 
Internal Revenue Code of 1986 (relating to collection) is 
amended by striking section 6306. 
(b) CONFORMING AMENDMENTS.—
(1) Subchapter B of chapter 64 of such Code 
is amended by striking section 7433A. 
(2) Section 7809(a) of such Code is amended 
by striking ‘‘6306,’’. 
(3) Section 7811 of such Code is amended by 
striking subsection (g). 
(4) Section 1203 of the Internal Revenue Serv-
ice Restructuring Act of 1998 is amended by strik-
ing subsection (e). 
(5) The table of sections of subchapter A of 
chapter 64 of such Code is amended by striking the 
item relating to section 6306. 
(6) The table of sections of subchapter B of 
chapter 64 of such Code is amended by striking the 
item relating to section 7433A. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act but shall not apply to any contract entered 
into before such date. 
(d) TERMINATION OF REPORTING REQUIREMENT.— 
The reporting requirement of section 881(e) of the Amer-
ican Jobs Creation Act of 2004 shall not apply after the 
date of the enactment of this Act. 
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