‘‘(1) any withholding agent under sections 1441 
and 1442 has the control, receipt, custody, disposal, 
or payment of any amount constituting gross income 
from sources within the United States of any foreign 
entity, including a trust, corporation, limited liability 
company, partnership, or foundation (other than an 
entity with shares regularly traded on an established 
securities market), and 
‘‘(2) such withholding agent determines for pur-
poses of title 14, 18, or 31 of the United States 
Code that a United States person has any beneficial 
interest in the foreign entity or in the account in 
such entity’s name (hereafter in this section referred 
to as ‘United States beneficial owner’), 
then the withholding agent shall make a return according 
to the forms or regulations prescribed by the Secretary. 
‘‘(b) REQUIRED INFORMATION.—For purposes of 
subsection (a) the information required to be included on 
the return shall include— 
‘‘(1) the name, address, and, if known, the tax-
payer identification number of the United States 
beneficial owner, 
‘‘(2) the known facts pertaining to the relation-
ship of such United States beneficial owner to the 
foreign entity and the account, 
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‘‘(3) the gross amount of income from sources 
within the United States (including gross proceeds 
from brokerage transactions), and 
‘‘(4) such other information as the Secretary 
may by forms or regulations provide. 
‘‘(c) STATEMENTS TO BE FURNISHED TO BENE-
FICIAL OWNERS WITH RESPECT TO WHOM INFORMATION 
IS REQUIRED TO BE REPORTED.—A withholding agent 
required to make a return under subsection (a) shall fur-
nish to each United States beneficial owner whose name 
is required to be set forth in such return a statement 
showing— 
‘‘(1) the name, address, and telephone number 
of the information contact of the person required to 
make such return, and 
‘‘(2) the information required to be shown on 
such return with respect to such United States bene-
ficial owner. 
The written statement required under the preceding sen-
tence shall be furnished to the United States beneficial 
owner on or before January 31 of the year following the 
calendar year for which the return under subsection (a) 
was required to be made. In the event the person filing 
such return does not have a current address for the United 
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States beneficial owner, such written statement may be 
mailed to the address of the foreign entity. 
‘‘SEC. 6045D. RETURNS BY FINANCIAL INSTITUTIONS RE-
GARDING ESTABLISHMENT OF ACCOUNTS IN 
NON-FATCA INSTITUTIONS. 
‘‘(a) REQUIREMENT OF RETURN.—Any financial in-
stitution directly or indirectly opening a bank, brokerage, 
or other financial account for or on behalf of an offshore 
entity, including a trust, corporation, limited liability com-
pany, partnership, or foundation (other than an entity 
with shares regularly traded on an established securities 
market), in a non-FATCA institution (as defined in sec-
tion 7701(a)(51)) at the direction of, on behalf of, or for 
the benefit of a United States person shall make a return 
according to the forms or regulations prescribed by the 
Secretary. 
‘‘(b) REQUIRED INFORMATION.—For purposes of 
subsection (a) the information required to be included on 
the return shall include— 
‘‘(1) the name, address, and taxpayer identifica-
tion number of such United States person, 
‘‘(2) the name and address of the financial in-
stitution at which a financial account is opened, the 
type of account, the account number, the name 
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under which the account was opened, and the 
amount of the initial deposit, 
‘‘(3) if the account is held in the name of an 
entity, the name and address of such entity, the type 
of entity, and the name and address of any company 
formation agent or other professional employed to 
form or acquire the entity, and 
‘‘(4) such other information as the Secretary 
may by forms or regulations provide. 
‘‘(c) STATEMENTS TO BE FURNISHED TO UNITED 
STATES PERSONS WITH RESPECT TO WHOM INFORMA-
TION IS REQUIRED TO BE REPORTED.—A financial insti-
tution required to make a return under subsection (a) 
shall furnish to each United States person whose name 
is required to be set forth in such return a statement 
showing— 
‘‘(1) the name, address, and telephone number 
of the information contact of the person required to 
make such return, and 
‘‘(2) the information required to be shown on 
such return with respect to such United States per-
son. 
The written statement required under the preceding sen-
tence shall be furnished to such United States person on 
or before January 31 of the year following the calendar 
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year for which the return under subsection (a) was re-
quired to be made. 
‘‘(d) EXEMPTION.—The Secretary may by regula-
tions exempt any class of United States persons or any 
class of accounts or entities from the requirements of this 
section if the Secretary determines that applying this sec-
tion to such persons, accounts, or entities is not necessary 
to carry out the purposes of this section.’’. 
(b) PENALTIES.— 
(1) 
RETURNS.—Section 
6724(d)(1)(B) 
is 
amended by striking ‘‘or’’ at the end of clause (xxv), 
by striking ‘‘and’’ at the end of clause (xxvi), and 
by adding after clause (xxvi) the following new 
clauses: 
‘‘(xxvii) section 6045C(a) (relating to 
returns regarding United States beneficial 
owners of financial accounts located in the 
United States and held in the name of a 
foreign entity), or 
‘‘(xxviii) section 6045D(a) (relating to 
returns by financial institutions regarding 
establishment of accounts at non-FATCA 
institutions), and’’. 
(2) PAYEE STATEMENTS.—Section 6724(d)(2) 
is amended by redesignating the second subpara-
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graph (JJ) as (KK), by striking ‘‘or’’ at the end of 
subparagraph (JJ), by striking the period at the end 
of subparagraph (KK), and by inserting after sub-
paragraph (KK) the following new subparagraphs: 
‘‘(LL) section 6045C(c) (relating to re-
turns regarding United States beneficial owners 
of financial accounts located in the United 
States and held in the name of a foreign enti-
ty), or 
‘‘(MM) section 6045D(c) (relating to re-
turns by financial institutions regarding estab-
lishment of accounts at non-FATCA institu-
tions).’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart B of part III of subchapter A of chapter 61 
is amended by inserting after the item relating to section 
6045B the following new items: 
‘‘Sec. 6045C. Returns regarding United States beneficial owners of financial 
accounts located in the United States and held in the name of 
a foreign entity. 
‘‘Sec. 6045D. Returns by financial institutions regarding establishment of ac-
counts at non-FATCA institutions.’’. 
(d) ADDITIONAL PENALTIES.— 
(1) ADDITIONAL PENALTIES ON BANKS.—Sec-
tion 5239(b)(1) of the Revised Statutes of the 
United States (12 U.S.C. 93(b)(1)) is amended by 
inserting ‘‘or any of the provisions of section 6045D 
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of the Internal Revenue Code of 1986,’’ after ‘‘any 
regulation issued pursuant to,’’. 
(2) ADDITIONAL
PENALTIES
ON
SECURITIES 
FIRMS.—Section 21(d)(3)(A) of the Securities Ex-
change Act of 1934 (15 U.S.C. 78u(d)(3)(A)) is 
amended by inserting ‘‘any of the provisions of sec-
tion 6045D of the Internal Revenue Code of 1986,’’ 
after ‘‘the rules or regulations thereunder,’’. 
(e) REGULATORY
AUTHORITY
AND
EFFECTIVE 
DATE.— 
(1) REGULATORY AUTHORITY.—Not later than 
180 days after the date of the enactment of this Act, 
the Secretary of the Treasury shall adopt regula-
tions, forms, or other guidance necessary to imple-
ment this section. 
(2) EFFECTIVE DATE.—Section 6045C of the 
Internal Revenue Code of 1986 (as added by this 
section) and the amendment made by subsection 
(d)(1) shall take effect with respect to amounts paid 
into foreign owned accounts located in the United 
States after December 31 of the year of the date of 
the enactment of this Act. Section 6045D of such 
Code (as so added) and the amendment made by 
subsection (d)(2) shall take effect with respect to ac-
counts opened after December 31 of the year of the 
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date of the enactment of this Act. Section 6045D of 
such Code (as so added) and the amendment made 
by subsection (d)(2) shall take effect with respect to 
accounts opened after December 31 of the year of 
the date of the enactment of this Act, whether or 
not regulations are issued under Section 6045D. 
SEC. 204. PENALTY FOR FAILING TO DISCLOSE OFFSHORE 
HOLDINGS. 
(a) SECURITIES EXCHANGE ACT OF 1934.—Section 
21(d)(3)(B) of the Securities Exchange Act of 1934 (15 
U.S.C. 78u(d)(3)(B)) is amended by adding at the end 
the following: 
‘‘(iv) 
FOURTH
TIER.—Notwith-
standing clauses (i), (ii), and (iii), for each 
such violation, the amount of penalty shall 
not exceed $1,000,000 for any natural per-
son or $10,000,000 for any other person, 
if— 
‘‘(I) such person directly or indi-
rectly controlled any foreign entity, in-
cluding any trust, corporation, limited 
liability 
company, 
partnership, 
or 
foundation through which an issuer 
purchased, sold, or held equity or debt 
instruments; 
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‘‘(II) such person knowingly or 
recklessly failed to disclose any such 
holding, purchase, or sale by the 
issuer; and 
‘‘(III) the holding, purchase, or 
sale would have been otherwise sub-
ject to disclosure by the issuer or such 
person under this title.’’. 
(b) SECURITIES ACT OF 1933.—Section 20(d)(2) of 
the Securities Act of 1933 (15 U.S.C. 77t(d)(2)) is 
amended by adding at the end the following: 
‘‘(D) 
FOURTH
TIER.—Notwithstanding 
subparagraphs (A), (B), and (C), for each such 
violation, the amount of penalty shall not ex-
ceed $1,000,000 for any natural person or 
$10,000,000 for any other person, if— 
‘‘(i) such person directly or indirectly 
controlled any foreign entity, including any 
trust, corporation, limited liability com-
pany, partnership, or foundation through 
which an issuer purchased, sold, or held 
equity or debt instruments; 
‘‘(ii) such person knowingly or reck-
lessly failed to disclose any such holding, 
purchase, or sale by the issuer; and 
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‘‘(iii) the holding, purchase, or sale 
would have been otherwise subject to dis-
closure by the issuer or such person under 
this title.’’. 
(c) INVESTMENT ADVISERS ACT OF 1940.—Section 
203(i)(2) of the Investment Advisers Act of 1940 (15 
U.S.C. 80b–3(i)(2)) is amended by adding at the end the 
following: 
‘‘(D) 
FOURTH
TIER.—Notwithstanding 
subparagraphs (A), (B), and (C), for each such 
violation, the amount of penalty shall not ex-
ceed $1,000,000 for any natural person or 
$10,000,000 for any other person, if— 
‘‘(i) such person directly or indirectly 
controlled any foreign entity, including any 
trust, corporation, limited liability com-
pany, partnership, or foundation through 
which an issuer purchased, sold, or held 
equity or debt instruments; 
‘‘(ii) such person knowingly or reck-
lessly failed to disclose any such holding, 
purchase, or sale by the issuer; and 
‘‘(iii) the holding, purchase, or sale 
would have been otherwise subject to dis-
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closure by the issuer or such person under 
this title.’’. 
SEC. 205. DEADLINE FOR ANTI-MONEY LAUNDERING RULE 
FOR INVESTMENT ADVISERS. 
(a) ANTI-MONEY LAUNDERING OBLIGATIONS
FOR 
INVESTMENT ADVISERS.—Section 5312(a)(2) of title 31, 
United States Code, is amended— 
(1) in subparagraph (Y), by striking ‘‘or’’ at 
the end; 
(2) by redesignating subparagraph (Z) as sub-
paragraph (BB); and 
(3) by inserting after subparagraph (Y) the fol-
lowing: 
‘‘(Z) an investment adviser (as defined in 
section 202(a) of the Investment Advisers Act 
of 1940);’’. 
(b) RULES REQUIRED.—The Secretary of the Treas-
ury shall— 
(1) in consultation with the Securities and Ex-
change Commission and the Commodity Futures 
Trading Commission, not later than 180 days after 
the date of enactment of this Act, publish a pro-
posed rule in the Federal Register to carry out the 
amendments made by this section; and 
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(2) not later than 270 days after the date of 
enactment of this Act, publish a final rule in the 
Federal Register on the matter described in para-
graph (1). 
(c) CONTENTS.—The final rule published under this 
section shall require, at a minimum, each investment ad-
viser (as defined in section 202(a)(11) of the Investment 
Advisers Act of 1940 (15 U.S.C. 80b–2(a)(11))) reg-
istered with the Securities and Exchange Commission pur-
suant to section 203 of that Act (15 U.S.C. 80b–3)— 
(1) to submit suspicious activity reports and es-
tablish an anti-money laundering program under 
subsections (g) and (h), respectively, of section 5318 
of title 31, United States Code; and 
(2) to comply with— 
(A) the customer identification program 
requirements under section 5318(l) of title 31, 
United States Code; and 
(B) the due diligence requirements under 
section 5318(i) of title 31, United States Code. 
SEC. 206. ANTI-MONEY LAUNDERING REQUIREMENTS FOR 
FORMATION AGENTS. 
(a) ANTI-MONEY LAUNDERING OBLIGATIONS
FOR 
FORMATION AGENTS.—Section 5312(a)(2) of title 31, 
United States Code, as amended by section 205 of this 
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Act, is amended by inserting after subparagraph (Z) the 
following: 
‘‘(AA) any person engaged in the business 
of forming new corporations, limited liability 
companies, partnerships, trusts, or other legal 
entities; or’’. 
(b) DEADLINE
FOR
ANTI-MONEY
LAUNDERING 
RULE FOR FORMATION AGENTS.— 
(1) PROPOSED
RULE.—The Secretary of the 
Treasury, in consultation with the Attorney General 
of the United States, the Secretary of Homeland Se-
curity, and the Commissioner of Internal Revenue, 
shall— 
(A) not later than 120 days after the date 
of enactment of this Act, publish a proposed 
rule in the Federal Register requiring persons 
described in section 5312(a)(2)(AA) of title 31, 
United States Code, as added by this section, to 
establish 
anti-money 
laundering 
programs 
under section 5318(h) of that title; and 
(B) not later than 270 days after the date 
of enactment of this Act, publish a final rule in 
the Federal Register on the matter described in 
subparagraph (A). 
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(2) EXCLUSIONS.—The rule promulgated under 
this subsection shall exclude from the category of 
persons engaged in the business of forming new cor-
porations or other entities— 
(A) any government agency; and 
(B) any attorney or law firm that uses a 
paid formation agent operating within the 
United States to form such corporations or 
other entities. 
SEC. 207. STRENGTHENING JOHN DOE SUMMONS PRO-
CEEDINGS. 
(a) IN GENERAL.—Subsection (f) of section 7609 is 
amended to read as follows: 
‘‘(f) ADDITIONAL REQUIREMENT IN THE CASE OF A 
JOHN DOE SUMMONS.— 
‘‘(1) GENERAL RULE.—Any summons described 
in subsection (c)(1) which does not identify the per-
son with respect to whose liability the summons is 
issued may be served only after a court proceeding 
in which the Secretary establishes that— 
‘‘(A) the summons relates to the investiga-
tion of a particular person or ascertainable 
group or class of persons, 
‘‘(B) there is a reasonable basis for believ-
ing that such person or group or class of per-
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sons may fail or may have failed to comply with 
any provision of any internal revenue law, and 
‘‘(C) the information sought to be obtained 
from the examination of the records or testi-
mony (and the identity of the person or persons 
with respect to whose liability the summons is 
issued) is not readily available from other 
sources. 
‘‘(2) EXCEPTION.—Paragraph (1) shall not 
apply to any summons which specifies that it is lim-
ited to information regarding a United States cor-
respondent 
account 
(as 
defined 
in 
section 
5318A(e)(1)(B) of title 31, United States Code) or 
a United States payable-through account (as defined 
in section 5318A(e)(1)(C) of such title) of a finan-
cial institution that is held at a non-FATCA institu-
tion (as defined in section 7701(a)(51)). 
‘‘(3) PRESUMPTION IN CASES INVOLVING NON- 
FATCA INSTITUTIONS.—For purposes of this section, 
in any case in which the particular person or ascer-
tainable group or class of persons have financial ac-
counts in or transactions related to a non-FATCA 
institution (as defined in section 7701(a)(51)), there 
shall be a presumption that there is a reasonable 
basis for believing that such person or group or class 
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of persons may fail or may have failed to comply 
with provisions of internal revenue law. 
‘‘(4) PROJECT JOHN DOE SUMMONSES.— 
‘‘(A) IN
GENERAL.—Notwithstanding the 
requirements of paragraph (1), the Secretary 
may issue a summons described in paragraph 
(1) if the summons— 
‘‘(i) relates to a project which is ap-
proved under subparagraph (B), 
‘‘(ii) is issued to a person who is a 
member of the group or class established 
under subparagraph (B)(i), and 
‘‘(iii) is issued within 3 years of the 
date on which such project was approved 
under subparagraph (B). 
‘‘(B) APPROVAL OF PROJECTS.—A project 
may only be approved under this subparagraph 
after a court proceeding in which the Secretary 
establishes that— 
‘‘(i) any summons issued with respect 
to the project will be issued to a member 
of an ascertainable group or class of per-
sons, and 
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‘‘(ii) any summons issued with respect 
to such project will meet the requirements 
of paragraph (1). 
‘‘(C) EXTENSION.—Upon application of 
the Secretary, the court may extend the time 
for issuing such summonses under subpara-
graph (A)(i) for additional 3-year periods, but 
only if the court continues to exercise oversight 
of such project under subparagraph (D). 
‘‘(D) ONGOING COURT OVERSIGHT.—Dur-
ing any period in which the Secretary is author-
ized to issue summonses in relation to a project 
approved under subparagraph (B) (including 
during any extension under subparagraph (C)), 
the Secretary shall report annually to the court 
on the use of such authority, provide copies of 
all summonses with such report, and comply 
with the court’s direction with respect to the 
issuance of any John Doe summons under such 
project.’’. 
(b) JURISDICTION OF COURT.— 
(1) IN
GENERAL.—Paragraph (1) of section 
7609(h) is amended by inserting after the first sen-
tence the following new sentence: ‘‘Any United 
States district court in which a member of the group 
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or class to which a summons may be issued resides 
or is found shall have jurisdiction to hear and deter-
mine the approval of a project under subsection 
(f)(4)(B).’’. 
(2) CONFORMING AMENDMENT.—The first sen-
tence of section 7609(h)(1) is amended by striking 
‘‘(f)’’ and inserting ‘‘(f)(1)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to summonses issued after the date 
of the enactment of this Act. 
SEC. 208. IMPROVING ENFORCEMENT OF FOREIGN FINAN-
CIAL ACCOUNT REPORTING. 
(a) CLARIFYING THE CONNECTION OF FOREIGN FI-
NANCIAL ACCOUNT REPORTING
TO TAX ADMINISTRA-
TION.—Paragraph (4) of section 6103(b) is amended by 
adding at the end the following new sentence: 
‘‘For purposes of subparagraph (A)(i), section 5314 
of title 31, United States Code, and sections 5321 
and 5322 of such title (as such sections pertain to 
such section 5314), shall be considered related stat-
utes.’’. 
(b) SIMPLIFYING THE CALCULATION OF FOREIGN 
FINANCIAL ACCOUNT REPORTING PENALTIES.—Section 
5321(a)(5)(D)(ii) of title 31, United States Code, is 
amended by striking ‘‘the balance in the account at the 
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time of the violation’’ and inserting ‘‘the highest balance 
in the account during the reporting period to which the 
violation relates’’. 
(c) CLARIFYING THE USE OF SUSPICIOUS ACTIVITY 
REPORTS UNDER THE BANK SECRECY ACT FOR CIVIL 
TAX LAW ENFORCEMENT.—Section 5319 of title 31, 
United States Code, is amended by inserting ‘‘the civil and 
criminal enforcement divisions of the Internal Revenue 
Service,’’ after ‘‘including’’. 
Æ 
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