Title: Identity Theft and Tax Fraud Prevention Act of 2017
Policy area: Taxation

Summary:
Identity Theft and Tax Fraud Prevention Act of 2017
This bill amends the Internal Revenue Code to establish requirements and authorities for the Internal Revenue Service (IRS) related to: (1) preventing identify theft and tax refund fraud, and (2) the electronic filing of tax returns.
The IRS must:
The bill also:
The IRS and the Department of the Treasury must submit to Congress specified reports regarding identify theft and tax refund fraud.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 606 Introduced in Senate (IS)]

<DOC>






115th CONGRESS
  1st Session
                                 S. 606

To amend the Internal Revenue Code of 1986 to prevent taxpayer identity 
          theft and tax refund fraud, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 9, 2017

     Mr. Nelson (for himself, Mr. Blumenthal, Ms. Klobuchar, Mrs. 
   Gillibrand, Mr. Cardin, Mr. Casey, and Mr. Brown) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to prevent taxpayer identity 
          theft and tax refund fraud, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; ETC.

    (a) Short Title.--This Act may be cited as the ``Identity Theft and 
Tax Fraud Prevention Act of 2017''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.
    (c) Secretary.--In this Act, the term ``Secretary'' means the 
Secretary of the Treasury or the Secretary's delegate.
    (d) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; etc.
        TITLE I--IDENTITY THEFT AND TAX REFUND FRAUD PREVENTION

                     Subtitle A--General Provisions

Sec. 101. Guidelines for stolen identity refund fraud cases.
Sec. 102. Criminal penalty for misappropriating taxpayer identity in 
                            connection with tax fraud.
Sec. 103. Increased penalty for improper disclosure or use of 
                            information by preparers of returns.
Sec. 104. Notification of suspected identity theft.
Sec. 105. Local law enforcement liaison.
Subtitle B--Administrative Authority To Prevent Identity Theft and Tax 
                              Refund Fraud

Sec. 111. Authority to transfer Internal Revenue Service appropriations 
                            to combat tax fraud.
Sec. 112. Streamlined critical pay authority for information technology 
                            positions.
Sec. 113. Access to the National Directory of New Hires for tax 
                            administration purposes.
Sec. 114. Use of information in Do Not Pay Initiative in prevention of 
                            identity theft refund fraud.
Sec. 115. Minimum standards for professional tax preparers.
Sec. 116. Sense of the Senate on strengthened penalties and enforcement 
                            for impersonating an IRS official or agent.
                          Subtitle C--Reports

Sec. 121. IRS Report on stolen identity refund fraud.
Sec. 122. Report on status of the Identity Theft Tax Refund Fraud 
                            Information Sharing and Analysis Center.
Sec. 123. Report on IRS imposter phone scam.
       TITLE II--IMPROVEMENTS TO ELECTRONIC FILING OF TAX RETURNS

Sec. 201. Study on feasibility of blocking electronically filed tax 
                            returns.
Sec. 202. Enhancements to IRS PIN Program.
Sec. 203. Increasing electronic filing of returns.
Sec. 204. Internet platform for Form 1099 filings.
Sec. 205. Requirement that electronically prepared paper returns 
                            include scannable code.
Sec. 206. Authentication of users of electronic services accounts.

        TITLE I--IDENTITY THEFT AND TAX REFUND FRAUD PREVENTION

                     Subtitle A--General Provisions

SEC. 101. GUIDELINES FOR STOLEN IDENTITY REFUND FRAUD CASES.

    (a) In General.--Not later than 6 months after the date of the 
enactment of this Act, the Secretary, in consultation with the National 
Taxpayer Advocate, shall develop and implement publicly available 
guidelines for management of cases involving stolen identity refund 
fraud in a manner that reduces the administrative burden on taxpayers 
who are victims of such fraud.
    (b) Standards and Procedures To Be Considered.--The guidelines 
described in subsection (a) may include--
            (1) standards for--
                    (A) the average length of time in which a case 
                involving stolen identity refund fraud should be 
                resolved,
                    (B) the maximum length of time, on average, a 
                taxpayer who is a victim of stolen identity refund 
                fraud and is entitled to a tax refund which has been 
                stolen should have to wait to receive such refund, and
                    (C) the maximum number of offices and employees 
                within the Internal Revenue Service with whom a 
                taxpayer who is a victim of stolen identity refund 
                fraud should be required to interact in order to 
                resolve a case,
            (2) standards for opening, assigning, reassigning, or 
        closing a case involving stolen identity refund fraud, and
            (3) procedures for implementing and accomplishing the 
        standards described in paragraphs (1) and (2), and measures for 
        evaluating such procedures and determining whether such 
        standards have been successfully implemented.

SEC. 102. CRIMINAL PENALTY FOR MISAPPROPRIATING TAXPAYER IDENTITY IN 
              CONNECTION WITH TAX FRAUD.

    (a) In General.--Section 7206 is amended--
            (1) by striking ``Any person'' and inserting the following:
    ``(a) In General.--Any person'', and
            (2) by adding at the end the following new subsection:
    ``(b) Misappropriation of Identity.--Any person who willfully 
misappropriates another person's taxpayer identity (as defined in 
section 6103(b)(6)) for the purpose of making any list, return, 
account, statement, or other document submitted to the Secretary under 
the provisions of this title shall be guilty of a felony and, upon 
conviction thereof, shall be fined not more than $250,000 ($500,000 in 
the case of a corporation) or imprisoned not more than 5 years, or 
both, together with the costs of prosecution.''.
    (b) Identity Protection Personal Identification Number.--Section 
6109 is amended by inserting after subsection (d) the following new 
subsection:
    ``(e) Identity Protection Personal Identification Number.--
            ``(1) In general.--For purposes of this section, the term 
        `identifying number' shall include an identity protection 
        personal identification number, as defined in paragraph (2).
            ``(2) Definition.--The term `identity protection personal 
        identification number' means a number assigned by the Secretary 
        to a taxpayer to help prevent the misuse of the social security 
        account number of the taxpayer on fraudulent Federal income tax 
        returns and to assist the Secretary in verifying a taxpayer's 
        identity.''.
    (c) Effective Date.--The amendments made by subsection (a) shall 
apply to offenses committed on or after the date of the enactment of 
this Act.

SEC. 103. INCREASED PENALTY FOR IMPROPER DISCLOSURE OR USE OF 
              INFORMATION BY PREPARERS OF RETURNS.

    (a) In General.--Section 6713 is amended--
            (1) by redesignating subsections (b) and (c) as subsections 
        (c) and (d), respectively, and
            (2) by inserting after subsection (a) the following new 
        subsection:
    ``(b) Enhanced Penalty for Improper Use or Disclosure Relating to 
Identity Theft.--
            ``(1) In general.--In the case of a disclosure or use 
        described in subsection (a) that is made in connection with a 
        crime relating to the misappropriation of another person's 
        taxpayer identity (as defined in section 6103(b)(6)), whether 
        or not such crime involves any tax filing, subsection (a) shall 
        be applied--
                    ``(A) by substituting `$1,000' for `$250', and
                    ``(B) by substituting `$50,000' for `$10,000'.
            ``(2) Separate application of total penalty limitation.--
        The limitation on the total amount of the penalty under 
        subsection (a) shall be applied separately with respect to 
        disclosures or uses to which this subsection applies and to 
        which it does not apply.''.
    (b) Criminal Penalty.--Section 7216(a) is amended by striking 
``$1,000'' and inserting ``$1,000 ($100,000 in the case of a disclosure 
or use to which section 6713(b) applies)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to disclosures or uses on or after the date of the enactment of 
this Act.

SEC. 104. NOTIFICATION OF SUSPECTED IDENTITY 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 has been or may have been 
an unauthorized use of the identity of any individual, the Secretary 
shall, without jeopardizing an investigation relating to tax 
administration--
            ``(1) as soon as practicable, notify the individual of such 
        determination and provide--
                    ``(A) instructions on how to file a report with law 
                enforcement regarding the unauthorized use of the 
                identity of the individual,
                    ``(B) the identification of any forms necessary for 
                the individual to complete and submit to law 
                enforcement to permit access to personal information of 
                the individual during the investigation,
                    ``(C) information regarding actions the individual 
                may take in order to protect the individual from harm 
                relating to such unauthorized use, and
                    ``(D) an offer of identity protection measures to 
                be provided to the individual by the Internal Revenue 
                Service, such as the use of an identity protection 
                personal identification number (as defined in section 
                6109(e)), and
            ``(2) at the time the information described in paragraph 
        (1) is provided (or, if not available at such time, as soon as 
        practicable thereafter), issue additional notifications to such 
        individual (or such individual's designee) regarding--
                    ``(A) whether an investigation has been initiated 
                in regards to such unauthorized use,
                    ``(B) whether the investigation substantiated an 
                unauthorized use of the identity of the individual, and
                    ``(C) whether--
                            ``(i) any action has been taken against a 
                        person relating to such unauthorized use, or
                            ``(ii) any referral has been made for 
                        criminal prosecution of such person and, to the 
                        extent such information is available, whether 
                        such person has been criminally charged by 
                        indictment or information.''.
    (b) Clerical Amendment.--The table of sections for chapter 77 is 
amended by adding at the end the following new item:

``Sec. 7529. Notification of suspected identity theft.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to determinations made after the date of the enactment of this 
Act.

SEC. 105. LOCAL LAW ENFORCEMENT LIAISON.

    (a) Establishment.--The Commissioner of Internal Revenue shall 
establish within the Criminal Investigation Division of the Internal 
Revenue Service the position of Local Law Enforcement Liaison.
    (b) Duties.--The Local Law Enforcement Liaison shall serve as the 
primary source of contact for State and local law enforcement 
authorities with respect to tax-related identity theft and other tax 
fraud matters, having duties that shall include--
            (1) receiving information from State and local law 
        enforcement authorities,
            (2) responding to inquiries from State and local law 
        enforcement authorities,
            (3) administering authorized information-sharing 
        initiatives with State or local law enforcement authorities and 
        reviewing the performance of such initiatives,
            (4) ensuring any information provided through authorized 
        information-sharing initiatives with State or local law 
        enforcement authorities is used only for the prosecution of 
        identity theft-related crimes and not re-disclosed to third 
        parties, and
            (5) any other duties as delegated by the Commissioner of 
        Internal Revenue.

Subtitle B--Administrative Authority To Prevent Identity Theft and Tax 
                              Refund Fraud

SEC. 111. AUTHORITY TO TRANSFER INTERNAL REVENUE SERVICE APPROPRIATIONS 
              TO COMBAT TAX FRAUD.

    (a) In General.--For any fiscal year, in addition to any other 
authority to transfer amounts appropriated to an Internal Revenue 
Service account, the Commissioner of Internal Revenue (referred to in 
this section as the ``Commissioner'') may transfer not more than 
$10,000,000 to any account of the Internal Revenue Service from amounts 
appropriated to other Internal Revenue Service accounts. Any amounts so 
transferred shall be used solely for the purposes of preventing, 
detecting, and resolving potential cases of tax fraud, which may 
include educating taxpayers about common tax fraud scams and how to 
protect themselves from such scams.
    (b) Limitation.--The Commissioner shall not transfer any amounts 
described in subsection (a) unless the Commissioner has determined that 
taxpayer services provided by the Internal Revenue Service to the 
public (including telephone operations, forms and publications, and 
similar types of taxpayer assistance) will not be impaired by such 
transfer.

SEC. 112. STREAMLINED CRITICAL PAY AUTHORITY FOR INFORMATION TECHNOLOGY 
              POSITIONS.

    (a) Authority.--Section 9503(a) of title 5, United States Code, is 
amended--
            (1) in the matter preceding paragraph (1), by striking 
        ``the Secretary of the Treasury'' and all that follows through 
        ``establish'' and inserting ``the Secretary of the Treasury 
        may, during the period beginning on the date of the enactment 
        of the Identity Theft and Tax Fraud Prevention Act of 2017 and 
        ending on September 30, 2022, establish'', and
            (2) in paragraph (1)(B), by striking ``the Internal Revenue 
        Service's successful accomplishment of an important mission'' 
        and inserting ``the functionality of the information technology 
        operations of the Internal Revenue Service''.
    (b) Recruitment, Retention, Relocation Incentives, and Relocation 
Expenses.--Section 9504 of title 5, United States Code, is amended--
            (1) in subsection (a)--
                    (A) by striking ``Before September 30, 2013'' and 
                inserting ``During the period beginning on the date of 
                the enactment of the Identity Theft and Tax Fraud 
                Prevention Act of 2017 and ending on September 30, 
                2022'', and
                    (B) by inserting ``for employees holding positions 
                described in section 9503(a)(1)'' after ``incentives'', 
                and
            (2) in subsection (b)--
                    (A) by striking ``Before September 30, 2013'' and 
                inserting ``During the period beginning on the date of 
                the enactment of the Identity Theft and Tax Fraud 
                Prevention Act of 2017 and ending on September 30, 
                2022'',
                    (B) by striking ``employees transferred or 
                reemployed'' and inserting ``employees holding 
                positions described in section 9503(a)(1) who are 
                transferred or reemployed during such period'', and
                    (C) by striking ``section 9502 or 9503 after June 
                1, 1998'' and inserting ``section 9503 during such 
                period''.
    (c) Performance Awards for Senior Executives.--Section 9505(a) of 
title 5, United States Code, is amended--
            (1) by striking ``Before September 30, 2013'' and inserting 
        ``During the period beginning on the date of the enactment of 
        the Identity Theft and Tax Fraud Prevention Act of 2017 and 
        ending on September 30, 2022'', and
            (2) by striking ``significant functions'' and inserting 
        ``the information technology operations''.
    (d) Effective Date.--The amendments made by this section shall 
apply to payments made on or after the date of the enactment of this 
Act.

SEC. 113. ACCESS TO THE NATIONAL DIRECTORY OF NEW HIRES FOR TAX 
              ADMINISTRATION PURPOSES.

    (a) In General.--Paragraph (3) of section 453(i) of the Social 
Security Act (42 U.S.C. 653(i)) is amended to read as follows:
            ``(3) Administration of federal tax laws.--The Secretary of 
        the Treasury shall have access to the information in the 
        National Directory of New Hires solely for purposes of 
        administering the Internal Revenue Code of 1986.''.
    (b) Effective Date.--The amendment made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 114. USE OF INFORMATION IN DO NOT PAY INITIATIVE IN PREVENTION OF 
              IDENTITY THEFT REFUND FRAUD.

    The Secretary shall use the information available under the Do Not 
Pay Initiative established under section 5 of the Improper Payments 
Elimination and Recovery Improvement Act of 2012 (31 U.S.C. 3321 note) 
to help prevent identity theft refund fraud.

SEC. 115. MINIMUM STANDARDS FOR PROFESSIONAL TAX PREPARERS.

    (a) In General.--Subsection (a) of section 330 of title 31, United 
States Code, is amended--
            (1) by striking paragraph (1) and inserting the following:
            ``(1) establish minimum standards regulating--
                    ``(A) the practice of representatives of persons 
                before the Department of the Treasury; and
                    ``(B) the practice of tax return preparers; and'', 
                and
            (2) in paragraph (2)--
                    (A) by inserting ``or tax return preparer'' after 
                ``representative'' each place it appears, and
                    (B) by inserting ``or in preparing their tax 
                returns, claims for refund, or documents in connection 
                with tax returns or claims for refund'' after ``cases'' 
                in subparagraph (D).
    (b) Authority To Sanction Regulated Tax Return Preparers.--
Subsection (b) of section 330 of title 31, United States Code, is 
amended--
            (1) by striking ``before the Department'',
            (2) by inserting ``or tax return preparer'' after 
        ``representative'' each place it appears, and
            (3) in paragraph (4), by striking ``misleads or threatens'' 
        and all that follows and inserting ``misleads or threatens--
                    ``(A) any person being represented or any 
                prospective person being represented; or
                    ``(B) any person or prospective person whose tax 
                return, claim for refund, or document in connection 
                with a tax return or claim for refund, is being or may 
                be prepared.''.
    (c) Tax Return Preparer Defined.--Section 330 of title 31, United 
States Code, is amended by adding at the end the following new 
subsection:
    ``(e) Tax Return Preparer.--For purposes of this section--
            ``(1) In general.--The term `tax return preparer' has the 
        meaning given such term under section 7701(a)(36) of the 
        Internal Revenue Code of 1986.
            ``(2) Tax return.--The term `tax return' has the meaning 
        given to the term `return' under section 6696(e)(1) of the 
        Internal Revenue Code of 1986.
            ``(3) Claim for refund.--The term `claim for refund' has 
        the meaning given such term under section 6696(e)(2) of such 
        Code.''.

SEC. 116. SENSE OF THE SENATE ON STRENGTHENED PENALTIES AND ENFORCEMENT 
              FOR IMPERSONATING AN IRS OFFICIAL OR AGENT.

    It is the sense of the Senate that the penalties under section 912 
of title 18, United States Code, for impersonating an officer or 
employee acting under the authority of the United States should be 
amended to increase the penalties for impersonating an official or 
agent of the Internal Revenue Service and enforced to the fullest 
extent of the law.

                          Subtitle C--Reports

SEC. 121. IRS REPORT ON STOLEN IDENTITY REFUND FRAUD.

    (a) In General.--Not later than September 30, 2018, and every even-
numbered calendar year thereafter through September 30, 2026, the 
Secretary shall report to the Committee on Ways and Means of the House 
of Representatives and the Committee on Finance of the Senate on the 
extent and nature of stolen identity refund fraud under the Internal 
Revenue Code of 1986, as based on the most recent data that is 
available.
    (b) Contents.--The report described in subsection (a) shall 
include--
            (1) a discussion of the detection, prevention, and 
        enforcement activities undertaken by the Internal Revenue 
        Service with respect to such fraud, including--
                    (A) efforts to combat stolen identity refund fraud, 
                including an update on the victims' assistance unit (or 
                any equivalent unit),
                    (B) an update on Internal Revenue Service efforts 
                and results associated with limiting multiple refunds 
                to the same financial account and physical address, 
                with appropriate exceptions, and
                    (C) Internal Revenue Service efforts associated 
                with other avenues for addressing stolen identity 
                refund fraud,
            (2) information regarding the average and maximum amounts 
        of time that elapsed before resolution of a victim's case,
            (3) an analysis of ways to accelerate information matching 
        in order to prevent stolen identity refund fraud,
            (4) an update on the implementation of the relevant 
        provisions of this Act and the amendments made by this Act, and
            (5) identification of any further legislation to protect 
        taxpayer resources and information, including preventing tax 
        refund fraud related to the Internal Revenue Service's e-
        Services tools and electronic filing identification numbers.
    (c) Additional Information for the First Report.--The first report 
required under this section shall include--
            (1) an assessment of the progress made by the Internal 
        Revenue Service on identity theft outreach and education to 
        individuals, businesses, State agencies, and other external 
        organizations, and
            (2) the results of a study on the costs and benefits 
        relating to enhancement of the taxpayer authentication approach 
        employed by the Internal Revenue Service in the electronic tax 
        return filing process.

SEC. 122. REPORT ON STATUS OF THE IDENTITY THEFT TAX REFUND FRAUD 
              INFORMATION SHARING AND ANALYSIS CENTER.

    Not later than 90 days after the date of the enactment of this Act, 
the Secretary shall report to the Committee on Ways and Means of the 
House of Representatives and the Committee on Finance of the Senate 
on--
            (1) whether the Identity Theft Tax Refund Fraud Information 
        Sharing and Analysis Center (referred to in this section as the 
        ``Center'') is fully operational,
            (2) if the Center is not fully operational, what steps are 
        necessary for the Center to be fully operational and an 
        estimate of when the Center will be fully operational, and
            (3) any challenges that remain for effective sharing of 
        information between the public and private sectors and efforts 
        that are being undertaken to address such challenges.

SEC. 123. REPORT ON IRS IMPOSTER PHONE SCAM.

    (a) In General.--Not later than 1 year after the date of the 
enactment of this Act, the Inspector General for Tax Administration, in 
consultation with the Federal Communications Commission and the Federal 
Trade Commission, shall submit a report to Congress regarding identity 
theft phone scams under which individuals attempt to obtain personal 
information over the phone from taxpayers by falsely claiming to be 
calling from or on behalf the Internal Revenue Service.
    (b) Contents of Report.--Such report shall include--
            (1) a description of the nature and form of such scams,
            (2) an estimate of the number of taxpayers contacted 
        pursuant to, and the number of taxpayers who have been victims 
        of, such scams,
            (3) an estimate of the amount of wrongful payments obtained 
        from such scams, and
            (4) details of potential solutions to combat and prevent 
        such scams, including best practices from the private sector 
        and technological solutions.

       TITLE II--IMPROVEMENTS TO ELECTRONIC FILING OF TAX RETURNS

SEC. 201. STUDY ON FEASIBILITY OF BLOCKING ELECTRONICALLY FILED TAX 
              RETURNS.

    Not later than 180 days after the date of the enactment of this 
Act, the Secretary shall report to the Committee on Ways and Means of 
the House of Representatives and the Committee on Finance of the Senate 
on the feasibility of implementing a program under which a person who 
has filed an identity theft affidavit with the Secretary may elect to 
prevent the processing of any Federal tax return submitted in an 
electronic format by anyone purporting to be such person, including a 
recommendation on whether to implement such a program.

SEC. 202. ENHANCEMENTS TO IRS PIN PROGRAM.

    Not later than July 1, 2019, the Secretary shall establish a 
program to issue, upon request, an identity protection personal 
identification number (as described in section 6109(e)(2) of the 
Internal Revenue Code of 1986 (as added by section 102(b) of this Act)) 
to any individual after the individual's identity has been verified to 
the satisfaction of the Secretary.

SEC. 203. INCREASING ELECTRONIC FILING OF RETURNS.

    (a) In General.--Subparagraph (A) of section 6011(e)(2) is amended 
by striking ``250'' and inserting ``the applicable number of''.
    (b) Applicable Number.--Subsection (e) of section 6011 is amended 
by adding at the end the following new paragraph:
            ``(5) Applicable number.--For purposes of paragraph (2)(A), 
        the applicable number is--
                    ``(A) in the case of returns and statements 
                relating to calendar years before 2020, 250,
                    ``(B) in the case of returns and statements 
                relating to calendar year 2020, 200,
                    ``(C) in the case of returns and statements 
                relating to calendar year 2021, 150,
                    ``(D) in the case of returns and statements 
                relating to calendar year 2022, 100,
                    ``(E) in the case of returns and statements 
                relating to calendar year 2023, 50, and
                    ``(F) in the case of returns and statements 
                relating to calendar years after 2023, 20.''.
    (c) Returns Filed by a Tax Return Preparer.--
            (1) In general.--Subparagraph (A) of section 6011(e)(3) is 
        amended to read as follows:
                    ``(A) In general.--The Secretary shall require that 
                any individual income tax return which is prepared and 
                filed by a tax return preparer be filed on magnetic 
                media. The Secretary may waive the requirement of the 
                preceding sentence if the Secretary determines, on the 
                basis of an application by the tax return preparer, 
                that the preparer cannot meet such requirement based on 
                technological constraints (including lack of access to 
                the Internet).''.
            (2) Conforming amendment.--Paragraph (3) of section 6011(e) 
        is amended by striking subparagraph (B) and by redesignating 
        subparagraph (C) as subparagraph (B).
    (d) Effective Date.--The amendments made by this section shall 
apply to returns the due date for which (determined without regard to 
extensions) is after December 31, 2018.

SEC. 204. INTERNET PLATFORM FOR FORM 1099 FILINGS.

    (a) In General.--Not later than January 1, 2022, the Secretary 
shall make available an Internet website or other electronic media, 
similar to the Business Services Online Suite of Services provided by 
the Social Security Administration, that will provide taxpayers access 
to resources and guidance provided by the Internal Revenue Service and 
will allow taxpayers to--
            (1) prepare and file Forms 1099,
            (2) prepare Forms 1099 for distribution to recipients other 
        than the Internal Revenue Service, and
            (3) create and maintain necessary taxpayer records.
    (b) Early Implementation for Forms 1099-MISC.--Not later than 
January 1, 2020, the Internet website under subsection (a) shall be 
available in a partial form that will allow taxpayers to take the 
actions described in such subsection with respect to Forms 1099-MISC 
required to be filed or distributed by such taxpayers.

SEC. 205. REQUIREMENT THAT ELECTRONICALLY PREPARED PAPER RETURNS 
              INCLUDE SCANNABLE CODE.

    (a) In General.--Subsection (e) of section 6011, as amended by 
section 203(b) of this Act, is amended by adding at the end the 
following new paragraph:
            ``(6) Special rule for returns prepared electronically and 
        submitted on paper.--The Secretary shall require that any 
        return of tax which is prepared electronically, but is printed 
        and filed on paper, bear a code which can, when scanned, 
        convert such return to electronic format.''.
    (b) Conforming Amendment.--Paragraph (1) of section 6011(e) is 
amended by striking ``paragraph (3)'' and inserting ``paragraphs (3) 
and (6)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to returns of tax the due date for which (determined without 
regard to extensions) is after December 31, 2018.

SEC. 206. AUTHENTICATION OF USERS OF ELECTRONIC SERVICES ACCOUNTS.

    Beginning 180 days after the date of the enactment of this Act, the 
Secretary shall verify the identity of any individual opening an e-
Services account with the Internal Revenue Service before such 
individual is able to use the e-Services tools.
                                 <all>