I 
114TH CONGRESS 
2D SESSION 
H. R. 5725 
To amend the Internal Revenue Code of 1986 to require website-based, 
real-time responses to requests to verify taxpayer income for legitimate 
business purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 11, 2016 
Mr. MCHENRY 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 require 
website-based, real-time responses to requests to verify 
taxpayer income for legitimate business 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. 
This Act may be cited as the ‘‘IRS Data Verification 
Modernization Act of 2016’’. 
SEC. 2. DISCLOSURE OF TAXPAYER INFORMATION FOR 
THIRD-PARTY INCOME VERIFICATION. 
(a) IN GENERAL.—Section 6103(c) of the Internal 
Revenue Code of 1986 is amended— 
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(1) by striking ‘‘The Secretary may’’ and in-
serting the following: 
‘‘(1) IN GENERAL.—The Secretary shall’’, and 
(2) by adding at the end the following new 
paragraph: 
‘‘(2) 
DISCLOSURE
FOR
INCOME 
VERIFICATION.—With respect to any program estab-
lished by the Secretary to disclose returns and re-
turn information to an entity engaged in the process 
of confirming the income of a taxpayer for a legiti-
mate business purpose, or a designee of any such en-
tity, the Secretary shall ensure the following: 
‘‘(A) The disclosure process is conducted 
entirely through fully automated and electronic 
means accessible through the Internet. 
‘‘(B) The disclosure process is able to be 
completed in as close to real-time as is prac-
ticable. 
‘‘(3) SECURITY
REQUIREMENTS
FOR
RECIPI-
ENTS.—The recipients authorized to receive returns 
or return information on behalf of taxpayers shall 
maintain adequate security to protect the informa-
tion being disclosed.’’. 
(b) EFFICIENT USE OF AGENCY RESOURCES.—In es-
tablishing the program to electronically automate income 
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verification disclosures under section 6103(c)(2) of the In-
ternal Revenue Code of 1986, as added by this section, 
the Secretary shall, to the extent practicable, make use 
of resources in operation or in development at the Internal 
Revenue Service, including databases, application pro-
gramming interfaces, and other computerized systems, 
programs, and resources. 
(c) REPORT.—Not later than 6 months after the date 
of the enactment of this Act, the Secretary of the Treasury 
shall submit a written report to Congress on any progress 
made on the implementation of section 6103(c)(2) of the 
Internal Revenue Code of 1986, as added by this section. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply with respect to disclosures made 
after the date that is one year after the date of the enact-
ment of this Act. 
Æ 
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