A bill to amend the Internal Revenue Code of 1986 to modify procedural requirements for penalties and disallowance periods.

This bill changes the rules the IRS must follow before it can charge a tax penalty or bar a taxpayer from claiming certain tax credits for a period of time. Before a penalty is assessed or a disallowance period takes effect, the decision must be approved in writing on an electronic form by the decision-maker's immediate supervisor or by the IRS Office of Servicewide Penalties. That approval must happen on or before the date the taxpayer is first sent a notice that lets them appeal to the IRS Independent Office of Appeals or ask a federal court for review. The disallowance periods covered are those for the child tax credit, education credits, and the earned income tax credit, and approval is required even when the period is calculated automatically by computer. The changes apply to notices sent more than 12 months after the bill becomes law, and the Treasury must publish a yearly report on IRS penalties starting within 24 months.

Full text and official record on Congress.gov

Sponsors

• Michael F. Bennet Democrat sponsor
• 0 cosponsors