H. R. 3151—5 
‘‘(II) in the case of any other taxpayer, a tax-
payer whose gross receipts do not exceed $5 million 
for the taxable year to which the dispute relates. 
‘‘(ii) AGGREGATION
RULE.—Rules similar to the 
rules of section 448(c)(2) shall apply for purposes of 
clause (i)(II).’’. 
(b) CONFORMING AMENDMENTS.— 
(1) The following provisions are each amended by striking 
‘‘Internal Revenue Service Office of Appeals’’ and inserting 
‘‘Internal Revenue Service Independent Office of Appeals’’: 
(A) Section 6015(c)(4)(B)(ii)(I). 
(B) Section 6320(b)(1). 
(C) Subsections (b)(1) and (d)(3) of section 6330. 
(D) Section 6603(d)(3)(B). 
(E) Section 6621(c)(2)(A)(i). 
(F) Section 7122(e)(2). 
(G) Subsections (a), (b)(1), (b)(2), and (c)(1) of section 
7123. 
(H) Subsections (c)(7)(B)(i) and (g)(2)(A) of section 7430. 
(I) Section 7522(b)(3). 
(J) Section 7612(c)(2)(A). 
(2) Section 7430(c)(2) is amended by striking ‘‘Internal Rev-
enue Service Office of Appeals’’ each place it appears and 
inserting ‘‘Internal Revenue Service Independent Office of 
Appeals’’. 
(3) The heading of section 6330(d)(3) is amended by 
inserting ‘‘INDEPENDENT’’ after ‘‘IRS’’. 
(c) OTHER REFERENCES.—Any reference in any provision of 
law, or regulation or other guidance, to the Internal Revenue Service 
Office of Appeals shall be treated as a reference to the Internal 
Revenue Service Independent Office of Appeals. 
(d) SAVINGS PROVISIONS.—Rules similar to the rules of para-
graphs (2) through (6) of section 1001(b) of the Internal Revenue 
Service Restructuring and Reform Act of 1998 shall apply for pur-
poses of this section (and the amendments made by this section). 
(e) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall take effect 
on the date of the enactment of this Act. 
(2) ACCESS
TO
CASE
FILES.—Section 7803(e)(7) of the 
Internal Revenue Code of 1986, as added by subsection (a), 
shall apply to conferences occurring after the date which is 
1 year after the date of the enactment of this Act. 
Subtitle B—Improved Service 
SEC. 1101. COMPREHENSIVE CUSTOMER SERVICE STRATEGY. 
(a) IN GENERAL.—Not later than the date which is 1 year 
after the date of the enactment of this Act, the Secretary of the 
Treasury (or the Secretary’s delegate) shall submit to Congress 
a written comprehensive customer service strategy for the Internal 
Revenue Service. Such strategy shall include— 
(1) a plan to provide assistance to taxpayers that is secure, 
designed to meet reasonable taxpayer expectations, and adopts 
appropriate best practices of customer service provided in the
H. R. 3151—6 
private sector, including online services, telephone call back 
services, and training of employees providing customer services; 
(2) a thorough assessment of the services that the Internal 
Revenue Service can co-locate with other Federal services or 
offer as self-service options; 
(3) proposals to improve Internal Revenue Service customer 
service in the short term (the current and following fiscal 
year), medium term (approximately 3 to 5 fiscal years), and 
long term (approximately 10 fiscal years); 
(4) a plan to update guidance and training materials for 
customer service employees of the Internal Revenue Service, 
including the Internal Revenue Manual, to reflect such strategy; 
and 
(5) identified metrics and benchmarks for quantitatively 
measuring the progress of the Internal Revenue Service in 
implementing such strategy. 
(b) UPDATED GUIDANCE AND TRAINING MATERIALS.—Not later 
than 2 years after the date of the enactment of this Act, the 
Secretary of the Treasury (or the Secretary’s delegate) shall make 
available the updated guidance and training materials described 
in subsection (a)(4) (including the Internal Revenue Manual). Such 
updated guidance and training materials (including the Internal 
Revenue Manual) shall be written in a manner so as to be easily 
understood by customer service employees of the Internal Revenue 
Service and shall provide clear instructions. 
SEC. 1102. LOW-INCOME EXCEPTION FOR PAYMENTS OTHERWISE 
REQUIRED IN CONNECTION WITH A SUBMISSION OF AN 
OFFER-IN-COMPROMISE. 
(a) IN GENERAL.—Section 7122(c) is amended by adding at 
the end the following new paragraph: 
‘‘(3) EXCEPTION FOR LOW-INCOME TAXPAYERS.—Paragraph 
(1), and any user fee otherwise required in connection with 
the submission of an offer-in-compromise, shall not apply to 
any offer-in-compromise with respect to a taxpayer who is 
an individual with adjusted gross income, as determined for 
the most recent taxable year for which such information is 
available, which does not exceed 250 percent of the applicable 
poverty level (as determined by the Secretary).’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to offers-in-compromise submitted after the date of 
the enactment of this Act. 
Subtitle C—Sensible Enforcement 
SEC. 1201. INTERNAL REVENUE SERVICE SEIZURE REQUIREMENTS 
WITH RESPECT TO STRUCTURING TRANSACTIONS. 
Section 5317(c)(2) of title 31, United States Code, is amended— 
(1) by striking ‘‘Any property’’ and inserting the following: 
‘‘(A) IN GENERAL.—Any property’’; and 
(2) by adding at the end the following: 
‘‘(B) INTERNAL
REVENUE
SERVICE
SEIZURE
REQUIRE-
MENTS
WITH
RESPECT
TO
STRUCTURING
TRANSACTIONS.— 
‘‘(i) PROPERTY DERIVED FROM AN ILLEGAL SOURCE.— 
Property may only be seized by the Internal Revenue 
Service pursuant to subparagraph (A) by reason of
H. R. 3151—7 
a claimed violation of section 5324 if the property 
to be seized was derived from an illegal source or 
the funds were structured for the purpose of concealing 
the violation of a criminal law or regulation other 
than section 5324. 
‘‘(ii) NOTICE.—Not later than 30 days after prop-
erty is seized by the Internal Revenue Service pursuant 
to subparagraph (A), the Internal Revenue Service 
shall— 
‘‘(I) make a good faith effort to find all persons 
with an ownership interest in such property; and 
‘‘(II) provide each such person so found with 
a notice of the seizure and of the person’s rights 
under clause (iv). 
‘‘(iii) EXTENSION OF NOTICE UNDER CERTAIN CIR-
CUMSTANCES.—The Internal Revenue Service may 
apply to a court of competent jurisdiction for one 30- 
day extension of the notice requirement under clause 
(ii) if the Internal Revenue Service can establish prob-
able cause of an imminent threat to national security 
or personal safety necessitating such extension. 
‘‘(iv) POST-SEIZURE HEARING.—If a person with an 
ownership interest in property seized pursuant to 
subparagraph (A) by the Internal Revenue Service 
requests a hearing by a court of competent jurisdiction 
within 30 days after the date on which notice is pro-
vided under subclause (ii), such property shall be 
returned unless the court holds an adversarial hearing 
and finds within 30 days of such request (or such 
longer period as the court may provide, but only on 
request of an interested party) that there is probable 
cause to believe that there is a violation of section 
5324 involving such property and probable cause to 
believe that the property to be seized was derived 
from an illegal source or the funds were structured 
for the purpose of concealing the violation of a criminal 
law or regulation other than section 5324.’’. 
SEC. 1202. EXCLUSION OF INTEREST RECEIVED IN ACTION TO 
RECOVER PROPERTY SEIZED BY THE INTERNAL REVENUE 
SERVICE BASED ON STRUCTURING TRANSACTION. 
(a) IN GENERAL.—Part III of subchapter B of chapter 1 is 
amended by inserting before section 140 the following new section: 
‘‘SEC. 139H. INTEREST RECEIVED IN ACTION TO RECOVER PROPERTY 
SEIZED BY THE INTERNAL REVENUE SERVICE BASED ON 
STRUCTURING TRANSACTION. 
‘‘Gross income shall not include any interest received from 
the Federal Government in connection with an action to recover 
property seized by the Internal Revenue Service pursuant to section 
5317(c)(2) of title 31, United States Code, by reason of a claimed 
violation of section 5324 of such title.’’.
H. R. 3151—8 
(b) CLERICAL AMENDMENT.—The table of sections for part III 
of subchapter B of chapter 1 is amended by inserting before the 
item relating to section 140 the following new item: 
‘‘Sec. 139H. Interest received in action to recover property seized by the Internal 
Revenue Service based on structuring transaction.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to interest received on or after the date of the enactment 
of this Act. 
SEC. 1203. CLARIFICATION OF EQUITABLE RELIEF FROM JOINT 
LIABILITY. 
(a) IN GENERAL.—Section 6015 is amended— 
(1) in subsection (e), by adding at the end the following 
new paragraph: 
‘‘(7) STANDARD AND SCOPE OF REVIEW.—Any review of a 
determination made under this section shall be reviewed de 
novo by the Tax Court and shall be based upon— 
‘‘(A) the administrative record established at the time 
of the determination, and 
‘‘(B) any additional newly discovered or previously 
unavailable evidence.’’; and 
(2) by amending subsection (f) to read as follows: 
‘‘(f) EQUITABLE RELIEF.— 
‘‘(1) IN GENERAL.—Under procedures prescribed by the Sec-
retary, if— 
‘‘(A) taking into account all the facts and cir-
cumstances, it is inequitable to hold the individual liable 
for any unpaid tax or any deficiency (or any portion of 
either), and 
‘‘(B) relief is not available to such individual under 
subsection (b) or (c), 
the Secretary may relieve such individual of such liability. 
‘‘(2) LIMITATION.—A request for equitable relief under this 
subsection may be made with respect to any portion of any 
liability that— 
‘‘(A) has not been paid, provided that such request 
is made before the expiration of the applicable period of 
limitation under section 6502, or 
‘‘(B) has been paid, provided that such request is made 
during the period in which the individual could submit 
a timely claim for refund or credit of such payment.’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to petitions or requests filed or pending on or after 
the date of the enactment of this Act. 
SEC. 1204. MODIFICATION OF PROCEDURES FOR ISSUANCE OF THIRD- 
PARTY SUMMONS. 
(a) IN GENERAL.—Section 7609(f) is amended by adding at 
the end the following flush sentence: 
‘‘The Secretary shall not issue any summons described in the pre-
ceding sentence unless the information sought to be obtained is 
narrowly tailored to information that pertains to the failure (or 
potential failure) of the person or group or class of persons referred 
to in paragraph (2) to comply with one or more provisions of 
the internal revenue law which have been identified for purposes 
of such paragraph.’’.