Title: A bill to repeal the violation of sovereign nations' laws and privacy matters.
Policy area: Taxation

Summary:
This bill amends the Internal Revenue Code, with respect to tax administration requirements for foreign-source income and assets, to repeal: (1) withholding requirements for payments to foreign financial institutions and other foreign entities, (2) information reporting for foreign financial assets, (3) penalties for underpayments of tax attributable to undisclosed foreign financial assets, (4) reporting requirements for shareholders of a passive foreign investment company and U.S. owners of foreign trusts, and (5) the additional penalty for failure to file required notices and information returns for certain foreign trusts.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 869 Introduced in Senate (IS)]

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115th CONGRESS
  1st Session
                                 S. 869

To repeal the violation of sovereign nations' laws and privacy matters.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                April 6 (legislative day, April 4), 2017

 Mr. Paul (for himself and Mr. Wicker) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To repeal the violation of sovereign nations' laws and privacy matters.

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

SECTION 1. REPEAL OF WITHHOLDING AND REPORTING WITH RESPECT TO CERTAIN 
              FOREIGN ACCOUNTS.

    (a) In General.--The Internal Revenue Code of 1986 is amended by 
striking chapter 4.
    (b) Conforming Amendments for Rules for Electronically Filed 
Returns.--Section 6011(e)(4) of such Code is amended--
            (1) by inserting ``, as in effect on January 1, 2017'' 
        after ``(as defined in section 1471(d)(5)'', and
            (2) by striking ``or 1474(a)''.
    (c) Conforming Amendment Related to Substitute Dividends.--Section 
871(m) of such Code is amended by striking ``chapters 3 and 4'' both 
places it appears and inserting ``chapter 3''.
    (d) Other Conforming Amendments.--
            (1) Section 6414 of such Code is amended by striking ``or 
        4''.
            (2) Paragraph (1) of section 6501(b) of such Code is 
        amended by striking ``4,''.
            (3) Paragraph (2) of section 6501(b) of such Code is 
        amended--
                    (A) by striking ``4,'', and
                    (B) by striking ``and witholding taxes'' in the 
                heading and inserting ``taxes and tax imposed by 
                chapter 3''.
            (4) Paragraph (3) of section 6513(b) of such Code is 
        amended--
                    (A) by striking ``or 4'', and
                    (B) by striking ``or 1474(b)''.
            (5) Section 6513(c) of such Code is amended by striking 
        ``4,''.
            (6) Section 6611(e)(4) of the Internal Revenue Code of 1986 
        is amended by striking ``or 4''.
            (7) Paragraph (1) of section 6724(d) of such Code is 
        amended by striking ``under chapter 4 or''.
            (8) Paragraph (2) of section 6724(d) of such Code is 
        amended by striking ``or 4''.
    (e) Effective Date.--The amendments made by this section shall 
apply to payments made after the date of the enactment of this Act.

SEC. 2. REPEAL OF INFORMATION REPORTING WITH RESPECT TO FOREIGN 
              FINANCIAL ASSETS.

    (a) In General.--Subpart A of part III of subchapter A of chapter 
61 of the Internal Revenue Code of 1986 is amended by striking section 
6038D.
    (b) Repeal of Modification of Statute of Limitations for 
Significant Omission of Income in Connection With Foreign Assets.--
            (1) Paragraph (1) of section 6501(e) of the Internal 
        Revenue Code of 1986 is amended by striking subparagraph (A) 
        and by redesignating subparagraphs (B) and (C) as subparagraphs 
        (A) and (B), respectively.
            (2) Subparagraph (A) of section 6501(e) of such Code, as 
        redesignated by paragraph (1), is amended by striking all that 
        precedes clause (i) and inserting the following:
                    ``(A) General rule.--If the taxpayer omits from 
                gross income an amount properly included therein which 
                is in excess of 25 percent of the amount of gross 
                income stated in the return, the tax may be assessed, 
                or a proceeding in court for the collection of such tax 
                may be begun without assessment, at any time within 6 
                years after the return was filed. For purposes of this 
                subparagraph--''.
            (3) Paragraph (2) of section 6229(c) of such Code is 
        amended by striking ``and such amount is described in clause 
        (i) or (ii) of section 6501(e)(1)(A)'' and inserting ``which is 
        in excess of 25 percent of the amount of gross income stated in 
        its return''.
            (4) Paragraph (8) of section 6501(c) is amended--
                    (A) by striking ``pursuant to an election under 
                section 1295(b) or'',
                    (B) by striking ``1298(f)'', and
                    (C) by striking ``6038D,''.
    (c) Clerical Amendment.--The table of sections for subpart A of 
part III of subchapter A of chapter 61 of such Code is amended by 
striking the item related to section 6038D.
    (d) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to taxable years 
        ending after the date of the enactment of this Act.
            (2) Returns.--The amendments made by subsection (b) shall 
        apply to returns filed after the date of the enactment of this 
        Act.

SEC. 3. REPEAL OF PENALTIES FOR UNDERPAYMENTS ATTRIBUTABLE TO 
              UNDISCLOSED FOREIGN FINANCIAL ASSETS.

    (a) In General.--Section 6662 of the Internal Revenue Code of 1986 
is amended--
            (1) in subsection (b), by striking paragraph (7) and 
        redesignating paragraph (8) as paragraph (7), and
            (2) by striking subsection (j) and redesignating subsection 
        (k) as subsection (j).
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 4. REPEAL OF REPORTING OF ACTIVITIES WITH RESPECT TO PASSIVE 
              FOREIGN INVESTMENT COMPANIES.

    (a) In General.--Section 1298 of the Internal Revenue Code of 1986 
is amended by striking subsection (f) and by redesignating subsection 
(g) as subsection (f).
    (b) Conforming Amendment.--Section 1291(e) of such Code is amended 
by striking ``and (d)'' and inserting ``, (d), and (f)''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.

SEC. 5. REPEAL OF REPORTING REQUIREMENT FOR UNITED STATES OWNERS OF 
              FOREIGN TRUSTS.

    (a) In General.--Paragraph (1) of section 6048(b) is amended by 
striking ``shall submit such information as the Secretary may prescribe 
with respect to such trust for such year and''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 6. REPEAL OF MINIMUM PENALTY WITH RESPECT TO FAILURE TO REPORT ON 
              CERTAIN FOREIGN TRUSTS.

    (a) In General.--Section 6677(a) of the Internal Revenue Code of 
1986 is amended--
            (1) by striking ``the greater of $10,000 or'', and
            (2) by striking the last sentence and inserting the 
        following: ``In no event shall the penalty under this 
        subsection with respect to any failure exceed the gross 
        reportable amount.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to notices and returns required to be filed after the date of the 
enactment of this Act.
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