I 
114TH CONGRESS 
2D SESSION 
H. R. 4912 
To amend the Internal Revenue Code of 1986 to reduce taxpayer burdens 
and enhance taxpayer protections, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 12, 2016 
Mr. LEWIS (for himself, Mr. RANGEL, Mr. MCDERMOTT, Mr. CROWLEY, Mr. 
PASCRELL, and Mr. DANNY K. DAVIS of Illinois) 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 reduce 
taxpayer burdens and enhance taxpayer protections, and 
for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; ETC. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Taxpayer Protection Act of 2016’’. 
(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this Act an amend-
ment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference 
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shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986, as amended. 
(c) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; etc. 
TITLE I—PROTECTION OF TAXPAYERS FROM ABUSIVE TAX 
COLLECTION PRACTICES 
Sec. 101. Repeal of rules relating to tax collection contracts. 
TITLE II—RELIEF FOR TAXPAYERS 
Sec. 201. De minimis exclusion from gross income for discharge of indebtedness 
of individuals. 
Sec. 202. Repeal suspension of statute of limitations during pending application 
for Taxpayer Assistance order. 
Sec. 203. Limitation on levy on retirement savings. 
Sec. 204. Tolling of limitation on levy recovery for disabled taxpayer. 
Sec. 205. Extension of period to withdraw frivolous submission. 
Sec. 206. Repeal of partial payment requirement on submissions of offers-in- 
compromise. 
TITLE III—ASSISTANCE FOR IDENTITY THEFT VICTIMS AND 
LOW-INCOME TAXPAYERS 
Sec. 301. Taxpayer notification of suspected identity theft. 
Sec. 302. Single point of contact for identity theft victims. 
Sec. 303. Referrals to low-income taxpayer clinics permitted. 
Sec. 304. EITC outreach. 
TITLE IV—ENSURE TAXPAYER ACCESS TO COMPETENT TAX 
RETURN PREPARERS 
Sec. 401. Regulation of tax return preparers. 
Sec. 402. Tax information disclosure relating to tax return preparer mis-
conduct. 
TITLE V—INCREASE FUNDING FOR SERVICES TO TAXPAYERS 
Sec. 501. Low-income taxpayer clinics. 
Sec. 502. Internal Revenue Service taxpayer services appropriations. 
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TITLE I—PROTECTION OF TAX-
PAYERS FROM ABUSIVE TAX 
COLLECTION PRACTICES 
SEC. 101. REPEAL OF RULES RELATING TO TAX COLLEC-
TION CONTRACTS. 
(a) IN GENERAL.—Sections 6306 and 6307 are here-
by repealed, and the table of sections for subchapter A 
of chapter 64 is amended by striking the items relating 
to sections 6306 and 6307. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 6103(k) is amended by striking 
paragraph (12). 
(2) Section 7433A(a) is amended by inserting 
‘‘, as in effect on the day before the date of the en-
actment of the Taxpayer Protection Act of 2016’’ 
after ‘‘as defined in section 6306(b)’’. 
(3) Section 7809(a) is amended by striking 
‘‘6306,’’. 
(4) Section 7811 is amended by striking sub-
section (g). 
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TITLE II—RELIEF FOR 
TAXPAYERS 
SEC. 201. DE MINIMIS EXCLUSION FROM GROSS INCOME 
FOR DISCHARGE OF INDEBTEDNESS OF INDI-
VIDUALS. 
(a) IN GENERAL.—Section 108(a)(1) is amended by 
striking ‘‘or’’ at the end of subparagraph (D), by striking 
the period at the end of subparagraph (E) and inserting 
‘‘, or’’, and by adding at the end the following new sub-
paragraph: 
‘‘(F) the indebtedness discharged is quali-
fied individual indebtedness.’’. 
(b) QUALIFIED INDIVIDUAL INDEBTEDNESS.—Sec-
tion 108 is amended by adding at the end the following 
new subsection: 
‘‘(j) SPECIAL RULES RELATING TO QUALIFIED INDI-
VIDUAL INDEBTEDNESS.— 
‘‘(1) QUALIFIED
INDIVIDUAL
INDEBTEDNESS 
DEFINED.—For purposes of this section, the term 
‘qualified individual indebtedness’ means any indebt-
edness of an individual other than indebtedness 
which is— 
‘‘(A) discharged on account of services per-
formed for the lender, or 
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‘‘(B) held at any time by a person related 
to such individual. 
For purposes of subparagraph (B), a person shall be 
treated as related to another person if the relation-
ship between such persons would result in a dis-
allowance of losses under section 267 or 707(b). 
‘‘(2) DOLLAR
LIMITATION.—The amount of 
qualified individual indebtedness excluded from gross 
income under subsection (a)(1)(F) with respect to 
any individual for any taxable year shall not exceed 
the excess of— 
‘‘(A) $10,000, over 
‘‘(B) the aggregate amount excluded from 
the gross income of such individual under sub-
section (a)(1) for such taxable year and all 
prior taxable years (determined without regard 
to any amount excludable from gross income 
under subsection (a)(1)(F) for such taxable 
year). 
‘‘(3) JOINT RETURNS.—In the case of a joint 
return— 
‘‘(A) the dollar limitation under paragraph 
(2) shall be applied separately to each spouse, 
and 
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(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to discharges of indebtedness after 
the date of the enactment of this Act. 
SEC. 202. REPEAL SUSPENSION OF STATUTE OF LIMITA-
TIONS DURING PENDING APPLICATION FOR 
TAXPAYER ASSISTANCE ORDER. 
(a) IN GENERAL.—Section 7811 is amended by strik-
ing subsection (d) and redesignating subsections (e), (f), 
and (g) as subsections (d), (e), and (f), respectively. 
(b) CONFORMING AMENDMENT.—Section 6306(k)(2) 
is amended by striking ‘‘section 7811(g)’’ and inserting 
‘‘section 7811(f)’’. 
(c) EFFECTIVE DATE.—The amendment made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 203. LIMITATION ON LEVY ON RETIREMENT SAVINGS. 
(a) IN GENERAL.—Section 6334(a) is amended by 
adding at the end the following new paragraph: 
‘‘(14) RETIREMENT SAVINGS.— 
‘‘(A) IN GENERAL.—Any individual’s inter-
est in a qualified retirement plan— 
‘‘(i) before such individual has at-
tained normal retirement age (or 65 in the 
case of an individual retirement account or 
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a plan which does not specify a normal re-
tirement age), or 
‘‘(ii) after the attainment of such age 
if the levy would create an economic hard-
ship due to the financial condition of the 
taxpayer 
(within 
the 
meaning 
of 
6343(a)(1)(D)). 
‘‘(B) QUALIFIED RETIREMENT PLAN.—For 
purposes of this paragraph, the term ‘qualified 
retirement plan’ means— 
‘‘(i) an individual retirement account, 
or 
‘‘(ii) a defined contribution plan 
which— 
‘‘(I) 
is 
described 
in 
section 
401(a) and which includes a trust ex-
empt from tax under section 501(a), 
‘‘(II) is described in subsection 
(a) or (b) of section 403, or 
‘‘(III) is an eligible deferred com-
pensation plan (as defined in section 
457(b)) of an eligible employer de-
scribed in section 457(e)(1)(A). 
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‘‘(C) EXCEPTION FOR FLAGRANT ACTS.— 
Subparagraph (A) shall not apply if the Sec-
retary determines that— 
‘‘(i) the taxpayer filed a fraudulent re-
turn, or 
‘‘(ii) the taxpayer acted with the in-
tent to evade or defeat any tax imposed by 
this title or the collection or payment 
thereof.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to levies issued after December 31, 
2016. 
SEC. 204. TOLLING OF LIMITATION ON LEVY RECOVERY 
FOR DISABLED TAXPAYER. 
(a) IN GENERAL.—Section 6343(b) is amended by in-
serting after the third sentence: ‘‘In the case of an indi-
vidual, the running of such 9-month period shall be sus-
pended during any period of such individual’s life that 
such individual is financially disabled (as defined in sec-
tion 6511(h)).’’. 
(b) SUITS BY PERSONS OTHER THAN TAXPAYERS.— 
Section 6532(c)(1) is amended by adding at the end the 
following: ‘‘In the case of an individual, the running of 
such 9-month period shall be suspended during any period 
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of such individual’s life that such individual is financially 
disabled (as defined in section 6511(h)).’’. 
SEC. 205. EXTENSION OF PERIOD TO WITHDRAW FRIVO-
LOUS SUBMISSION. 
(a) IN GENERAL.—Section 6702(b)(3) is amended by 
striking ‘‘30 days’’ and inserting ‘‘60 days’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to notices provided after December 
31, 2016. 
SEC. 206. REPEAL OF PARTIAL PAYMENT REQUIREMENT 
ON 
SUBMISSIONS 
OF 
OFFERS-IN-COM-
PROMISE. 
(a) IN GENERAL.—Section 7122 is amended by strik-
ing subsection (c) and by redesignating subsections (d), 
(e), (f), and (g) as subsection (c), (d), (e), and (f), respec-
tively. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 7122(d)(3) is amended by inserting 
‘‘and’’ at the end of the subparagraph (A), by strik-
ing ‘‘, and’’ at the end of subparagraph (B) and in-
serting a period, and by striking subparagraph (C). 
(2) Section 7122, as amended by this section, 
is amended by adding at the end the following new 
subsection: 
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‘‘(g) APPLICATION OF USER FEE.—In the case of 
any assessed tax or other amounts imposed under this title 
with respect to such tax which is the subject of an offer- 
in-compromise, such tax or other amounts shall be reduced 
by any user fee imposed under this title with respect to 
such offer-in-compromise.’’. 
(3) Section 6159(f) is amended by striking 
‘‘section 7122(e)’’ and inserting ‘‘section 7122(d)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to offers submitted after the date 
of the enactment of this Act. 
TITLE 
III—ASSISTANCE 
FOR 
IDENTITY 
THEFT 
VICTIMS 
AND 
LOW-INCOME 
TAX-
PAYERS 
SEC. 301. TAXPAYER NOTIFICATION OF SUSPECTED IDEN-
TITY THEFT. 
(a) IN GENERAL.—Chapter 77 is amended by adding 
at the end the following new section: 
‘‘SEC. 
7529. 
NOTIFICATION 
OF 
SUSPECTED 
IDENTITY 
THEFT. 
‘‘If the Secretary determines that there was an unau-
thorized use of the identity of any taxpayer, the Secretary 
shall— 
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