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CONFERENCE REPORT ON H.R. 2676, INTERNAL REVENUE SERVICE RESTRUCTURING AND REFORM ACT OF 1998
(House of Representatives - June 24, 1998)
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CONFERENCE REPORT ON
H.R. 2676, INTERNAL REVENUE SERVICE RESTRUCTURING
AND REFORM ACT OF 1998
Mr. ARCHER submitted the following conference report and statement on
the bill (
H.R. 2676) to amend the Internal Revenue Code of 1986 to
restructure and reform the Internal Revenue Service, and for other
purposes:
Conference Report (H. Rept. 105-599)
The committee of conference on the disagreeing votes of the
two Houses on the amendment of the Senate to the bill (
H.R.
2676) to amend the Internal Revenue Code of 1986 to
restructure and reform the Internal Revenue Service, and for
other purposes, having met, after full and free conference,
have agreed to recommend and do recommend to their respective
Houses as follows:
That the House recede from its disagreement to the
amendment of the Senate, and agree to the same with an
amendment, as follows:
In lieu of the matter stricken and inserted by said
amendment, insert:
SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE; WAIVER OF
ESTIMATED TAX PENALTIES; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Internal
Revenue Service Restructuring and Reform Act of 1998''.
(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) Waiver of Estimated Tax Penalties.--No addition to tax
shall be made under section 6654 or 6655 of the Internal
Revenue Code of 1986 with respect to any underpayment of an
installment required to be paid on or before the 30th day
after the date of the enactment of this Act to the extent
such underpayment was created or increased by any provision
of this Act.
(d) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; amendment of 1986 Code; waiver of estimated tax
penalties; table of contents.
TITLE I--REORGANIZATION OF STRUCTURE AND MANAGEMENT OF THE INTERNAL
REVENUE SERVICE
Subtitle A--Reorganization of the Internal Revenue Service
Sec. 1001. Reorganization of the internal revenue service.
Sec. 1002. IRS mission to focus on taxpayers' needs.
Subtitle B--Executive Branch Governance and Senior Management
Sec. 1101. Internal Revenue Service Oversight Board.
Sec. 1102. Commissioner of Internal Revenue; other officials.
Sec. 1103. Treasury Inspector General for Tax Administration.
Sec. 1104. Other personnel.
Sec. 1105. Prohibition on executive branch influence over taxpayer
audits and other investigations.
Subtitle C--Personnel Flexibilities
Sec. 1201. Improvements in personnel flexibilities.
Sec. 1202. Voluntary separation incentive payments.
Sec. 1203. Termination of employment for misconduct.
Sec. 1204. Basis for evaluation of Internal Revenue Service employees.
Sec. 1205. Employee training program.
TITLE II--ELECTRONIC FILING
Sec. 2001. Electronic filing of tax and information returns.
Sec. 2002. Due date for certain information returns.
Sec. 2003. Paperless electronic filing.
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H5101]]
Sec. 2004. Return-free tax system.
Sec. 2005. Access to account information.
TITLE III--TAXPAYER PROTECTION AND RIGHTS
Sec. 3000. Short title.
Subtitle A--Burden of Proof
Sec. 3001. Burden of proof.
Subtitle B--Proceedings by Taxpayers
Sec. 3101. Expansion of authority to award costs and certain fees.
Sec. 3102. Civil damages for collection actions.
Sec. 3103. Increase in size of cases permitted on small case calendar.
Sec. 3104. Actions for refund with respect to certain estates which
have elected the installment method of payment.
Sec. 3105. Administrative appeal of adverse IRS determination of tax-
exempt status of bond issue.
Sec. 3106. Civil action for release of erroneous lien.
Subtitle C--Relief for Innocent Spouses and for Taxpayers Unable To
Manage Their Financial Affairs Due to Disabilities
Sec. 3201. Relief from joint and several liability on joint return.
Sec. 3202. Suspension of statute of limitations on filing refund claims
during periods of disability.
Subtitle D--Provisions Relating to Interest and Penalties
Sec. 3301. Elimination of interest rate differential on overlapping
periods of interest on tax overpayments and
underpayments.
Sec. 3302. Increase in overpayment rate payable to taxpayers other than
corporations.
Sec. 3303. Mitigation of penalty on individual's failure to pay for
months during period of installment agreement.
Sec. 3304. Mitigation of failure to deposit penalty.
Sec. 3305. Suspension of interest and certain penalties where Secretary
fails to contact individual taxpayer.
Sec. 3306. Procedural requirements for imposition of penalties and
additions to tax.
Sec. 3307. Personal delivery of notice of penalty under section 6672.
Sec. 3308. Notice of interest charges.
Sec. 3309. Abatement of interest on underpayments by taxpayers in
Presidentially declared disaster areas.
Subtitle E--Protections for Taxpayers Subject to Audit or Collection
Activities
Part I--Due Process
Sec. 3401. Due process in IRS collection actions.
Part II--Examination Activities
Sec. 3411. Confidentiality privileges relating to taxpayer
communications.
Sec. 3412. Limitation on financial status audit techniques.
Sec. 3413. Software trade secrets protection.
Sec. 3414. Threat of audit prohibited to coerce tip reporting
alternative commitment agreements.
Sec. 3415. Taxpayers allowed motion to quash all third-party summonses.
Sec. 3416. Service of summonses to third-party recordkeepers permitted
by mail.
Sec. 3417. Notice of IRS contact of third parties.
Part III--Collection Activities
SUBPART A--APPROVAL PROCESS
Sec. 3421. Approval process for liens, levies, and seizures.
SUBPART B--LIENS AND LEVIES
Sec. 3431. Modifications to certain levy exemption amounts.
Sec. 3432. Release of levy upon agreement that amount is uncollectible.
Sec. 3433. Levy prohibited during pendency of refund proceedings.
Sec. 3434. Approval required for jeopardy and termination assessments
and jeopardy levies.
Sec. 3435. Increase in amount of certain property on which lien not
valid.
Sec. 3436. Waiver of early withdrawal tax for IRS levies on employer-
sponsored retirement plans or IRAs.
SUBPART C--SEIZURES
Sec. 3441. Prohibition of sales of seized property at less than minimum
bid.
Sec. 3442. Accounting of sales of seized property.
Sec. 3443. Uniform asset disposal mechanism.
Sec. 3444. Codification of IRS administrative procedures for seizure of
taxpayer's property.
Sec. 3445. Procedures for seizure of residences and businesses.
Part IV--Provisions Relating to Examination and Collection Activities
Sec. 3461. Procedures relating to extensions of statute of limitations
by agreement.
Sec. 3462. Offers-in-compromise.
Sec. 3463. Notice of deficiency to specify deadlines for filing Tax
Court petition.
Sec. 3464. Refund or credit of overpayments before final determination.
Sec. 3465. IRS procedures relating to appeals of examinations and
collections.
Sec. 3466. Application of certain fair debt collection procedures.
Sec. 3467. Guaranteed availability of installment agreements.
Sec. 3468. Prohibition on requests to taxpayers to give up rights to
bring actions.
Subtitle F--Disclosures to Taxpayers
Sec. 3501. Explanation of joint and several liability.
Sec. 3502. Explanation of taxpayers' rights in interviews with the
Internal Revenue Service.
Sec. 3503. Disclosure of criteria for examination selection.
Sec. 3504. Explanations of appeals and collection process.
Sec. 3505. Explanation of reason for refund disallowance.
Sec. 3506. Statements regarding installment agreements.
Sec. 3507. Notification of change in tax matters partner.
Sec. 3508. Disclosure to taxpayers.
Sec. 3509. Disclosure of Chief Counsel advice.
Subtitle G--Low Income Taxpayer Clinics
Sec. 3601. Low income taxpayer clinics.
Subtitle H--Other Matters
Sec. 3701. Cataloging complaints.
Sec. 3702. Archive of records of Internal Revenue Service.
Sec. 3703. Payment of taxes.
Sec. 3704. Clarification of authority of Secretary relating to the
making of elections.
Sec. 3705. IRS employee contacts.
Sec. 3706. Use of pseudonyms by IRS employees.
Sec. 3707. Illegal tax protester designation.
Sec. 3708. Provision of confidential information to Congress by
whistleblowers.
Sec. 3709. Listing of local IRS telephone numbers and addresses.
Sec. 3710. Identification of return preparers.
Sec. 3711. Offset of past-due, legally enforceable State income tax
obligations against overpayments.
Sec. 3712. Reporting requirements in connection with education tax
credit.
Subtitle I--Studies
Sec. 3801. Administration of penalties and interest.
Sec. 3802. Confidentiality of tax return information.
Sec. 3803. Study of noncompliance with internal revenue laws by
taxpayers.
Sec. 3804. Study of payments made for detection of underpayments and
fraud.
TITLE IV--CONGRESSIONAL ACCOUNTABILITY FOR THE INTERNAL REVENUE SERVICE
Subtitle A--Oversight
Sec. 4001. Expansion of duties of the Joint Committee on Taxation.
Sec. 4002. Coordinated oversight reports.
Subtitle B--Century Date Change
Sec. 4011. Century date change.
Subtitle C--Tax Law Complexity
Sec. 4021. Role of the Internal Revenue Service.
Sec. 4022. Tax law complexity analysis.
TITLE V--ADDITIONAL PROVISIONS
Sec. 5001. Lower capital gains rates to apply to property held more
than 1 year.
Sec. 5002. Clarification of exclusion of meals for certain employees.
Sec. 5003. Clarification of designation of normal trade relations.
TITLE VI--TECHNICAL CORRECTIONS
Sec. 6001. Short title; coordination with other titles.
Sec. 6002. Definitions.
Sec. 6003. Amendments related to title I of 1997 Act.
Sec. 6004. Amendments related to title II of 1997 Act.
Sec. 6005. Amendments related to title III of 1997 Act.
Sec. 6006. Amendment related to title IV of 1997 Act.
Sec. 6007. Amendments related to title V of 1997 Act.
Sec. 6008. Amendments related to title VII of 1997 Act.
Sec. 6009. Amendments related to title IX of 1997 Act.
Sec. 6010. Amendments related to title X of 1997 Act.
Sec. 6011. Amendments related to title XI of 1997 Act.
Sec. 6012. Amendments related to title XII of 1997 Act.
Sec. 6013. Amendments related to title XIII of 1997 Act.
Sec. 6014. Amendments related to title XIV of 1997 Act.
Sec. 6015. Amendments related to title XV of 1997 Act.
Sec. 6016. Amendments related to title XVI of 1997 Act.
Sec. 6017. Amendment related to Transportation Equity Act for the 21st
Century.
Sec. 6018. Amendments related to Small Business Job Protection Act of
1996.
Sec. 6019. Amendments related to Taxpayer Bill of Rights 2.
Sec. 6020. Amendment related to Omnibus Budget Reconciliation Act of
1993.
Sec. 6021. Amendment related to Revenue Reconciliation Act of 1990.
Sec. 6022. Amendment related to Tax Reform Act of 1986.
Sec. 6023. Miscellaneous clerical and deadwood changes.
Sec. 6024. Effective date.
TITLE VII--REVENUE PROVISIONS
Sec. 7001. Clarification of deduction for deferred compensation.
Sec. 7002. Termination of exception for certain real estate investment
trusts from the treatment of stapled entities.
Sec. 7003. Certain customer receivables ineligible for mark-to-market
treatment.
Sec. 7004. Modification of AGI limit for conversions to Roth IRAs.
TITLE VIII--IDENTIFICATION OF LIMITED TAX BENEFITS SUBJECT TO LINE ITEM
VETO
Sec. 8001. Identification of limited tax benefits subject to line item
veto.
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TITLE IX--TECHNICAL CORRECTIONS TO TRANSPORTATION EQUITY ACT FOR THE
21ST CENTURY
Sec. 9001. Short title.
Sec. 9002. Authorization and program subtitle.
Sec. 9003. Restorations to general provisions subtitle.
Sec. 9004. Restorations to program streamlining and flexibility
subtitle.
Sec. 9005. Restorations to safety subtitle.
Sec. 9006. Elimination of duplicate provisions.
Sec. 9007. Highway finance.
Sec. 9008. High priority projects technical corrections.
Sec. 9009. Federal Transit Administration programs.
Sec. 9010. Motor carrier safety technical correction.
Sec. 9011. Restorations to research title.
Sec. 9012. Automobile safety and information.
Sec. 9013. Technical corrections regarding subtitle A of title VIII.
Sec. 9014. Corrections to veterans subtitle.
Sec. 9015. Technical corrections regarding title IX.
Sec. 9016. Effective date.
TITLE I--REORGANIZATION OF STRUCTURE AND MANAGEMENT OF THE INTERNAL
REVENUE SERVICE
Subtitle A--Reorganization of the Internal Revenue Service
SEC. 1001. REORGANIZATION OF THE INTERNAL REVENUE SERVICE.
(a) In General.--The Commissioner of Internal Revenue shall
develop and implement a plan to reorganize the Internal
Revenue Service. The plan shall--
(1) supersede any organization or reorganization of the
Internal Revenue Service based on any statute or
reorganization plan applicable on the effective date of this
section;
(2) eliminate or substantially modify the existing
organization of the Internal Revenue Service which is based
on a national, regional, and district structure;
(3) establish organizational units serving particular
groups of taxpayers with similar needs; and
(4) ensure an independent appeals function within the
Internal Revenue Service, including the prohibition in the
plan of ex parte communications between appeals officers and
other Internal Revenue Service employees to the extent that
such communications appear to compromise the independence of
the appeals officers.
(b) Savings Provisions.--
(1) Preservation of specific tax rights and remedies.--
Nothing in the plan developed and implemented under
subsection (a) shall be considered to impair any right or
remedy, including trial by jury, to recover any internal
revenue tax alleged to have been erroneously or illegally
assessed or collected, or any penalty claimed to have been
collected without authority, or any sum alleged to have been
excessive or in any manner wrongfully collected under the
internal revenue laws. For the purpose of any action to
recover any such tax, penalty, or sum, all statutes, rules,
and regulations referring to the collector of internal
revenue, the principal officer for the internal revenue
district, or the Secretary, shall be deemed to refer to the
officer whose act or acts referred to in the preceding
sentence gave rise to such action. The venue of any such
action shall be the same as under existing law.
(2) Continuing effect of legal documents.--All orders,
determinations, rules, regulations, permits, agreements,
grants, contracts, certificates, licenses, registrations,
privileges, and other administrative actions--
(A) which have been issued, made, granted, or allowed to
become effective by the President, any Federal agency or
official thereof, or by a court of competent jurisdiction, in
the performance of any function transferred or affected by
the reorganization of the Internal Revenue Service or any
other administrative unit of the Department of the Treasury
under this section, and
(B) which are in effect at the time this section takes
effect, or were final before the effective date of this
section and are to become effective on or after the effective
date of this section,
shall continue in effect according to their terms until
modified, terminated, superseded, set aside, or revoked in
accordance with law by the President, the Secretary of the
Treasury, the Commissioner of Internal Revenue, or other
authorized official, a court of competent jurisdiction, or by
operation of law.
(3) Proceedings not affected.--The provisions of this
section shall not affect any proceedings, including notices
of proposed rulemaking, or any application for any license,
permit, certificate, or financial assistance pending before
the Department of the Treasury (or any administrative unit of
the Department, including the Internal Revenue Service) at
the time this section takes effect, with respect to functions
transferred or affected by the reorganization under this
section but such proceedings and applications shall continue.
Orders shall be issued in such proceedings, appeals shall be
taken therefrom, and payments shall be made pursuant to such
orders, as if this section had not been enacted, and orders
issued in any such proceedings shall continue in effect until
modified, terminated, superseded, or revoked by a duly
authorized official, by a court of competent jurisdiction, or
by operation of law. Nothing in this paragraph shall be
deemed to prohibit the discontinuance or modification of any
such proceeding under the same terms and conditions and to
the same extent that such proceeding could have been
discontinued or modified if this section had not been
enacted.
(4) Suits not affected.--The provisions of this section
shall not affect suits commenced before the effective date of
this section, and in all such suits, proceedings shall be
had, appeals taken, and judgments rendered in the same manner
and with the same effect as if this section had not been
enacted.
(5) Nonabatement of actions.--No suit, action, or other
proceeding commenced by or against the Department of the
Treasury (or any administrative unit of the Department,
including the Internal Revenue Service), or by or against any
individual in the official capacity of such individual as an
officer of the Department of the Treasury, shall abate by
reason of the enactment of this section.
(6) Administrative actions relating to promulgation of
regulations.--Any administrative action relating to the
preparation or promulgation of a regulation by the Department
of the Treasury (or any administrative unit of the
Department, including the Internal Revenue Service) relating
to a function transferred or affected by the reorganization
under this section may be continued by the Department of the
Treasury through any appropriate administrative unit of the
Department, including the Internal Revenue Service with the
same effect as if this section had not been enacted.
(c) Effective Date.--This section shall take effect on the
date of the enactment of this Act.
SEC. 1002. IRS MISSION TO FOCUS ON TAXPAYERS' NEEDS.
The Internal Revenue Service shall review and restate its
mission to place a greater emphasis on serving the public and
meeting taxpayers' needs.
Subtitle B--Executive Branch Governance and Senior Management
SEC. 1101. INTERNAL REVENUE SERVICE OVERSIGHT BOARD.
(a) In General.--Section 7802 (relating to the Commissioner
of Internal Revenue) is amended to read as follows:
``SEC. 7802. INTERNAL REVENUE SERVICE OVERSIGHT BOARD.
``(a) Establishment.--There is established within the
Department of the Treasury the Internal Revenue Service
Oversight Board (hereafter in this subchapter referred to as
the `Oversight Board').
``(b) Membership.--
``(1) Composition.--The Oversight Board shall be composed
of 9 members, as follows:
``(A) 6 members shall be individuals who are not otherwise
Federal officers or employees and who are appointed by the
President, by and with the advice and consent of the Senate.
``(B) 1 member shall be the Secretary of the Treasury or,
if the Secretary so designates, the Deputy Secretary of the
Treasury.
``(C) 1 member shall be the Commissioner of Internal
Revenue.
``(D) 1 member shall be an individual who is a full-time
Federal employee or a representative of employees and who is
appointed by the President, by and with the advice and
consent of the Senate.
``(2) Qualifications and terms.--
``(A) Qualifications.--Members of the Oversight Board
described in paragraph (1)(A) shall be appointed without
regard to political affiliation and solely on the basis of
their professional experience and expertise in 1 or more of
the following areas:
``(i) Management of large service organizations.
``(ii) Customer service.
``(iii) Federal tax laws, including tax administration and
compliance.
``(iv) Information technology.
``(v) Organization development.
``(vi) The needs and concerns of taxpayers.
``(vii) The needs and concerns of small businesses.
In the aggregate, the members of the Oversight Board
described in paragraph (1)(A) should collectively bring to
bear expertise in all of the areas described in the preceding
sentence.
``(B) Terms.--Each member who is described in subparagraph
(A) or (D) of paragraph (1) shall be appointed for a term of
5 years, except that of the members first appointed under
paragraph (1)(A)--
``(i) 2 members shall be appointed for a term of 3 years,
``(ii) 2 members shall be appointed for a term of 4 years,
and
``(iii) 2 members shall be appointed for a term of 5 years.
``(C) Reappointment.--An individual who is described in
subparagraph (A) or (D) of paragraph (1) may be appointed to
no more than two 5-year terms on the Oversight Board.
``(D) Vacancy.--Any vacancy on the Oversight Board shall be
filled in the same manner as the original appointment. Any
member appointed to fill a vacancy occurring before the
expiration of the term for which the member's predecessor was
appointed shall be appointed for the remainder of that term.
``(3) Ethical considerations.--
``(A) Financial disclosure.--During the entire period that
an individual appointed under subparagraph (A) or (D) of
paragraph (1) is a member of the Oversight Board, such
individual shall be treated as serving as an officer or
employee referred to in section 101(f) of the Ethics in
Government Act of 1978 for purposes of title I of such Act,
except that section 101(d) of such Act shall apply without
regard to the number of days of service in the position.
``(B) Restrictions on post-employment.--For purposes of
section 207(c) of title 18, United States Code, an individual
appointed under subparagraph (A) or (D) of paragraph (1)
shall be treated as an employee referred to in section
207(c)(2)(A)(i) of such title during the entire period the
individual is a member of the Board, except that subsections
(c)(2)(B) and (f) of section 207 of such title shall not
apply.
``(C) Members who are special government employees.--If an
individual appointed under subparagraph (A) or (D) of
paragraph (1) is a special Government employee, the following
additional rules apply for purposes of chapter 11 of title
18, United States Code:
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H5103]]
``(i) Restriction on representation.--In addition to any
restriction under section 205(c) of title 18, United States
Code, except as provided in subsections (d) through (i) of
section 205 of such title, such individual (except in the
proper discharge of official duties) shall not, with or
without compensation, represent anyone to or before any
officer or employee of--
``(I) the Oversight Board or the Internal Revenue Service
on any matter,
``(II) the Department of the Treasury on any matter
involving the internal revenue laws or involving the
management or operations of the Internal Revenue Service,
or
``(III) the Department of Justice with respect to
litigation involving a matter described in subclause (I) or
(II).
``(ii) Compensation for services provided by another.--For
purposes of section 203 of such title--
``(I) such individual shall not be subject to the
restrictions of subsection (a)(1) thereof for sharing in
compensation earned by another for representations on matters
covered by such section, and
``(II) a person shall not be subject to the restrictions of
subsection (a)(2) thereof for sharing such compensation with
such individual.
``(D) Waiver.--The President may, only at the time the
President nominates the member of the Oversight Board
described in paragraph (1)(D), waive for the term of the
member any appropriate provision of chapter 11 of title 18,
United States Code, to the extent such waiver is necessary to
allow such member to participate in the decisions of the
Board while continuing to serve as a full-time Federal
employee or a representative of employees. Any such waiver
shall not be effective unless a written intent of waiver to
exempt such member (and actual waiver language) is submitted
to the Senate with the nomination of such member.
``(4) Quorum.--5 members of the Oversight Board shall
constitute a quorum. A majority of members present and voting
shall be required for the Oversight Board to take action.
``(5) Removal.--
``(A) In general.--Any member of the Oversight Board
appointed under subparagraph (A) or (D) of paragraph (1) may
be removed at the will of the President.
``(B) Secretary and commissioner.--An individual described
in subparagraph (B) or (C) of paragraph (1) shall be removed
upon termination of service in the office described in such
subparagraph.
``(6) Claims.--
``(A) In general.--Members of the Oversight Board who are
described in subparagraph (A) or (D) of paragraph (1) shall
have no personal liability under Federal law with respect to
any claim arising out of or resulting from an act or omission
by such member within the scope of service as a member.
``(B) Effect on other law.--This paragraph shall not be
construed--
``(i) to affect any other immunities and protections that
may be available to such member under applicable law with
respect to such transactions,
``(ii) to affect any other right or remedy against the
United States under applicable law, or
``(iii) to limit or alter in any way the immunities that
are available under applicable law for Federal officers and
employees.
``(c) General Responsibilities.--
``(1) Oversight.--
``(A) In general.--The Oversight Board shall oversee the
Internal Revenue Service in its administration, management,
conduct, direction, and supervision of the execution and
application of the internal revenue laws or related statutes
and tax conventions to which the United States is a party.
``(B) Mission of irs.--As part of its oversight functions
described in subparagraph (A), the Oversight Board shall
ensure that the organization and operation of the Internal
Revenue Service allows it to carry out its mission.
``(C) Confidentiality.--The Oversight Board shall ensure
that appropriate confidentiality is maintained in the
exercise of its duties.
``(2) Exceptions.--The Oversight Board shall have no
responsibilities or authority with respect to--
``(A) the development and formulation of Federal tax policy
relating to existing or proposed internal revenue laws,
related statutes, and tax conventions,
``(B) specific law enforcement activities of the Internal
Revenue Service, including specific compliance activities
such as examinations, collection activities, and criminal
investigations,
``(C) specific procurement activities of the Internal
Revenue Service, or
``(D) except as provided in subsection (d)(3), specific
personnel actions.
``(d) Specific Responsibilities.--The Oversight Board shall
have the following specific responsibilities:
``(1) Strategic plans.--To review and approve strategic
plans of the Internal Revenue Service, including the
establishment of--
``(A) mission and objectives, and standards of performance
relative to either, and
``(B) annual and long-range strategic plans.
``(2) Operational plans.--To review the operational
functions of the Internal Revenue Service, including--
``(A) plans for modernization of the tax system,
``(B) plans for outsourcing or managed competition, and
``(C) plans for training and education.
``(3) Management.--To--
``(A) recommend to the President candidates for appointment
as the Commissioner of Internal Revenue and recommend to the
President the removal of the Commissioner,
``(B) review the Commissioner's selection, evaluation, and
compensation of Internal Revenue Service senior executives
who have program management responsibility over significant
functions of the Internal Revenue Service, and
``(C) review and approve the Commissioner's plans for any
major reorganization of the Internal Revenue Service.
``(4) Budget.--To--
``(A) review and approve the budget request of the Internal
Revenue Service prepared by the Commissioner,
``(B) submit such budget request to the Secretary of the
Treasury, and
``(C) ensure that the budget request supports the annual
and long-range strategic plans.
``(5) Taxpayer protection.--To ensure the proper treatment
of taxpayers by the employees of the Internal Revenue
Service.
The Secretary shall submit the budget request referred to in
paragraph (4)(B) for any fiscal year to the President who
shall submit such request, without revision, to Congress
together with the President's annual budget request for the
Internal Revenue Service for such fiscal year.
``(e) Board Personnel Matters.--
``(1) Compensation of members.--
``(A) In general.--Each member of the Oversight Board who--
``(i) is described in subsection (b)(1)(A), or
``(ii) is described in subsection (b)(1)(D) and is not
otherwise a Federal officer or employee,
shall be compensated at a rate of $30,000 per year. All other
members shall serve without compensation for such service.
``(B) Chairperson.--In lieu of the amount specified in
subparagraph (A), the Chairperson of the Oversight Board
shall be compensated at a rate of $50,000 per year.
``(2) Travel expenses.--
``(A) In general.--The members of the Oversight Board shall
be allowed travel expenses, including per diem in lieu of
subsistence, at rates authorized for employees of agencies
under subchapter I of chapter 57 of title 5, United States
Code, to attend meetings of the Oversight Board and, with the
advance approval of the Chairperson of the Oversight Board,
while otherwise away from their homes or regular places of
business for purposes of duties as a member of the Oversight
Board.
``(B) Report.--The Oversight Board shall include in its
annual report under subsection (f)(3)(A) information with
respect to the travel expenses allowed for members of the
Oversight Board under this paragraph.
``(3) Staff.--
``(A) In general.--The Chairperson of the Oversight Board
may appoint and terminate any personnel that may be necessary
to enable the Board to perform its duties.
``(B) Detail of government employees.--Upon request of the
Chairperson of the Oversight Board, a Federal agency shall
detail a Federal Government employee to the Oversight Board
without reimbursement. Such detail shall be without
interruption or loss of civil service status or privilege.
``(4) Procurement of temporary and intermittent services.--
The Chairperson of the Oversight Board may procure temporary
and intermittent services under section 3109(b) of title 5,
United States Code.
``(f) Administrative Matters.--
``(1) Chair.--
``(A) Term.--The members of the Oversight Board shall elect
for a 2-year term a chairperson from among the members
appointed under subsection (b)(1)(A).
``(B) Powers.--Except as otherwise provided by a majority
vote of the Oversight Board, the powers of the Chairperson
shall include--
``(i) establishing committees,
``(ii) setting meeting places and times,
``(iii) establishing meeting agendas, and
``(iv) developing rules for the conduct of business.
``(2) Meetings.--The Oversight Board shall meet at least
quarterly and at such other times as the Chairperson
determines appropriate.
``(3) Reports.--
``(A) Annual.--The Oversight Board shall each year report
with respect to the conduct of its responsibilities under
this title to the President, the Committees on Ways and
Means, Government Reform and Oversight, and Appropriations of
the House of Representatives and the Committees on Finance,
Governmental Affairs, and Appropriations of the Senate.
``(B) Additional report.--Upon a determination by the
Oversight Board under subsection (c)(1)(B) that the
organization and operation of the Internal Revenue Service
are not allowing it to carry out its mission, the Oversight
Board shall report such determination to the Committee on
Ways and Means of the House of Representatives and the
Committee on Finance of the Senate.''.
(b) Restriction on Disclosure of Return Information to
Oversight Board Members.--Section 6103(h) (relating to
disclosure to certain Federal officers and employees for
purposes of tax administration, etc.) is amended by adding at
the end the following new paragraph:
``(5) Internal revenue service oversight board.--
``(A) In general.--Notwithstanding paragraph (1), and
except as provided in subparagraph (B), no return or return
information may be disclosed to any member of the Oversight
Board described in subparagraph (A) or (D) of section
7802(b)(1) or to any employee or detailee of such Board by
reason of their service with the Board. Any request for
information not permitted to be disclosed under the
preceding sentence, and any contact relating to a specific
taxpayer, made by any such individual to an officer or
employee of the Internal Revenue Service shall be reported
by such officer or employee to the Secretary, the Treasury
Inspector General for Tax Administration, and the Joint
Committee on Taxation.
[[Page
H5104]]
``(B) Exception for reports to the board.--If--
``(i) the Commissioner or the Treasury Inspector General
for Tax Administration prepares any report or other matter
for the Oversight Board in order to assist the Board in
carrying out its duties, and
``(ii) the Commissioner or such Inspector General
determines it is necessary to include any return or return
information in such report or other matter to enable the
Board to carry out such duties,
such return or return information (other than information
regarding taxpayer identity) may be disclosed to members,
employees, or detailees of the Board solely for the purpose
of carrying out such duties.''.
(c) Conforming Amendments.--
(1) Section 4946(c) (relating to definitions and special
rules for chapter 42) is amended by striking ``or'' at the
end of paragraph (5), by striking the period at the end of
paragraph (6) and inserting ``, or'', and by adding at the
end the following new paragraph:
``(7) a member of the Internal Revenue Service Oversight
Board.''.
(2) The table of sections for subchapter A of chapter 80 is
amended by striking the item relating to section 7802 and
inserting the following new item:
``Sec. 7802. Internal Revenue Service Oversight Board.''.
(d) Effective Date.--
(1) In general.--The amendments made by this section shall
take effect on the date of the enactment of this Act.
(2) Initial nominations to internal revenue service
oversight board.--The President shall submit the initial
nominations under section 7802 of the Internal Revenue Code
of 1986, as added by this section, to the Senate not later
than 6 months after the date of the enactment of this Act.
(3) Effect on actions prior to appointment of oversight
board.--Nothing in this section shall be construed to
invalidate the actions and authority of the Internal Revenue
Service prior to the appointment of the members of the
Internal Revenue Service Oversight Board.
SEC. 1102. COMMISSIONER OF INTERNAL REVENUE; OTHER OFFICIALS.
(a) In General.--Section 7803 (relating to other personnel)
is amended to read as follows:
``SEC. 7803. COMMISSIONER OF INTERNAL REVENUE; OTHER
OFFICIALS.
``(a) Commissioner of Internal Revenue.--
``(1) Appointment.--
``(A) In general.--There shall be in the Department of the
Treasury a Commissioner of Internal Revenue who shall be
appointed by the President, by and with the advice and
consent of the Senate, to a 5-year term. Such appointment
shall be made from individuals who, among other
qualifications, have a demonstrated ability in management.
``(B) Vacancy.--Any individual appointed to fill a vacancy
in the position of Commissioner occurring before the
expiration of the term for which such individual's
predecessor was appointed shall be appointed only for the
remainder of that term.
``(C) Removal.--The Commissioner may be removed at the will
of the President.
``(D) Reappointment.--The Commissioner may be appointed to
more than one 5-year term.
``(2) Duties.--The Commissioner shall have such duties and
powers as the Secretary may prescribe, including the power
to--
``(A) administer, manage, conduct, direct, and supervise
the execution and application of the internal revenue laws or
related statutes and tax conventions to which the United
States is a party, and
``(B) recommend to the President a candidate for
appointment as Chief Counsel for the Internal Revenue Service
when a vacancy occurs, and recommend to the President the
removal of such Chief Counsel.
If the Secretary determines not to delegate a power specified
in subparagraph (A) or (B), such determination may not take
effect until 30 days after the Secretary notifies the
Committees on Ways and Means, Government Reform and
Oversight, and Appropriations of the House of Representatives
and the Committees on Finance, Governmental Affairs, and
Appropriations of the Senate.
``(3) Consultation with board.--The Commissioner shall
consult with the Oversight Board on all matters set forth in
paragraphs (2) and (3) (other than paragraph (3)(A)) of
section 7802(d).
``(b) Chief Counsel for the Internal Revenue Service.--
``(1) Appointment.--There shall be in the Department of the
Treasury a Chief Counsel for the Internal Revenue Service who
shall be appointed by the President, by and with the consent
of the Senate.
``(2) Duties.--The Chief Counsel shall be the chief law
officer for the Internal Revenue Service and shall perform
such duties as may be prescribed by the Secretary, including
the duty--
``(A) to be legal advisor to the Commissioner and the
Commissioner's officers and employees,
``(B) to furnish legal opinions for the preparation and
review of rulings and memoranda of technical advice,
``(C) to prepare, review, and assist in the preparation of
proposed legislation, treaties, regulations, and Executive
orders relating to laws which affect the Internal Revenue
Service,
``(D) to represent the Commissioner in cases before the Tax
Court, and
``(E) to determine which civil actions should be litigated
under the laws relating to the Internal Revenue Service and
prepare recommendations for the Department of Justice
regarding the commencement of such actions.
If the Secretary determines not to delegate a power specified
in subparagraph (A), (B), (C), (D), or (E), such
determination may not take effect until 30 days after the
Secretary notifies the Committees on Ways and Means,
Government Reform and Oversight, and Appropriations of the
House of Representatives and the Committees on Finance,
Governmental Affairs, and Appropriations of the Senate.
``(3) Persons to whom chief counsel reports.--The Chief
Counsel shall report directly to the Commissioner of Internal
Revenue, except that--
``(A) the Chief Counsel shall report to both the
Commissioner and the General Counsel for the Department of
the Treasury with respect to--
``(i) legal advice or interpretation of the tax law not
relating solely to tax policy, and
``(ii) tax litigation, and
``(B) the Chief Counsel shall report to the General Counsel
with respect to legal advice or interpretation of the tax law
relating solely to tax policy.
If there is any disagreement between the Commissioner and the
General Counsel with respect to any matter jointly referred
to them under subparagraph (A), such matter shall be
submitted to the Secretary or Deputy Secretary for
resolution.
``(4) Chief counsel personnel.--All personnel in the Office
of Chief Counsel shall report to the Chief Counsel.
``(c) Office of the Taxpayer Advocate.--
``(1) Establishment.--
``(A) In general.--There is established in the Internal
Revenue Service an office to be known as the `Office of the
Taxpayer Advocate'.
``(B) National taxpayer advocate.--
``(i) In general.--The Office of the Taxpayer Advocate
shall be under the supervision and direction of an official
to be known as the `National Taxpayer Advocate'. The National
Taxpayer Advocate shall report directly to the Commissioner
of Internal Revenue and shall be entitled to compensation at
the same rate as the highest rate of basic pay established
for the Senior Executive Service under section 5382 of title
5, United States Code, or, if the Secretary of the Treasury
so determines, at a rate fixed under section 9503 of such
title.
``(ii) Appointment.--The National Taxpayer Advocate shall
be appointed by the Secretary of the Treasury after
consultation with the Commissioner of Internal Revenue and
the Oversight Board and without regard to the provisions of
title 5, United States Code, relating to appointments in the
competitive service or the Senior Executive Service.
``(iii) Qualifications.--An individual appointed under
clause (ii) shall have--
``(I) a background in customer service as well as tax law,
and
``(II) experience in representing individual taxpayers.
``(iv) Restriction on employment.--An individual may be
appointed as the National Taxpayer Advocate only if such
individual was not an officer or employee of the Internal
Revenue Service during the 2-year period ending with such
appointment and such individual agrees not to accept any
employment with the Internal Revenue Service for at least 5
years after ceasing to be the National Taxpayer Advocate.
Service as an officer or employee of the Office of the
Taxpayer Advocate shall not be taken into account in applying
this clause.
``(2) Functions of office.--
``(A) In general.--It shall be the function of the Office
of the Taxpayer Advocate to--
``(i) assist taxpayers in resolving problems with the
Internal Revenue Service,
``(ii) identify areas in which taxpayers have problems in
dealings with the Internal Revenue Service,
``(iii) to the extent possible, propose changes in the
administrative practices of the Internal Revenue Service to
mitigate problems identified under clause (ii), and
``(iv) identify potential legislative changes which may be
appropriate to mitigate such problems.
``(B) Annual reports.--
``(i) Objectives.--Not later than June 30 of each calendar
year, the National Taxpayer Advocate shall report to the
Committee on Ways and Means of the House of Representatives
and the Committee on Finance of the Senate on the objectives
of the Office of the Taxpayer Advocate for the fiscal year
beginning in such calendar year. Any such report shall
contain full and substantive analysis, in addition to
statistical information.
``(ii) Activities.--Not later than December 31 of each
calendar year, the National Taxpayer Advocate shall report to
the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the Senate on
the activities of the Office of the Taxpayer Advocate during
the fiscal year ending during such calendar year. Any such
report shall contain full and substantive analysis, in
addition to statistical information, and shall--
``(I) identify the initiatives the Office of the Taxpayer
Advocate has taken on improving taxpayer services and
Internal Revenue Service responsiveness,
``(II) contain recommendations received from individuals
with the authority to issue Taxpayer Assistance Orders under
section 7811,
``(III) contain a summary of at least 20 of the most
serious problems encountered by taxpayers, including
a description of the nature of such problems,
``(IV) contain an inventory of the items described in
subclauses (I), (II), and (III) for which action has been
taken and the result of such action,
``(V) contain an inventory of the items described in
subclauses (I), (II), and (III) for which action remains to
be completed and the period during which each item has
remained on such inventory,
[[Page
H5105]]
``(VI) contain an inventory of the items described in
subclauses (I), (II), and (III) for which no action has been
taken, the period during which each item has remained on such
inventory, the reasons for the inaction, and identify any
Internal Revenue Service official who is responsible for such
inaction,
``(VII) identify any Taxpayer Assistance Order which was
not honored by the Internal Revenue Service in a timely
manner, as specified under section 7811(b),
``(VIII) contain recommendations for such administrative
and legislative action as may be appropriate to resolve
problems encountered by taxpayers,
``(IX) identify areas of the tax law that impose
significant compliance burdens on taxpayers or the Internal
Revenue Service, including specific recommendations for
remedying these problems,
``(X) identify the 10 most litigated issues for each
category of taxpayers, including recommendations for
mitigating such disputes, and
``(XI) include such other information as the National
Taxpayer Advocate may deem advisable.
``(iii) Report to be submitted directly.--Each report
required under this subparagraph shall be provided directly
to the committees described in clause (i) without any prior
review or comment from the Commissioner, the Secretary of the
Treasury, the Oversight Board, any other officer or employee
of the Department of the Treasury, or the Office of
Management and Budget.
``(iv) Coordination with report of treasury inspector
general for tax administration.--To the extent that
information required to be reported under clause (ii) is also
required to be reported under paragraph (1) or (2) of
subsection (d) by the Treasury Inspector General for Tax
Administration, the National Taxpayer Advocate shall not
contain such information in the report submitted under such
clause.
``(C) Other responsibilities.--The National Taxpayer
Advocate shall--
``(i) monitor the coverage and geographic allocation of
local offices of taxpayer advocates,
``(ii) develop guidance to be distributed to all Internal
Revenue Service officers and employees outlining the criteria
for referral of taxpayer inquiries to local offices of
taxpayer advocates,
``(iii) ensure that the local telephone number for each
local office of the taxpayer advocate is published and
available to taxpayers served by the office, and
``(iv) in conjunction with the Commissioner, develop career
paths for local taxpayer advocates choosing to make a career
in the Office of the Taxpayer Advocate.
``(D) Personnel actions.--
``(i) In general.--The National Taxpayer Advocate shall
have the responsibility and authority to--
``(I) appoint local taxpayer advocates and make available
at least 1 such advocate for each State, and
``(II) evaluate and take personnel actions (including
dismissal) with respect to any employee of any local office
of a taxpayer advocate described in subclause (I).
``(ii) Consultation.--The National Taxpayer Advocate may
consult with the appropriate supervisory personnel of the
Internal Revenue Service in carrying out the National
Taxpayer Advocate's responsibilities under this subparagraph.
``(3) Responsibilities of commissioner.--The Commissioner
shall establish procedures requiring a formal response to all
recommendations submitted to the Commissioner by the National
Taxpayer Advocate within 3 months after submission to the
Commissioner.
``(4) Operation of local offices.--
``(A) In general.--Each local taxpayer advocate--
``(i) shall report to the National Taxpayer Advocate or
delegate thereof,
``(ii) may consult with the appropriate supervisory
personnel of the Internal Revenue Service regarding the daily
operation of the local office of the taxpayer advocate,
``(iii) shall, at the initial meeting with any taxpayer
seeking the assistance of a local office of the taxpayer
advocate, notify such taxpayer that the taxpayer advocate
offices operate independently of any other Internal Revenue
Service office and report directly to Congress through the
National Taxpayer Advocate, and
``(iv) may, at the taxpayer advocate's discretion, not
disclose to the Internal Revenue Service contact with, or
information provided by, such taxpayer.
``(B) Maintenance of independent communications.--Each
local office of the taxpayer advocate shall maintain a
separate phone, facsimile, and other electronic communication
access, and a separate post office address.
``(d) Additional Duties of the Treasury Inspector General
for Tax Administration.--
``(1) Annual reporting.--The Treasury Inspector General for
Tax Administration shall include in one of the semiannual
reports under section 5 of the Inspector General Act of
1978--
``(A) an evaluation of the compliance of the Internal
Revenue Service with--
``(i) restrictions under section 1204 of the Internal
Revenue Service Restructuring and Reform Act of 1998 on the
use of enforcement statistics to evaluate Internal Revenue
Service employees,
``(ii) restrictions under section 7521 on directly
contacting taxpayers who have indicated that they prefer
their representatives be contacted,
``(iii) required procedures under section 6320 upon the
filing of a notice of a lien,
``(iv) required procedures under subchapter D of chapter 64
for seizure of property for collection of taxes, including
required procedures under section 6330 regarding levies, and
``(v) restrictions under section 3707 of the Internal
Revenue Service Restructuring and Reform Act of 1998 on
designation of taxpayers,
``(B) a review and a certification of whether or not the
Secretary is complying with the requirements of section
6103(e)(8) to disclose information to an individual filing a
joint return on collection activity involving the other
individual filing the return,
``(C) information regarding extensions of the statute of
limitations for assessment and collection of tax under
section 6501 and the provision of notice to taxpayers
regarding requests for such extension,
``(D) an evaluation of the adequacy and security of the
technology of the Internal Revenue Service,
``(E) any termination or mitigation under section 1203 of
the Internal Revenue Service Restructuring and Reform Act of
1998,
``(F) information regarding improper denial of requests for
information from the Internal Revenue Service identified
under paragraph (3)(A), and
``(G) information regarding any administrative or civil
actions with respect to violations of the fair debt
collection provisions of section 6304, including--
``(i) a summary of such actions initiated since the date of
the last report, and
``(ii) a summary of any judgments or awards granted as a
result of such actions.
``(2) Semiannual reports.--
``(A) In general.--The Treasury Inspector General for Tax
Administration shall include in each semiannual report under
section 5 of the Inspector General Act of 1978--
``(i) the number of taxpayer complaints during the
reporting period;
``(ii) the number of employee misconduct and taxpayer abuse
allegations received by the Internal Revenue Service or the
Inspector General during the period from taxpayers, Internal
Revenue Service employees, and other sources;
``(iii) a summary of the status of such complaints and
allegations; and
``(iv) a summary of the disposition of such complaints and
allegations, including the outcome of any Department of
Justice action and any monies paid as a settlement of such
complaints and allegations.
``(B) Clauses (iii) and (iv) of subparagraph (A) shall only
apply to complaints and allegations of serious employee
misconduct.
``(3) Other responsibilities.--The Treasury Inspector
General for Tax Administration shall--
``(A) conduct periodic audits of a statistically valid
sample of the total number of determinations made by the
Internal Revenue Service to deny written requests to disclose
information to taxpayers on the basis of section 6103 of this
title or section 552(b)(7) of title 5, United States Code,
and
``(B) establish and maintain a toll-free telephone number
for taxpayers to use to confidentially register complaints of
misconduct by Internal Revenue Service employees and
incorporate the telephone number in the statement required by
section 6227 of the Omnibus Taxpayer Bill of Rights (Internal
Revenue Service Publication No. 1).''.
(b) Notice of Right To Contact Office Included in Notice of
Deficiency.--Section 6212(a) (relating to notice of
deficiency) is amended by adding at the end the following new
sentence: ``Such notice shall include a notice to the
taxpayer of the taxpayer's right to contact a local office of
the taxpayer advocate and the location and phone number of
the appropriate office.''.
(c) Expansion of Authority To Issue Taxpayer Assistance
Orders.--Section 7811(a) (relating to taxpayer assistance
orders) is amended to read as follows:
``(a) Authority To Issue.--
``(1) In general.--Upon application filed by a taxpayer
with the Office of the Taxpayer Advocate (in such form,
manner, and at such time as the Secretary shall by
regulations prescribe), the National Taxpayer Advocate may
issue a Taxpayer Assistance Order if--
``(A) the National Taxpayer Advocate determines the
taxpayer is suffering or about to suffer a significant
hardship as a result of the manner in which the internal
revenue laws are being administered by the Secretary, or
``(B) the taxpayer meets such other requirements as are set
forth in regulations prescribed by the Secretary.
``(2) Determination of hardship.--For purposes of paragraph
(1), a significant hardship shall include--
``(A) an immediate threat of adverse action,
``(B) a delay of more than 30 days in resolving taxpayer
account problems,
``(C) the incurring by the taxpayer of significant costs
(including fees for professional representation) if relief is
not granted, or
``(D) irreparable injury to, or a long-term adverse impact
on, the taxpayer if relief is not granted.
``(3) Standard where administrative guidance not
followed.--In cases where any Internal Revenue Service
employee is not following applicable published administrative
guidance (including the Internal Revenue Manual), the
National Taxpayer Advocate shall construe the factors taken
into account in determining whether to issue a taxpayer
assistance order in the manner most favorable to the
taxpayer.''.
(d) Conforming Amendments Relating to National Taxpayer
Advocate.--
(1) The following provisions are each amended by striking
``Taxpayer Advocate'' each place it appears and inserting
``National Taxpayer Advocate'':
(A) Section 6323(j)(1)(D) (relating to withdrawal of notice
in certain circumstances).
(B) Section 6343(d)(2)(D) (relating to return of property
in certain cases).
(C) Section 7811(b)(2)(D) (relating to terms of a Taxpayer
Assistance Order).
(D) Section 7811(c) (relating to authority to modify or
rescind).
[[Page
H5106]]
(E) Section 7811(d)(2) (relating to suspension of running
of period of limitation).
(F) Section 7811(e) (relating to independent action of
Taxpayer Advocate).
(G) Section 7811(f) (relating to Taxpayer Advocate).
(2) Section 7811(d)(1) (relating to suspension of running
of period of limitation) is amended by striking ``Taxpayer
Advocate's'' and inserting ``National Taxpayer Advocate's''.
(3) The headings of subsections (e) and (f) of section 7811
are each amended by striking ``Taxpayer Advocate'' and
inserting ``National Taxpayer Advocate''.
(e) Additional Conforming Amendments.--
(1) The table of sections for subchapter A of chapter 80 is
amended by striking the item relating to section 7803 and
inserting the following new item:
``Sec. 7803. Commissioner of Internal Revenue; other officials.''.
(2) Section 5109 of title 5, United States Code, is amended
by striking subsection (b) and redesignating subsection (c)
as subsection (b).
(3) Section 7611(f)(1) (relating to restrictions on church
tax inquiries and examinations) is amended by striking
``Assistant Commissioner for Employee Plans and Exempt
Organizations of the Internal Revenue Service'' and inserting
``Secretary''.
(f) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall take effect on the date
of the enactment of this Act.
(2) Chief counsel.--Section 7803(b)(3) of the Internal
Revenue Code of 1986, as added by this section, shall take
effect on the date that is 90 days after the date of the
enactment of this Act.
(3) National taxpayer advocate.--Notwithstanding section
7803(c)(1)(B)(iv) of such Code, as added by this section, in
appointing the first National Taxpayer Advocate after the
date of the enactment of this Act, the Secretary of the
Treasury--
(A) shall not appoint any individual who was an officer or
employee of the Internal Revenue Service at any time during
the 2-year period ending on the date of appointment, and
(B) need not consult with the Internal Revenue Service
Oversight Board if the Oversight Board has not been
appointed.
(4) Current officers.--
(A) In the case of an individual serving as Commissioner of
Internal Revenue on the date of the enactment of this Act who
was appointed to such position before such date, the 5-year
term required by section 7803(a)(1) of such Code, as added by
this section, shall begin as of the date of such appointment.
(B) Clauses (ii), (iii), and (iv) of section 7803(c)(1)(B)
of such Code,
Major Actions:
All articles in House section
CONFERENCE REPORT ON H.R. 2676, INTERNAL REVENUE SERVICE RESTRUCTURING AND REFORM ACT OF 1998
(House of Representatives - June 24, 1998)
Text of this article available as:
TXT
PDF
[Pages
H5100-H5195]
CONFERENCE REPORT ON
H.R. 2676, INTERNAL REVENUE SERVICE RESTRUCTURING
AND REFORM ACT OF 1998
Mr. ARCHER submitted the following conference report and statement on
the bill (
H.R. 2676) to amend the Internal Revenue Code of 1986 to
restructure and reform the Internal Revenue Service, and for other
purposes:
Conference Report (H. Rept. 105-599)
The committee of conference on the disagreeing votes of the
two Houses on the amendment of the Senate to the bill (
H.R.
2676) to amend the Internal Revenue Code of 1986 to
restructure and reform the Internal Revenue Service, and for
other purposes, having met, after full and free conference,
have agreed to recommend and do recommend to their respective
Houses as follows:
That the House recede from its disagreement to the
amendment of the Senate, and agree to the same with an
amendment, as follows:
In lieu of the matter stricken and inserted by said
amendment, insert:
SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE; WAIVER OF
ESTIMATED TAX PENALTIES; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Internal
Revenue Service Restructuring and Reform Act of 1998''.
(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) Waiver of Estimated Tax Penalties.--No addition to tax
shall be made under section 6654 or 6655 of the Internal
Revenue Code of 1986 with respect to any underpayment of an
installment required to be paid on or before the 30th day
after the date of the enactment of this Act to the extent
such underpayment was created or increased by any provision
of this Act.
(d) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; amendment of 1986 Code; waiver of estimated tax
penalties; table of contents.
TITLE I--REORGANIZATION OF STRUCTURE AND MANAGEMENT OF THE INTERNAL
REVENUE SERVICE
Subtitle A--Reorganization of the Internal Revenue Service
Sec. 1001. Reorganization of the internal revenue service.
Sec. 1002. IRS mission to focus on taxpayers' needs.
Subtitle B--Executive Branch Governance and Senior Management
Sec. 1101. Internal Revenue Service Oversight Board.
Sec. 1102. Commissioner of Internal Revenue; other officials.
Sec. 1103. Treasury Inspector General for Tax Administration.
Sec. 1104. Other personnel.
Sec. 1105. Prohibition on executive branch influence over taxpayer
audits and other investigations.
Subtitle C--Personnel Flexibilities
Sec. 1201. Improvements in personnel flexibilities.
Sec. 1202. Voluntary separation incentive payments.
Sec. 1203. Termination of employment for misconduct.
Sec. 1204. Basis for evaluation of Internal Revenue Service employees.
Sec. 1205. Employee training program.
TITLE II--ELECTRONIC FILING
Sec. 2001. Electronic filing of tax and information returns.
Sec. 2002. Due date for certain information returns.
Sec. 2003. Paperless electronic filing.
[[Page
H5101]]
Sec. 2004. Return-free tax system.
Sec. 2005. Access to account information.
TITLE III--TAXPAYER PROTECTION AND RIGHTS
Sec. 3000. Short title.
Subtitle A--Burden of Proof
Sec. 3001. Burden of proof.
Subtitle B--Proceedings by Taxpayers
Sec. 3101. Expansion of authority to award costs and certain fees.
Sec. 3102. Civil damages for collection actions.
Sec. 3103. Increase in size of cases permitted on small case calendar.
Sec. 3104. Actions for refund with respect to certain estates which
have elected the installment method of payment.
Sec. 3105. Administrative appeal of adverse IRS determination of tax-
exempt status of bond issue.
Sec. 3106. Civil action for release of erroneous lien.
Subtitle C--Relief for Innocent Spouses and for Taxpayers Unable To
Manage Their Financial Affairs Due to Disabilities
Sec. 3201. Relief from joint and several liability on joint return.
Sec. 3202. Suspension of statute of limitations on filing refund claims
during periods of disability.
Subtitle D--Provisions Relating to Interest and Penalties
Sec. 3301. Elimination of interest rate differential on overlapping
periods of interest on tax overpayments and
underpayments.
Sec. 3302. Increase in overpayment rate payable to taxpayers other than
corporations.
Sec. 3303. Mitigation of penalty on individual's failure to pay for
months during period of installment agreement.
Sec. 3304. Mitigation of failure to deposit penalty.
Sec. 3305. Suspension of interest and certain penalties where Secretary
fails to contact individual taxpayer.
Sec. 3306. Procedural requirements for imposition of penalties and
additions to tax.
Sec. 3307. Personal delivery of notice of penalty under section 6672.
Sec. 3308. Notice of interest charges.
Sec. 3309. Abatement of interest on underpayments by taxpayers in
Presidentially declared disaster areas.
Subtitle E--Protections for Taxpayers Subject to Audit or Collection
Activities
Part I--Due Process
Sec. 3401. Due process in IRS collection actions.
Part II--Examination Activities
Sec. 3411. Confidentiality privileges relating to taxpayer
communications.
Sec. 3412. Limitation on financial status audit techniques.
Sec. 3413. Software trade secrets protection.
Sec. 3414. Threat of audit prohibited to coerce tip reporting
alternative commitment agreements.
Sec. 3415. Taxpayers allowed motion to quash all third-party summonses.
Sec. 3416. Service of summonses to third-party recordkeepers permitted
by mail.
Sec. 3417. Notice of IRS contact of third parties.
Part III--Collection Activities
SUBPART A--APPROVAL PROCESS
Sec. 3421. Approval process for liens, levies, and seizures.
SUBPART B--LIENS AND LEVIES
Sec. 3431. Modifications to certain levy exemption amounts.
Sec. 3432. Release of levy upon agreement that amount is uncollectible.
Sec. 3433. Levy prohibited during pendency of refund proceedings.
Sec. 3434. Approval required for jeopardy and termination assessments
and jeopardy levies.
Sec. 3435. Increase in amount of certain property on which lien not
valid.
Sec. 3436. Waiver of early withdrawal tax for IRS levies on employer-
sponsored retirement plans or IRAs.
SUBPART C--SEIZURES
Sec. 3441. Prohibition of sales of seized property at less than minimum
bid.
Sec. 3442. Accounting of sales of seized property.
Sec. 3443. Uniform asset disposal mechanism.
Sec. 3444. Codification of IRS administrative procedures for seizure of
taxpayer's property.
Sec. 3445. Procedures for seizure of residences and businesses.
Part IV--Provisions Relating to Examination and Collection Activities
Sec. 3461. Procedures relating to extensions of statute of limitations
by agreement.
Sec. 3462. Offers-in-compromise.
Sec. 3463. Notice of deficiency to specify deadlines for filing Tax
Court petition.
Sec. 3464. Refund or credit of overpayments before final determination.
Sec. 3465. IRS procedures relating to appeals of examinations and
collections.
Sec. 3466. Application of certain fair debt collection procedures.
Sec. 3467. Guaranteed availability of installment agreements.
Sec. 3468. Prohibition on requests to taxpayers to give up rights to
bring actions.
Subtitle F--Disclosures to Taxpayers
Sec. 3501. Explanation of joint and several liability.
Sec. 3502. Explanation of taxpayers' rights in interviews with the
Internal Revenue Service.
Sec. 3503. Disclosure of criteria for examination selection.
Sec. 3504. Explanations of appeals and collection process.
Sec. 3505. Explanation of reason for refund disallowance.
Sec. 3506. Statements regarding installment agreements.
Sec. 3507. Notification of change in tax matters partner.
Sec. 3508. Disclosure to taxpayers.
Sec. 3509. Disclosure of Chief Counsel advice.
Subtitle G--Low Income Taxpayer Clinics
Sec. 3601. Low income taxpayer clinics.
Subtitle H--Other Matters
Sec. 3701. Cataloging complaints.
Sec. 3702. Archive of records of Internal Revenue Service.
Sec. 3703. Payment of taxes.
Sec. 3704. Clarification of authority of Secretary relating to the
making of elections.
Sec. 3705. IRS employee contacts.
Sec. 3706. Use of pseudonyms by IRS employees.
Sec. 3707. Illegal tax protester designation.
Sec. 3708. Provision of confidential information to Congress by
whistleblowers.
Sec. 3709. Listing of local IRS telephone numbers and addresses.
Sec. 3710. Identification of return preparers.
Sec. 3711. Offset of past-due, legally enforceable State income tax
obligations against overpayments.
Sec. 3712. Reporting requirements in connection with education tax
credit.
Subtitle I--Studies
Sec. 3801. Administration of penalties and interest.
Sec. 3802. Confidentiality of tax return information.
Sec. 3803. Study of noncompliance with internal revenue laws by
taxpayers.
Sec. 3804. Study of payments made for detection of underpayments and
fraud.
TITLE IV--CONGRESSIONAL ACCOUNTABILITY FOR THE INTERNAL REVENUE SERVICE
Subtitle A--Oversight
Sec. 4001. Expansion of duties of the Joint Committee on Taxation.
Sec. 4002. Coordinated oversight reports.
Subtitle B--Century Date Change
Sec. 4011. Century date change.
Subtitle C--Tax Law Complexity
Sec. 4021. Role of the Internal Revenue Service.
Sec. 4022. Tax law complexity analysis.
TITLE V--ADDITIONAL PROVISIONS
Sec. 5001. Lower capital gains rates to apply to property held more
than 1 year.
Sec. 5002. Clarification of exclusion of meals for certain employees.
Sec. 5003. Clarification of designation of normal trade relations.
TITLE VI--TECHNICAL CORRECTIONS
Sec. 6001. Short title; coordination with other titles.
Sec. 6002. Definitions.
Sec. 6003. Amendments related to title I of 1997 Act.
Sec. 6004. Amendments related to title II of 1997 Act.
Sec. 6005. Amendments related to title III of 1997 Act.
Sec. 6006. Amendment related to title IV of 1997 Act.
Sec. 6007. Amendments related to title V of 1997 Act.
Sec. 6008. Amendments related to title VII of 1997 Act.
Sec. 6009. Amendments related to title IX of 1997 Act.
Sec. 6010. Amendments related to title X of 1997 Act.
Sec. 6011. Amendments related to title XI of 1997 Act.
Sec. 6012. Amendments related to title XII of 1997 Act.
Sec. 6013. Amendments related to title XIII of 1997 Act.
Sec. 6014. Amendments related to title XIV of 1997 Act.
Sec. 6015. Amendments related to title XV of 1997 Act.
Sec. 6016. Amendments related to title XVI of 1997 Act.
Sec. 6017. Amendment related to Transportation Equity Act for the 21st
Century.
Sec. 6018. Amendments related to Small Business Job Protection Act of
1996.
Sec. 6019. Amendments related to Taxpayer Bill of Rights 2.
Sec. 6020. Amendment related to Omnibus Budget Reconciliation Act of
1993.
Sec. 6021. Amendment related to Revenue Reconciliation Act of 1990.
Sec. 6022. Amendment related to Tax Reform Act of 1986.
Sec. 6023. Miscellaneous clerical and deadwood changes.
Sec. 6024. Effective date.
TITLE VII--REVENUE PROVISIONS
Sec. 7001. Clarification of deduction for deferred compensation.
Sec. 7002. Termination of exception for certain real estate investment
trusts from the treatment of stapled entities.
Sec. 7003. Certain customer receivables ineligible for mark-to-market
treatment.
Sec. 7004. Modification of AGI limit for conversions to Roth IRAs.
TITLE VIII--IDENTIFICATION OF LIMITED TAX BENEFITS SUBJECT TO LINE ITEM
VETO
Sec. 8001. Identification of limited tax benefits subject to line item
veto.
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TITLE IX--TECHNICAL CORRECTIONS TO TRANSPORTATION EQUITY ACT FOR THE
21ST CENTURY
Sec. 9001. Short title.
Sec. 9002. Authorization and program subtitle.
Sec. 9003. Restorations to general provisions subtitle.
Sec. 9004. Restorations to program streamlining and flexibility
subtitle.
Sec. 9005. Restorations to safety subtitle.
Sec. 9006. Elimination of duplicate provisions.
Sec. 9007. Highway finance.
Sec. 9008. High priority projects technical corrections.
Sec. 9009. Federal Transit Administration programs.
Sec. 9010. Motor carrier safety technical correction.
Sec. 9011. Restorations to research title.
Sec. 9012. Automobile safety and information.
Sec. 9013. Technical corrections regarding subtitle A of title VIII.
Sec. 9014. Corrections to veterans subtitle.
Sec. 9015. Technical corrections regarding title IX.
Sec. 9016. Effective date.
TITLE I--REORGANIZATION OF STRUCTURE AND MANAGEMENT OF THE INTERNAL
REVENUE SERVICE
Subtitle A--Reorganization of the Internal Revenue Service
SEC. 1001. REORGANIZATION OF THE INTERNAL REVENUE SERVICE.
(a) In General.--The Commissioner of Internal Revenue shall
develop and implement a plan to reorganize the Internal
Revenue Service. The plan shall--
(1) supersede any organization or reorganization of the
Internal Revenue Service based on any statute or
reorganization plan applicable on the effective date of this
section;
(2) eliminate or substantially modify the existing
organization of the Internal Revenue Service which is based
on a national, regional, and district structure;
(3) establish organizational units serving particular
groups of taxpayers with similar needs; and
(4) ensure an independent appeals function within the
Internal Revenue Service, including the prohibition in the
plan of ex parte communications between appeals officers and
other Internal Revenue Service employees to the extent that
such communications appear to compromise the independence of
the appeals officers.
(b) Savings Provisions.--
(1) Preservation of specific tax rights and remedies.--
Nothing in the plan developed and implemented under
subsection (a) shall be considered to impair any right or
remedy, including trial by jury, to recover any internal
revenue tax alleged to have been erroneously or illegally
assessed or collected, or any penalty claimed to have been
collected without authority, or any sum alleged to have been
excessive or in any manner wrongfully collected under the
internal revenue laws. For the purpose of any action to
recover any such tax, penalty, or sum, all statutes, rules,
and regulations referring to the collector of internal
revenue, the principal officer for the internal revenue
district, or the Secretary, shall be deemed to refer to the
officer whose act or acts referred to in the preceding
sentence gave rise to such action. The venue of any such
action shall be the same as under existing law.
(2) Continuing effect of legal documents.--All orders,
determinations, rules, regulations, permits, agreements,
grants, contracts, certificates, licenses, registrations,
privileges, and other administrative actions--
(A) which have been issued, made, granted, or allowed to
become effective by the President, any Federal agency or
official thereof, or by a court of competent jurisdiction, in
the performance of any function transferred or affected by
the reorganization of the Internal Revenue Service or any
other administrative unit of the Department of the Treasury
under this section, and
(B) which are in effect at the time this section takes
effect, or were final before the effective date of this
section and are to become effective on or after the effective
date of this section,
shall continue in effect according to their terms until
modified, terminated, superseded, set aside, or revoked in
accordance with law by the President, the Secretary of the
Treasury, the Commissioner of Internal Revenue, or other
authorized official, a court of competent jurisdiction, or by
operation of law.
(3) Proceedings not affected.--The provisions of this
section shall not affect any proceedings, including notices
of proposed rulemaking, or any application for any license,
permit, certificate, or financial assistance pending before
the Department of the Treasury (or any administrative unit of
the Department, including the Internal Revenue Service) at
the time this section takes effect, with respect to functions
transferred or affected by the reorganization under this
section but such proceedings and applications shall continue.
Orders shall be issued in such proceedings, appeals shall be
taken therefrom, and payments shall be made pursuant to such
orders, as if this section had not been enacted, and orders
issued in any such proceedings shall continue in effect until
modified, terminated, superseded, or revoked by a duly
authorized official, by a court of competent jurisdiction, or
by operation of law. Nothing in this paragraph shall be
deemed to prohibit the discontinuance or modification of any
such proceeding under the same terms and conditions and to
the same extent that such proceeding could have been
discontinued or modified if this section had not been
enacted.
(4) Suits not affected.--The provisions of this section
shall not affect suits commenced before the effective date of
this section, and in all such suits, proceedings shall be
had, appeals taken, and judgments rendered in the same manner
and with the same effect as if this section had not been
enacted.
(5) Nonabatement of actions.--No suit, action, or other
proceeding commenced by or against the Department of the
Treasury (or any administrative unit of the Department,
including the Internal Revenue Service), or by or against any
individual in the official capacity of such individual as an
officer of the Department of the Treasury, shall abate by
reason of the enactment of this section.
(6) Administrative actions relating to promulgation of
regulations.--Any administrative action relating to the
preparation or promulgation of a regulation by the Department
of the Treasury (or any administrative unit of the
Department, including the Internal Revenue Service) relating
to a function transferred or affected by the reorganization
under this section may be continued by the Department of the
Treasury through any appropriate administrative unit of the
Department, including the Internal Revenue Service with the
same effect as if this section had not been enacted.
(c) Effective Date.--This section shall take effect on the
date of the enactment of this Act.
SEC. 1002. IRS MISSION TO FOCUS ON TAXPAYERS' NEEDS.
The Internal Revenue Service shall review and restate its
mission to place a greater emphasis on serving the public and
meeting taxpayers' needs.
Subtitle B--Executive Branch Governance and Senior Management
SEC. 1101. INTERNAL REVENUE SERVICE OVERSIGHT BOARD.
(a) In General.--Section 7802 (relating to the Commissioner
of Internal Revenue) is amended to read as follows:
``SEC. 7802. INTERNAL REVENUE SERVICE OVERSIGHT BOARD.
``(a) Establishment.--There is established within the
Department of the Treasury the Internal Revenue Service
Oversight Board (hereafter in this subchapter referred to as
the `Oversight Board').
``(b) Membership.--
``(1) Composition.--The Oversight Board shall be composed
of 9 members, as follows:
``(A) 6 members shall be individuals who are not otherwise
Federal officers or employees and who are appointed by the
President, by and with the advice and consent of the Senate.
``(B) 1 member shall be the Secretary of the Treasury or,
if the Secretary so designates, the Deputy Secretary of the
Treasury.
``(C) 1 member shall be the Commissioner of Internal
Revenue.
``(D) 1 member shall be an individual who is a full-time
Federal employee or a representative of employees and who is
appointed by the President, by and with the advice and
consent of the Senate.
``(2) Qualifications and terms.--
``(A) Qualifications.--Members of the Oversight Board
described in paragraph (1)(A) shall be appointed without
regard to political affiliation and solely on the basis of
their professional experience and expertise in 1 or more of
the following areas:
``(i) Management of large service organizations.
``(ii) Customer service.
``(iii) Federal tax laws, including tax administration and
compliance.
``(iv) Information technology.
``(v) Organization development.
``(vi) The needs and concerns of taxpayers.
``(vii) The needs and concerns of small businesses.
In the aggregate, the members of the Oversight Board
described in paragraph (1)(A) should collectively bring to
bear expertise in all of the areas described in the preceding
sentence.
``(B) Terms.--Each member who is described in subparagraph
(A) or (D) of paragraph (1) shall be appointed for a term of
5 years, except that of the members first appointed under
paragraph (1)(A)--
``(i) 2 members shall be appointed for a term of 3 years,
``(ii) 2 members shall be appointed for a term of 4 years,
and
``(iii) 2 members shall be appointed for a term of 5 years.
``(C) Reappointment.--An individual who is described in
subparagraph (A) or (D) of paragraph (1) may be appointed to
no more than two 5-year terms on the Oversight Board.
``(D) Vacancy.--Any vacancy on the Oversight Board shall be
filled in the same manner as the original appointment. Any
member appointed to fill a vacancy occurring before the
expiration of the term for which the member's predecessor was
appointed shall be appointed for the remainder of that term.
``(3) Ethical considerations.--
``(A) Financial disclosure.--During the entire period that
an individual appointed under subparagraph (A) or (D) of
paragraph (1) is a member of the Oversight Board, such
individual shall be treated as serving as an officer or
employee referred to in section 101(f) of the Ethics in
Government Act of 1978 for purposes of title I of such Act,
except that section 101(d) of such Act shall apply without
regard to the number of days of service in the position.
``(B) Restrictions on post-employment.--For purposes of
section 207(c) of title 18, United States Code, an individual
appointed under subparagraph (A) or (D) of paragraph (1)
shall be treated as an employee referred to in section
207(c)(2)(A)(i) of such title during the entire period the
individual is a member of the Board, except that subsections
(c)(2)(B) and (f) of section 207 of such title shall not
apply.
``(C) Members who are special government employees.--If an
individual appointed under subparagraph (A) or (D) of
paragraph (1) is a special Government employee, the following
additional rules apply for purposes of chapter 11 of title
18, United States Code:
[[Page
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``(i) Restriction on representation.--In addition to any
restriction under section 205(c) of title 18, United States
Code, except as provided in subsections (d) through (i) of
section 205 of such title, such individual (except in the
proper discharge of official duties) shall not, with or
without compensation, represent anyone to or before any
officer or employee of--
``(I) the Oversight Board or the Internal Revenue Service
on any matter,
``(II) the Department of the Treasury on any matter
involving the internal revenue laws or involving the
management or operations of the Internal Revenue Service,
or
``(III) the Department of Justice with respect to
litigation involving a matter described in subclause (I) or
(II).
``(ii) Compensation for services provided by another.--For
purposes of section 203 of such title--
``(I) such individual shall not be subject to the
restrictions of subsection (a)(1) thereof for sharing in
compensation earned by another for representations on matters
covered by such section, and
``(II) a person shall not be subject to the restrictions of
subsection (a)(2) thereof for sharing such compensation with
such individual.
``(D) Waiver.--The President may, only at the time the
President nominates the member of the Oversight Board
described in paragraph (1)(D), waive for the term of the
member any appropriate provision of chapter 11 of title 18,
United States Code, to the extent such waiver is necessary to
allow such member to participate in the decisions of the
Board while continuing to serve as a full-time Federal
employee or a representative of employees. Any such waiver
shall not be effective unless a written intent of waiver to
exempt such member (and actual waiver language) is submitted
to the Senate with the nomination of such member.
``(4) Quorum.--5 members of the Oversight Board shall
constitute a quorum. A majority of members present and voting
shall be required for the Oversight Board to take action.
``(5) Removal.--
``(A) In general.--Any member of the Oversight Board
appointed under subparagraph (A) or (D) of paragraph (1) may
be removed at the will of the President.
``(B) Secretary and commissioner.--An individual described
in subparagraph (B) or (C) of paragraph (1) shall be removed
upon termination of service in the office described in such
subparagraph.
``(6) Claims.--
``(A) In general.--Members of the Oversight Board who are
described in subparagraph (A) or (D) of paragraph (1) shall
have no personal liability under Federal law with respect to
any claim arising out of or resulting from an act or omission
by such member within the scope of service as a member.
``(B) Effect on other law.--This paragraph shall not be
construed--
``(i) to affect any other immunities and protections that
may be available to such member under applicable law with
respect to such transactions,
``(ii) to affect any other right or remedy against the
United States under applicable law, or
``(iii) to limit or alter in any way the immunities that
are available under applicable law for Federal officers and
employees.
``(c) General Responsibilities.--
``(1) Oversight.--
``(A) In general.--The Oversight Board shall oversee the
Internal Revenue Service in its administration, management,
conduct, direction, and supervision of the execution and
application of the internal revenue laws or related statutes
and tax conventions to which the United States is a party.
``(B) Mission of irs.--As part of its oversight functions
described in subparagraph (A), the Oversight Board shall
ensure that the organization and operation of the Internal
Revenue Service allows it to carry out its mission.
``(C) Confidentiality.--The Oversight Board shall ensure
that appropriate confidentiality is maintained in the
exercise of its duties.
``(2) Exceptions.--The Oversight Board shall have no
responsibilities or authority with respect to--
``(A) the development and formulation of Federal tax policy
relating to existing or proposed internal revenue laws,
related statutes, and tax conventions,
``(B) specific law enforcement activities of the Internal
Revenue Service, including specific compliance activities
such as examinations, collection activities, and criminal
investigations,
``(C) specific procurement activities of the Internal
Revenue Service, or
``(D) except as provided in subsection (d)(3), specific
personnel actions.
``(d) Specific Responsibilities.--The Oversight Board shall
have the following specific responsibilities:
``(1) Strategic plans.--To review and approve strategic
plans of the Internal Revenue Service, including the
establishment of--
``(A) mission and objectives, and standards of performance
relative to either, and
``(B) annual and long-range strategic plans.
``(2) Operational plans.--To review the operational
functions of the Internal Revenue Service, including--
``(A) plans for modernization of the tax system,
``(B) plans for outsourcing or managed competition, and
``(C) plans for training and education.
``(3) Management.--To--
``(A) recommend to the President candidates for appointment
as the Commissioner of Internal Revenue and recommend to the
President the removal of the Commissioner,
``(B) review the Commissioner's selection, evaluation, and
compensation of Internal Revenue Service senior executives
who have program management responsibility over significant
functions of the Internal Revenue Service, and
``(C) review and approve the Commissioner's plans for any
major reorganization of the Internal Revenue Service.
``(4) Budget.--To--
``(A) review and approve the budget request of the Internal
Revenue Service prepared by the Commissioner,
``(B) submit such budget request to the Secretary of the
Treasury, and
``(C) ensure that the budget request supports the annual
and long-range strategic plans.
``(5) Taxpayer protection.--To ensure the proper treatment
of taxpayers by the employees of the Internal Revenue
Service.
The Secretary shall submit the budget request referred to in
paragraph (4)(B) for any fiscal year to the President who
shall submit such request, without revision, to Congress
together with the President's annual budget request for the
Internal Revenue Service for such fiscal year.
``(e) Board Personnel Matters.--
``(1) Compensation of members.--
``(A) In general.--Each member of the Oversight Board who--
``(i) is described in subsection (b)(1)(A), or
``(ii) is described in subsection (b)(1)(D) and is not
otherwise a Federal officer or employee,
shall be compensated at a rate of $30,000 per year. All other
members shall serve without compensation for such service.
``(B) Chairperson.--In lieu of the amount specified in
subparagraph (A), the Chairperson of the Oversight Board
shall be compensated at a rate of $50,000 per year.
``(2) Travel expenses.--
``(A) In general.--The members of the Oversight Board shall
be allowed travel expenses, including per diem in lieu of
subsistence, at rates authorized for employees of agencies
under subchapter I of chapter 57 of title 5, United States
Code, to attend meetings of the Oversight Board and, with the
advance approval of the Chairperson of the Oversight Board,
while otherwise away from their homes or regular places of
business for purposes of duties as a member of the Oversight
Board.
``(B) Report.--The Oversight Board shall include in its
annual report under subsection (f)(3)(A) information with
respect to the travel expenses allowed for members of the
Oversight Board under this paragraph.
``(3) Staff.--
``(A) In general.--The Chairperson of the Oversight Board
may appoint and terminate any personnel that may be necessary
to enable the Board to perform its duties.
``(B) Detail of government employees.--Upon request of the
Chairperson of the Oversight Board, a Federal agency shall
detail a Federal Government employee to the Oversight Board
without reimbursement. Such detail shall be without
interruption or loss of civil service status or privilege.
``(4) Procurement of temporary and intermittent services.--
The Chairperson of the Oversight Board may procure temporary
and intermittent services under section 3109(b) of title 5,
United States Code.
``(f) Administrative Matters.--
``(1) Chair.--
``(A) Term.--The members of the Oversight Board shall elect
for a 2-year term a chairperson from among the members
appointed under subsection (b)(1)(A).
``(B) Powers.--Except as otherwise provided by a majority
vote of the Oversight Board, the powers of the Chairperson
shall include--
``(i) establishing committees,
``(ii) setting meeting places and times,
``(iii) establishing meeting agendas, and
``(iv) developing rules for the conduct of business.
``(2) Meetings.--The Oversight Board shall meet at least
quarterly and at such other times as the Chairperson
determines appropriate.
``(3) Reports.--
``(A) Annual.--The Oversight Board shall each year report
with respect to the conduct of its responsibilities under
this title to the President, the Committees on Ways and
Means, Government Reform and Oversight, and Appropriations of
the House of Representatives and the Committees on Finance,
Governmental Affairs, and Appropriations of the Senate.
``(B) Additional report.--Upon a determination by the
Oversight Board under subsection (c)(1)(B) that the
organization and operation of the Internal Revenue Service
are not allowing it to carry out its mission, the Oversight
Board shall report such determination to the Committee on
Ways and Means of the House of Representatives and the
Committee on Finance of the Senate.''.
(b) Restriction on Disclosure of Return Information to
Oversight Board Members.--Section 6103(h) (relating to
disclosure to certain Federal officers and employees for
purposes of tax administration, etc.) is amended by adding at
the end the following new paragraph:
``(5) Internal revenue service oversight board.--
``(A) In general.--Notwithstanding paragraph (1), and
except as provided in subparagraph (B), no return or return
information may be disclosed to any member of the Oversight
Board described in subparagraph (A) or (D) of section
7802(b)(1) or to any employee or detailee of such Board by
reason of their service with the Board. Any request for
information not permitted to be disclosed under the
preceding sentence, and any contact relating to a specific
taxpayer, made by any such individual to an officer or
employee of the Internal Revenue Service shall be reported
by such officer or employee to the Secretary, the Treasury
Inspector General for Tax Administration, and the Joint
Committee on Taxation.
[[Page
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``(B) Exception for reports to the board.--If--
``(i) the Commissioner or the Treasury Inspector General
for Tax Administration prepares any report or other matter
for the Oversight Board in order to assist the Board in
carrying out its duties, and
``(ii) the Commissioner or such Inspector General
determines it is necessary to include any return or return
information in such report or other matter to enable the
Board to carry out such duties,
such return or return information (other than information
regarding taxpayer identity) may be disclosed to members,
employees, or detailees of the Board solely for the purpose
of carrying out such duties.''.
(c) Conforming Amendments.--
(1) Section 4946(c) (relating to definitions and special
rules for chapter 42) is amended by striking ``or'' at the
end of paragraph (5), by striking the period at the end of
paragraph (6) and inserting ``, or'', and by adding at the
end the following new paragraph:
``(7) a member of the Internal Revenue Service Oversight
Board.''.
(2) The table of sections for subchapter A of chapter 80 is
amended by striking the item relating to section 7802 and
inserting the following new item:
``Sec. 7802. Internal Revenue Service Oversight Board.''.
(d) Effective Date.--
(1) In general.--The amendments made by this section shall
take effect on the date of the enactment of this Act.
(2) Initial nominations to internal revenue service
oversight board.--The President shall submit the initial
nominations under section 7802 of the Internal Revenue Code
of 1986, as added by this section, to the Senate not later
than 6 months after the date of the enactment of this Act.
(3) Effect on actions prior to appointment of oversight
board.--Nothing in this section shall be construed to
invalidate the actions and authority of the Internal Revenue
Service prior to the appointment of the members of the
Internal Revenue Service Oversight Board.
SEC. 1102. COMMISSIONER OF INTERNAL REVENUE; OTHER OFFICIALS.
(a) In General.--Section 7803 (relating to other personnel)
is amended to read as follows:
``SEC. 7803. COMMISSIONER OF INTERNAL REVENUE; OTHER
OFFICIALS.
``(a) Commissioner of Internal Revenue.--
``(1) Appointment.--
``(A) In general.--There shall be in the Department of the
Treasury a Commissioner of Internal Revenue who shall be
appointed by the President, by and with the advice and
consent of the Senate, to a 5-year term. Such appointment
shall be made from individuals who, among other
qualifications, have a demonstrated ability in management.
``(B) Vacancy.--Any individual appointed to fill a vacancy
in the position of Commissioner occurring before the
expiration of the term for which such individual's
predecessor was appointed shall be appointed only for the
remainder of that term.
``(C) Removal.--The Commissioner may be removed at the will
of the President.
``(D) Reappointment.--The Commissioner may be appointed to
more than one 5-year term.
``(2) Duties.--The Commissioner shall have such duties and
powers as the Secretary may prescribe, including the power
to--
``(A) administer, manage, conduct, direct, and supervise
the execution and application of the internal revenue laws or
related statutes and tax conventions to which the United
States is a party, and
``(B) recommend to the President a candidate for
appointment as Chief Counsel for the Internal Revenue Service
when a vacancy occurs, and recommend to the President the
removal of such Chief Counsel.
If the Secretary determines not to delegate a power specified
in subparagraph (A) or (B), such determination may not take
effect until 30 days after the Secretary notifies the
Committees on Ways and Means, Government Reform and
Oversight, and Appropriations of the House of Representatives
and the Committees on Finance, Governmental Affairs, and
Appropriations of the Senate.
``(3) Consultation with board.--The Commissioner shall
consult with the Oversight Board on all matters set forth in
paragraphs (2) and (3) (other than paragraph (3)(A)) of
section 7802(d).
``(b) Chief Counsel for the Internal Revenue Service.--
``(1) Appointment.--There shall be in the Department of the
Treasury a Chief Counsel for the Internal Revenue Service who
shall be appointed by the President, by and with the consent
of the Senate.
``(2) Duties.--The Chief Counsel shall be the chief law
officer for the Internal Revenue Service and shall perform
such duties as may be prescribed by the Secretary, including
the duty--
``(A) to be legal advisor to the Commissioner and the
Commissioner's officers and employees,
``(B) to furnish legal opinions for the preparation and
review of rulings and memoranda of technical advice,
``(C) to prepare, review, and assist in the preparation of
proposed legislation, treaties, regulations, and Executive
orders relating to laws which affect the Internal Revenue
Service,
``(D) to represent the Commissioner in cases before the Tax
Court, and
``(E) to determine which civil actions should be litigated
under the laws relating to the Internal Revenue Service and
prepare recommendations for the Department of Justice
regarding the commencement of such actions.
If the Secretary determines not to delegate a power specified
in subparagraph (A), (B), (C), (D), or (E), such
determination may not take effect until 30 days after the
Secretary notifies the Committees on Ways and Means,
Government Reform and Oversight, and Appropriations of the
House of Representatives and the Committees on Finance,
Governmental Affairs, and Appropriations of the Senate.
``(3) Persons to whom chief counsel reports.--The Chief
Counsel shall report directly to the Commissioner of Internal
Revenue, except that--
``(A) the Chief Counsel shall report to both the
Commissioner and the General Counsel for the Department of
the Treasury with respect to--
``(i) legal advice or interpretation of the tax law not
relating solely to tax policy, and
``(ii) tax litigation, and
``(B) the Chief Counsel shall report to the General Counsel
with respect to legal advice or interpretation of the tax law
relating solely to tax policy.
If there is any disagreement between the Commissioner and the
General Counsel with respect to any matter jointly referred
to them under subparagraph (A), such matter shall be
submitted to the Secretary or Deputy Secretary for
resolution.
``(4) Chief counsel personnel.--All personnel in the Office
of Chief Counsel shall report to the Chief Counsel.
``(c) Office of the Taxpayer Advocate.--
``(1) Establishment.--
``(A) In general.--There is established in the Internal
Revenue Service an office to be known as the `Office of the
Taxpayer Advocate'.
``(B) National taxpayer advocate.--
``(i) In general.--The Office of the Taxpayer Advocate
shall be under the supervision and direction of an official
to be known as the `National Taxpayer Advocate'. The National
Taxpayer Advocate shall report directly to the Commissioner
of Internal Revenue and shall be entitled to compensation at
the same rate as the highest rate of basic pay established
for the Senior Executive Service under section 5382 of title
5, United States Code, or, if the Secretary of the Treasury
so determines, at a rate fixed under section 9503 of such
title.
``(ii) Appointment.--The National Taxpayer Advocate shall
be appointed by the Secretary of the Treasury after
consultation with the Commissioner of Internal Revenue and
the Oversight Board and without regard to the provisions of
title 5, United States Code, relating to appointments in the
competitive service or the Senior Executive Service.
``(iii) Qualifications.--An individual appointed under
clause (ii) shall have--
``(I) a background in customer service as well as tax law,
and
``(II) experience in representing individual taxpayers.
``(iv) Restriction on employment.--An individual may be
appointed as the National Taxpayer Advocate only if such
individual was not an officer or employee of the Internal
Revenue Service during the 2-year period ending with such
appointment and such individual agrees not to accept any
employment with the Internal Revenue Service for at least 5
years after ceasing to be the National Taxpayer Advocate.
Service as an officer or employee of the Office of the
Taxpayer Advocate shall not be taken into account in applying
this clause.
``(2) Functions of office.--
``(A) In general.--It shall be the function of the Office
of the Taxpayer Advocate to--
``(i) assist taxpayers in resolving problems with the
Internal Revenue Service,
``(ii) identify areas in which taxpayers have problems in
dealings with the Internal Revenue Service,
``(iii) to the extent possible, propose changes in the
administrative practices of the Internal Revenue Service to
mitigate problems identified under clause (ii), and
``(iv) identify potential legislative changes which may be
appropriate to mitigate such problems.
``(B) Annual reports.--
``(i) Objectives.--Not later than June 30 of each calendar
year, the National Taxpayer Advocate shall report to the
Committee on Ways and Means of the House of Representatives
and the Committee on Finance of the Senate on the objectives
of the Office of the Taxpayer Advocate for the fiscal year
beginning in such calendar year. Any such report shall
contain full and substantive analysis, in addition to
statistical information.
``(ii) Activities.--Not later than December 31 of each
calendar year, the National Taxpayer Advocate shall report to
the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of the Senate on
the activities of the Office of the Taxpayer Advocate during
the fiscal year ending during such calendar year. Any such
report shall contain full and substantive analysis, in
addition to statistical information, and shall--
``(I) identify the initiatives the Office of the Taxpayer
Advocate has taken on improving taxpayer services and
Internal Revenue Service responsiveness,
``(II) contain recommendations received from individuals
with the authority to issue Taxpayer Assistance Orders under
section 7811,
``(III) contain a summary of at least 20 of the most
serious problems encountered by taxpayers, including
a description of the nature of such problems,
``(IV) contain an inventory of the items described in
subclauses (I), (II), and (III) for which action has been
taken and the result of such action,
``(V) contain an inventory of the items described in
subclauses (I), (II), and (III) for which action remains to
be completed and the period during which each item has
remained on such inventory,
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``(VI) contain an inventory of the items described in
subclauses (I), (II), and (III) for which no action has been
taken, the period during which each item has remained on such
inventory, the reasons for the inaction, and identify any
Internal Revenue Service official who is responsible for such
inaction,
``(VII) identify any Taxpayer Assistance Order which was
not honored by the Internal Revenue Service in a timely
manner, as specified under section 7811(b),
``(VIII) contain recommendations for such administrative
and legislative action as may be appropriate to resolve
problems encountered by taxpayers,
``(IX) identify areas of the tax law that impose
significant compliance burdens on taxpayers or the Internal
Revenue Service, including specific recommendations for
remedying these problems,
``(X) identify the 10 most litigated issues for each
category of taxpayers, including recommendations for
mitigating such disputes, and
``(XI) include such other information as the National
Taxpayer Advocate may deem advisable.
``(iii) Report to be submitted directly.--Each report
required under this subparagraph shall be provided directly
to the committees described in clause (i) without any prior
review or comment from the Commissioner, the Secretary of the
Treasury, the Oversight Board, any other officer or employee
of the Department of the Treasury, or the Office of
Management and Budget.
``(iv) Coordination with report of treasury inspector
general for tax administration.--To the extent that
information required to be reported under clause (ii) is also
required to be reported under paragraph (1) or (2) of
subsection (d) by the Treasury Inspector General for Tax
Administration, the National Taxpayer Advocate shall not
contain such information in the report submitted under such
clause.
``(C) Other responsibilities.--The National Taxpayer
Advocate shall--
``(i) monitor the coverage and geographic allocation of
local offices of taxpayer advocates,
``(ii) develop guidance to be distributed to all Internal
Revenue Service officers and employees outlining the criteria
for referral of taxpayer inquiries to local offices of
taxpayer advocates,
``(iii) ensure that the local telephone number for each
local office of the taxpayer advocate is published and
available to taxpayers served by the office, and
``(iv) in conjunction with the Commissioner, develop career
paths for local taxpayer advocates choosing to make a career
in the Office of the Taxpayer Advocate.
``(D) Personnel actions.--
``(i) In general.--The National Taxpayer Advocate shall
have the responsibility and authority to--
``(I) appoint local taxpayer advocates and make available
at least 1 such advocate for each State, and
``(II) evaluate and take personnel actions (including
dismissal) with respect to any employee of any local office
of a taxpayer advocate described in subclause (I).
``(ii) Consultation.--The National Taxpayer Advocate may
consult with the appropriate supervisory personnel of the
Internal Revenue Service in carrying out the National
Taxpayer Advocate's responsibilities under this subparagraph.
``(3) Responsibilities of commissioner.--The Commissioner
shall establish procedures requiring a formal response to all
recommendations submitted to the Commissioner by the National
Taxpayer Advocate within 3 months after submission to the
Commissioner.
``(4) Operation of local offices.--
``(A) In general.--Each local taxpayer advocate--
``(i) shall report to the National Taxpayer Advocate or
delegate thereof,
``(ii) may consult with the appropriate supervisory
personnel of the Internal Revenue Service regarding the daily
operation of the local office of the taxpayer advocate,
``(iii) shall, at the initial meeting with any taxpayer
seeking the assistance of a local office of the taxpayer
advocate, notify such taxpayer that the taxpayer advocate
offices operate independently of any other Internal Revenue
Service office and report directly to Congress through the
National Taxpayer Advocate, and
``(iv) may, at the taxpayer advocate's discretion, not
disclose to the Internal Revenue Service contact with, or
information provided by, such taxpayer.
``(B) Maintenance of independent communications.--Each
local office of the taxpayer advocate shall maintain a
separate phone, facsimile, and other electronic communication
access, and a separate post office address.
``(d) Additional Duties of the Treasury Inspector General
for Tax Administration.--
``(1) Annual reporting.--The Treasury Inspector General for
Tax Administration shall include in one of the semiannual
reports under section 5 of the Inspector General Act of
1978--
``(A) an evaluation of the compliance of the Internal
Revenue Service with--
``(i) restrictions under section 1204 of the Internal
Revenue Service Restructuring and Reform Act of 1998 on the
use of enforcement statistics to evaluate Internal Revenue
Service employees,
``(ii) restrictions under section 7521 on directly
contacting taxpayers who have indicated that they prefer
their representatives be contacted,
``(iii) required procedures under section 6320 upon the
filing of a notice of a lien,
``(iv) required procedures under subchapter D of chapter 64
for seizure of property for collection of taxes, including
required procedures under section 6330 regarding levies, and
``(v) restrictions under section 3707 of the Internal
Revenue Service Restructuring and Reform Act of 1998 on
designation of taxpayers,
``(B) a review and a certification of whether or not the
Secretary is complying with the requirements of section
6103(e)(8) to disclose information to an individual filing a
joint return on collection activity involving the other
individual filing the return,
``(C) information regarding extensions of the statute of
limitations for assessment and collection of tax under
section 6501 and the provision of notice to taxpayers
regarding requests for such extension,
``(D) an evaluation of the adequacy and security of the
technology of the Internal Revenue Service,
``(E) any termination or mitigation under section 1203 of
the Internal Revenue Service Restructuring and Reform Act of
1998,
``(F) information regarding improper denial of requests for
information from the Internal Revenue Service identified
under paragraph (3)(A), and
``(G) information regarding any administrative or civil
actions with respect to violations of the fair debt
collection provisions of section 6304, including--
``(i) a summary of such actions initiated since the date of
the last report, and
``(ii) a summary of any judgments or awards granted as a
result of such actions.
``(2) Semiannual reports.--
``(A) In general.--The Treasury Inspector General for Tax
Administration shall include in each semiannual report under
section 5 of the Inspector General Act of 1978--
``(i) the number of taxpayer complaints during the
reporting period;
``(ii) the number of employee misconduct and taxpayer abuse
allegations received by the Internal Revenue Service or the
Inspector General during the period from taxpayers, Internal
Revenue Service employees, and other sources;
``(iii) a summary of the status of such complaints and
allegations; and
``(iv) a summary of the disposition of such complaints and
allegations, including the outcome of any Department of
Justice action and any monies paid as a settlement of such
complaints and allegations.
``(B) Clauses (iii) and (iv) of subparagraph (A) shall only
apply to complaints and allegations of serious employee
misconduct.
``(3) Other responsibilities.--The Treasury Inspector
General for Tax Administration shall--
``(A) conduct periodic audits of a statistically valid
sample of the total number of determinations made by the
Internal Revenue Service to deny written requests to disclose
information to taxpayers on the basis of section 6103 of this
title or section 552(b)(7) of title 5, United States Code,
and
``(B) establish and maintain a toll-free telephone number
for taxpayers to use to confidentially register complaints of
misconduct by Internal Revenue Service employees and
incorporate the telephone number in the statement required by
section 6227 of the Omnibus Taxpayer Bill of Rights (Internal
Revenue Service Publication No. 1).''.
(b) Notice of Right To Contact Office Included in Notice of
Deficiency.--Section 6212(a) (relating to notice of
deficiency) is amended by adding at the end the following new
sentence: ``Such notice shall include a notice to the
taxpayer of the taxpayer's right to contact a local office of
the taxpayer advocate and the location and phone number of
the appropriate office.''.
(c) Expansion of Authority To Issue Taxpayer Assistance
Orders.--Section 7811(a) (relating to taxpayer assistance
orders) is amended to read as follows:
``(a) Authority To Issue.--
``(1) In general.--Upon application filed by a taxpayer
with the Office of the Taxpayer Advocate (in such form,
manner, and at such time as the Secretary shall by
regulations prescribe), the National Taxpayer Advocate may
issue a Taxpayer Assistance Order if--
``(A) the National Taxpayer Advocate determines the
taxpayer is suffering or about to suffer a significant
hardship as a result of the manner in which the internal
revenue laws are being administered by the Secretary, or
``(B) the taxpayer meets such other requirements as are set
forth in regulations prescribed by the Secretary.
``(2) Determination of hardship.--For purposes of paragraph
(1), a significant hardship shall include--
``(A) an immediate threat of adverse action,
``(B) a delay of more than 30 days in resolving taxpayer
account problems,
``(C) the incurring by the taxpayer of significant costs
(including fees for professional representation) if relief is
not granted, or
``(D) irreparable injury to, or a long-term adverse impact
on, the taxpayer if relief is not granted.
``(3) Standard where administrative guidance not
followed.--In cases where any Internal Revenue Service
employee is not following applicable published administrative
guidance (including the Internal Revenue Manual), the
National Taxpayer Advocate shall construe the factors taken
into account in determining whether to issue a taxpayer
assistance order in the manner most favorable to the
taxpayer.''.
(d) Conforming Amendments Relating to National Taxpayer
Advocate.--
(1) The following provisions are each amended by striking
``Taxpayer Advocate'' each place it appears and inserting
``National Taxpayer Advocate'':
(A) Section 6323(j)(1)(D) (relating to withdrawal of notice
in certain circumstances).
(B) Section 6343(d)(2)(D) (relating to return of property
in certain cases).
(C) Section 7811(b)(2)(D) (relating to terms of a Taxpayer
Assistance Order).
(D) Section 7811(c) (relating to authority to modify or
rescind).
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(E) Section 7811(d)(2) (relating to suspension of running
of period of limitation).
(F) Section 7811(e) (relating to independent action of
Taxpayer Advocate).
(G) Section 7811(f) (relating to Taxpayer Advocate).
(2) Section 7811(d)(1) (relating to suspension of running
of period of limitation) is amended by striking ``Taxpayer
Advocate's'' and inserting ``National Taxpayer Advocate's''.
(3) The headings of subsections (e) and (f) of section 7811
are each amended by striking ``Taxpayer Advocate'' and
inserting ``National Taxpayer Advocate''.
(e) Additional Conforming Amendments.--
(1) The table of sections for subchapter A of chapter 80 is
amended by striking the item relating to section 7803 and
inserting the following new item:
``Sec. 7803. Commissioner of Internal Revenue; other officials.''.
(2) Section 5109 of title 5, United States Code, is amended
by striking subsection (b) and redesignating subsection (c)
as subsection (b).
(3) Section 7611(f)(1) (relating to restrictions on church
tax inquiries and examinations) is amended by striking
``Assistant Commissioner for Employee Plans and Exempt
Organizations of the Internal Revenue Service'' and inserting
``Secretary''.
(f) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall take effect on the date
of the enactment of this Act.
(2) Chief counsel.--Section 7803(b)(3) of the Internal
Revenue Code of 1986, as added by this section, shall take
effect on the date that is 90 days after the date of the
enactment of this Act.
(3) National taxpayer advocate.--Notwithstanding section
7803(c)(1)(B)(iv) of such Code, as added by this section, in
appointing the first National Taxpayer Advocate after the
date of the enactment of this Act, the Secretary of the
Treasury--
(A) shall not appoint any individual who was an officer or
employee of the Internal Revenue Service at any time during
the 2-year period ending on the date of appointment, and
(B) need not consult with the Internal Revenue Service
Oversight Board if the Oversight Board has not been
appointed.
(4) Current officers.--
(A) In the case of an individual serving as Commissioner of
Internal Revenue on the date of the enactment of this Act who
was appointed to such position before such date, the 5-year
term required by section 7803(a)(1) of such Code, as added by
this section, shall begin as of the date of such appointment.
(B) Clauses (ii), (iii), and (iv) of section 7803(c)(1)(B)
of
