No official summary available for this bill.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6323 Introduced in House (IH)]
<DOC>
119th CONGRESS
1st Session
H. R. 6323
To amend the Internal Revenue Code of 1986 to penalize improper
compliance with certain taxpayer requirements, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
November 28, 2025
Mr. Panetta (for himself and Mr. Steube) introduced the following bill;
which was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to penalize improper
compliance with certain taxpayer requirements, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; ETC.
(a) Short Title.--This Act may be cited as the ``Taxpayer
Protection and Preparer Proficiency Act''.
(b) References to Internal Revenue Code.--Except as otherwise
expressly provided, whenever in this Act an amendment is expressed in
terms of an amendment to 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) References to Secretary.--For purposes of this Act, the term
``Secretary'' means the Secretary of the Treasury or the Secretary's
delegate.
SEC. 2. PENALTIES FOR TAX RETURN PREPARERS WHO IMPROPERLY ALTER
RETURNS.
(a) In General.--Paragraph (1) of section 6696(e) is amended to
read as follows:
``(1) Return.--The term `return' means--
``(A) any return of any tax imposed by this title,
``(B) any administrative adjustment request under
section 6227,
``(C) any partnership adjustment tracking report
under section 6226(b)(4)(A), and
``(D) any other document purporting to be a return,
request, or report described in subparagraphs (A)
through (C).''.
(b) Effective Date.--The amendment made by this section shall take
effect on the date of enactment of this Act.
SEC. 3. PENALTIES FOR INVALID OR APPROPRIATED PREPARER IDENTIFICATION
NUMBERS.
(a) In General.--Section 6695 is amended--
(1) by striking subsection (c) and inserting the following:
``(c) Failure To Furnish Valid Identifying Number.--
``(1) In general.--
``(A) Penalty.--Any person who is a tax return
preparer with respect to any return or claim for refund
and who fails to furnish an identifying number which
complies with section 6109(a)(4)(A) with respect to
such return or claim shall pay a penalty of $250 for
such failure.
``(B) Non-compliance.--For purposes of this
paragraph, an identifying number shall be deemed to not
comply with section 6109(a)(4)(A) if such identifying
number--
``(i) is assigned to another person,
``(ii) does not exist,
``(iii) is inactive or expired,
``(iv) has been withdrawn,
``(v) is suspended or has been revoked, or
``(vi) is otherwise invalid for use by the
tax return preparer.
``(2) Exception.--The penalty imposed under paragraph (1)
shall not apply if it is shown that such failure is due to
reasonable cause and not due to willful neglect.
``(3) Limitation.--The maximum penalty imposed under this
subsection on any person with respect to documents filed during
any calendar year shall not exceed $75,000.'',
(2) by redesignating subsection (h) as subsection (i),
(3) by inserting after subsection (g) the following new
subsection:
``(h) Use of Invalid or Appropriated Electronic Filing
Identification Number.--
``(1) In general.--Any person who is an electronic return
originator with respect to any return or claim for refund who
fails to use, with respect to such return or claim, an
electronic filing identification number which is assigned to
such person by the Secretary, shall pay a penalty of $250 for
such failure, unless it is shown that such failure is due to
reasonable cause and not due to willful neglect.
``(2) Definitions.--For purposes of this subsection--
``(A) Electronic return originator.--
``(i) In general.--The term `electronic
return originator' means a person who
originates the electronic submission of 1 or
more returns or claims for refund on behalf of
other taxpayers.
``(ii) Exceptions.--The term `electronic
return originator' shall not include a person
merely because such person originates an
electronic submission described in clause (i)--
``(I) by furnishing mechanical
assistance to a person described in
such subclause,
``(II) at the direction of an
employer (or of an officer or employee
of the employer) by whom such person is
regularly and continuously employed,
``(III) as a fiduciary, or
``(IV) in response to a
determination that directly or
indirectly affects the tax liability of
a taxpayer.
``(B) Electronic filing identification number.--
``(i) In general.--The term `electronic
filing identification number' means an
identification number assigned by the Secretary
to a person authorized to file returns in
electronic format on behalf of other taxpayers.
``(ii) Suspension or revocation.--In the
case of any electronic filing identification
number which has been suspended or revoked by
the Secretary, such number shall not be deemed
valid for purposes of paragraph (1).'', and
(4) in subsection (i)(1), as redesignated by paragraph (2),
by striking ``and (g)'' and inserting ``(g), and (h)''.
(b) Modification of Definition of Tax Return Preparer.--Section
7701(a)(36) is amended--
(1) by striking subparagraph (A) and inserting the
following:
``(A) In general.--The term `tax return preparer'
means any person who prepares for compensation, or who
employs one or more persons to prepare for
compensation, any return of tax imposed by this title,
any document purporting to be a return of tax imposed
by this title, or any claim for refund of tax imposed
by this title. For purposes of the preceding sentence,
the preparation of a substantial portion of a return,
document purporting to be a return, or claim for refund
shall be treated as if it were the preparation of such
return, document purporting to be a return, or claim
for refund.'', and
(2) in subparagraph (B)--
(A) in clause (ii), by striking ``return or claim
for refund'' and inserting ``return, document
purporting to be a return, or claim for refund'', and
(B) in clause (iii), by striking ``return or claim
for refund'' and inserting ``return, document
purporting to be a return, or claim for refund''.
(c) Prevention of Inadvertent Errors Involving Identifying
Numbers.--
(1) In general.--Not later than 18 months after the date of
enactment of this Act, the Secretary shall establish a program
to improve voluntary compliance with respect to requirements
under subsections (c) and (h) of section 6695 of the Internal
Revenue Code of 1986 (as amended by this section) and avoid the
imposition of penalties under such subsections.
(2) Opportunity to correct.--For purposes of the program
described in paragraph (1), the Secretary shall--
(A) prior to acceptance for processing, identify--
(i) any return or claim for refund which
has been electronically submitted and does not
include an identifying number which complies
with section 6109(a)(4)(A) of the Internal
Revenue Code of 1986, and
(ii) any return or claim for refund which
has been electronically submitted and does not
include an electronic filing identification
number (as defined in section 6695(h)(2)(B) of
such Code), and
(B) provide an opportunity for the person who
submitted such return or claim for refund to avoid
imposition of a penalty under subsection (c) or (h) of
section 6695 of such Code, as applicable, if--
(i) such return or claim for refund is
withdrawn, or
(ii) the correct identifying number or
electronic filing identification number is
provided.
(d) Criminal Penalty.--
(1) In general.--Part I of subchapter A of chapter 75 is
amended by adding at the end the following new section:
``SEC. 7218. WILLFUL MISUSE OR MISAPPROPRIATION OF IDENTIFYING NUMBER.
``(a) In General.--Any tax return preparer who, with respect to any
return, document purporting to be a return, or claim for refund--
``(1) willfully fails to furnish a valid preparer tax
identification number with intent to evade or defeat the
application of any requirement under any provision of this
title which requires such preparer to obtain and furnish such
number,
``(2) willfully furnishes a preparer tax identification
number which--
``(A) does not exist,
``(B) is inactive or expired,
``(C) has been withdrawn,
``(D) is suspended or has been revoked, or
``(E) is otherwise invalid for use by such tax
return preparer, or
``(3) willfully furnishes a preparer tax identification
number which is assigned to another person,
shall, in addition to any other penalties provided by law, be guilty of
a felony and, upon conviction thereof, shall be fined not more than
$50,000 ($100,000 in the case of a corporation), or imprisoned not more
than 2 years, or both, together with the costs of prosecution.
``(b) Preparer Tax Identification Number.--The term `preparer tax
identification number' means an identifying number described in section
6109(a)(4)(A).''.
(2) Clerical amendment.--The table of sections for part I
of subchapter A of chapter 75 is amended by adding at the end
the following new item:
``Sec. 7218. Willful misuse or misappropriation of identifying
number.''.
(e) Effective Date.--The amendments made by this section shall
apply to returns or claims for refund filed after the date which is 18
months after the date of enactment of this Act.
SEC. 4. PENALTIES FOR IMPROPER TAX PREPARATION OR MISAPPROPRIATION OF
REFUNDS.
(a) Other Assessable Penalties With Respect to the Preparation of
Tax Returns for Other Persons.--Section 6695, as amended by the
preceding provisions of this Act, is amended--
(1) in subsection (a)--
(A) by striking ``$50'' and inserting ``$250'', and
(B) by striking ``$25,000'' and inserting
``$50,000'',
(2) in subsection (b)--
(A) by striking ``$50'' and inserting ``$250'', and
(B) by striking ``$25,000'' and inserting
``$75,000'',
(3) in subsection (d)--
(A) by striking ``$50'' and inserting ``$250'', and
(B) by striking ``$25,000'' and inserting
``$50,000'',
(4) in subsection (e)--
(A) by striking ``$50'' and inserting ``$250'', and
(B) by striking ``$25,000'' and inserting
``$75,000'',
(5) in subsection (g), by striking ``$500'' and inserting
``$1,000'', and
(6) in subsection (i)(1)--
(A) by striking ``2014'' and inserting ``2024'',
and
(B) by striking ``calendar year 2013'' and
inserting ``calendar year 2023''.
(b) Misappropriation of Electronic Funds Transfer.--
(1) In general.--Subsection (f) of section 6695 is amended
to read as follows:
``(f) Negotiation of Check; Misappropriation.--
``(1) In general.--Any person who is a tax return preparer
who--
``(A) endorses or otherwise negotiates (directly or
through an agent) any check made in respect of the
taxes imposed by this title which is issued to a
taxpayer (other than the tax return preparer), or
``(B) misappropriates any refund (or advance
payment with respect to a refundable credit), or any
portion thereof, issued to any taxpayer through an
electronic funds transfer,
shall pay a penalty in an amount determined under paragraph
(2).
``(2) Penalty.--The amount of the penalty determined under
this paragraph shall, with respect to each check or transfer
described in paragraph (1), be equal to the greater of--
``(A) $1,000, or
``(B) the full amount of such check or transfer.
``(3) Exception.--Paragraph (1)(A) shall not apply with
respect to the deposit by a bank (within the meaning of section
581) of the full amount of the check in the taxpayer's account
in such bank for the benefit of the taxpayer.''.
(2) Conforming amendment.--Section 6695(i)(1) is amended by
striking ``(f),'' and inserting ``(f)(2)(A),''.
SEC. 5. AUTHORITY TO DENY, REVOKE, OR SUSPEND PREPARER TAX
IDENTIFICATION NUMBERS.
(a) In General.--Section 6109 is amended--
(1) in subsection (a), by striking paragraph (4) and
inserting the following:
``(4) Furnishing identifying number of tax return
preparer.--
``(A) In general.--Any return or claim for refund
which is prepared by a tax return preparer shall bear
such identifying number for securing proper
identification of such preparer, their employer, or
both, as may be prescribed.
``(B) Exception for supervised preparer.--
Subparagraph (A) shall not apply with respect to any
tax return preparer who prepares any return or claim
for refund if such preparer is--
``(i) employed by a specified practitioner,
and
``(ii) under the supervision and direction
of a tax return preparer who--
``(I) includes their identifying
number (as described in subparagraph
(A)) on such return or claim,
``(II) signs such return or claim,
and
``(III) is a specified
practitioner.
``(C) Suspension or revocation.--In the case of any
identifying number which has been suspended or revoked
by the Secretary under subsection (e), such number
shall not be deemed valid for purposes of subparagraph
(A).
``(D) Definitions.--For purposes of this section--
``(i) Specified practitioner.--The term
`specified practitioner' means a certified
public accountant, attorney, or enrolled
agent--
``(I) who is in good standing and
authorized to represent persons before
the Department of the Treasury under
section 330 of title 31, United States
Code, and
``(II) whose professional license
or certification has not been revoked.
``(ii) Return; claim for refund.--The terms
`return' and `claim for refund' have the
respective meanings given to such terms by
section 6696(e).'', and
(2) by inserting after subsection (d) the following:
``(e) Identifying Number of Tax Return Preparer.--
``(1) In general.--The Secretary shall maintain a program
for administration of preparer tax identification numbers
required under subsection (a)(4), which shall include
restrictions on the issuance of such numbers to any individual
other than an individual who--
``(A) meets the suitability requirements of
paragraph (2) and the education requirements of
paragraph (3),
``(B) meets the state program requirements of
paragraph (4), or
``(C) is a specified practitioner.
``(2) Demonstration of suitability.--
``(A) In general.--An individual meets the
suitability requirements of this paragraph if such
individual has demonstrated to the Secretary the
individual's suitability to be a tax return preparer
by--
``(i) providing such information as the
Secretary determines necessary, and
``(ii) undergoing a background check,
including a review by the Secretary regarding
compliance with personal tax obligations.
``(B) Conduct demonstrating lack of suitability.--
For purposes of subparagraph (A), an individual shall
be deemed to have failed to demonstrate their
suitability to be a tax return preparer if--
``(i) any license or registration issued to
such individual by a State to prepare tax
returns has been suspended or revoked by such
State, or
``(ii) the Secretary determines that such
individual is described in clauses (ii) through
(vi) of paragraph (5)(A).
``(C) Regulations and guidance.--The Secretary
shall issue such regulations or other guidance as the
Secretary determines necessary to carry out the
purposes of this paragraph.
``(D) Prohibition on examinations.--For purposes of
subparagraph (A), except as provided in paragraph
(3)(C)(iii), the Secretary may not require an
examination as a prerequisite for the assignment or
renewal of a preparer tax identification number.
``(E) Grandfathering of prior background checks.--
For purposes of subparagraph (A)(ii), in the case of an
individual who has undergone a background check prior
to the date of enactment of this subsection, the
Secretary may deem such individual to have satisfied
the requirement under such subparagraph.
``(3) Educational programs.--
``(A) In general.--An individual meets the
education requirements of this paragraph if such
individual completes a specified number of hours of
educational programs on ethics, professional
responsibility, and tax law (including recently enacted
legislation) as may be required by the Secretary prior
to the assignment or renewal of a preparer tax
identification number.
``(B) Additional educational requirements for
renewal.--The Secretary may require any individual
seeking the renewal of a preparer tax identification
number to complete educational programs in addition to
those required under subparagraph (A). Any educational
programs required under this subparagraph shall be
based on--
``(i) a review of returns which include the
preparer tax identification number of such
preparer, and
``(ii) any errors identified by the
Secretary as part of the review described in
clause (i).
``(C) Other requirements.--For purposes of this
paragraph, the Secretary--
``(i) may not require a tax return preparer
to annually complete more than 18 hours of
educational programs,
``(ii) shall require that any educational
program include written materials which satisfy
such standards as are established by the
Secretary,
``(iii) may require that any educational
program include a method to ensure that the tax
return preparer attended the program and
sufficiently understood the material presented,
and
``(iv) may not direct any educational
program to be completed through a specific
provider.
``(D) Notice of failure to timely complete
requirements.--The Secretary shall provide any tax
return preparer who fails to complete the requirements
of this paragraph notice of such failure and a period
in which to cure such failure.
``(E) Publication of approved courses.--The
Secretary shall publish, on the public website of the
Internal Revenue Service--
``(i) a list of educational programs which
have been determined by the Secretary to
satisfy the requirement under clause (ii) of
subparagraph (C) (and, if applicable, the
requirement under clause (iii) of such
subparagraph), including the providers of such
programs, and
``(ii) any such requirements as the
Secretary deems necessary to impose with
respect to any additional programs required
under subparagraph (B).
``(4) Exemption.--
``(A) In general.--Subject to subparagraph (B), any
individual meets the state program requirements of this
paragraph if such individual maintains a valid State
license or registration issued by a State licensing
program or State registration program (including State
tax education councils) which includes examination,
education, and background check requirements that are
determined by the Secretary (on the basis of such
information as is provided by the taxpayer or State
program) to be comparable to the suitability
requirements described in paragraph (2) and the
education requirements described in paragraph (3).
``(B) Grandfathering of certain programs.--For
purposes of subparagraph (A), with respect to
determining whether a State licensing program or State
registration program (including State tax education
councils) includes examination, education, and
background check requirements which are comparable to
the suitability requirements described in paragraph (2)
and the education requirements described in paragraph
(3), such determination shall be made by the Secretary
without regard to whether such requirements were
included in such program at the time that such
individual was licensed or registered under such
program, provided that such requirements are, as of the
date that such individual requested assignment or
renewal of a preparer tax identification number under
this subsection, presently included in such program.
``(5) Authority to revoke or suspend preparer tax
identification number.--
``(A) In general.--The Secretary may suspend or
revoke a preparer tax identification number if, after
notice and opportunity for a hearing, the Secretary
makes a determination that the tax return preparer--
``(i) has not met--
``(I) the suitability requirements
of paragraph (2) and the education
requirements of paragraph (3), or
``(II) the State program
requirements of paragraph (4),
``(ii) is incompetent, as demonstrated by a
repeated pattern of errors in returns that were
prepared by such preparer or individuals who
were supervised by such preparer (as described
in subsection (a)(4)(B)) which affected the
determination of tax liability in such returns,
``(iii) is disreputable, as demonstrated
by--
``(I) giving false or misleading
information under paragraph (2)(A)(i),
``(II) failure to comply with
personal tax obligations,
``(III) revocation or suspension of
any license or registration issued by a
State for the preparation of tax
returns,
``(IV) conviction of any criminal
offense--
``(aa) involving dishonesty
or breach of trust, or
``(bb) which is punishable
under this title,
``(V) a final determination of
liability for a penalty pursuant to
section 6694, 6695(h), 6700, 6701, or
6702, or
``(VI) any conduct similar to the
conduct described in subclauses (I)
through (V),
``(iv) in the case of a person subject to
regulation under section 330 of title 31,
United States Code, or regulations prescribed
thereunder, has violated the requirements under
such section or such regulations,
``(v) with intent to defraud, willfully and
knowingly misleads or threatens--
``(I) the person whose return or
claim for refund is being prepared, or
``(II) a prospective person seeking
for a return or claim for refund to be
prepared, or
``(vi) has engaged in conduct (as
identified in regulations or guidance issued by
the Secretary) which is similar to the conduct
described in clauses (i) through (v) and that
the denial, suspension, or revocation of such
number would promote compliance with the
requirements of this title and effective tax
administration.
``(B) Monetary penalty.--
``(i) In general.--In addition to, or in
lieu of, any suspension or revocation of a
preparer tax identification number under
subparagraph (A), the Secretary may impose a
penalty in any amount not exceeding--
``(I) in the case of any
determination made by the Secretary
with respect to a tax return preparer
which is described in subparagraph (A)
(with the exception of clause (v) of
such subparagraph), $1,000 with respect
to each such determination, and
``(II) in the case of any
determination made by the Secretary
with respect to a tax return preparer
which is described in subparagraph
(A)(v), $5,000 with respect to each
such determination.
``(ii) Reduction.--Any penalty imposed
under clause (i) shall be reduced by the amount
of any penalty imposed under section 6694,
6695, 6700, 6701, or 6702 with regard to the
same conduct.
``(iii) Adjustment for inflation.--
``(I) In general.--In the case of
any penalty imposed during any calendar
year beginning after 2025, the $1,000
amount in clause (i)(I) and the $5,000
amount in clause (i)(II) shall each be
increased by an amount equal to--
``(aa) such dollar amount,
multiplied by
``(bb) the cost-of-living
adjustment determined under
section 1(f)(3) for the
calendar year, determined by
substituting `calendar year
2024' for `calendar year 2016'
in subparagraph (A)(ii)
thereof.
``(II) Rounding.--If any amount
determined under subclause (I) is not a
multiple of $100, such amount shall be
rounded to the nearest multiple of
$100.
``(C) Reinstatement.--The Secretary shall, through
regulations or other guidance, establish procedures to
allow any tax return preparer whose preparer tax
identification number has been suspended or revoked
pursuant to subparagraph (A) to have such number
reissued (or, in the case of a suspension, for such
suspension to be terminated), provided that such
preparer demonstrates, to the satisfaction of the
Secretary, that--
``(i) the conduct described in such
paragraph which was the basis for such
suspension or revocation has been sufficiently
addressed or resolved (such as through
completion of educational programs described in
paragraph (3) or reinstatement of a license
issued by a State for the preparation of tax
returns), and
``(ii) effective tax administration would
be promoted by terminating the suspension of
such number or reissuing such number to such
preparer.
``(D) Preliminary suspension.--
``(i) In general.--After notice and
opportunity to respond, the Secretary may
suspend the preparer tax identification number
of a tax return preparer for a period of not
greater than 180 days if the Secretary
determines that--
``(I) such tax return preparer has
engaged in any conduct described in
clauses (i) through (vi) of
subparagraph (A), and
``(II) such suspension is necessary
to prevent serious economic harm to
taxpayers or serious impairment of
effective tax administration, such as
to prevent the filing of fraudulent
returns or claims for refund.
``(ii) Limitation.--For purposes of clause
(i), if the preparer tax identification number
of a tax return preparer has been suspended
pursuant to such clause 2 times during any 5-
year period, the Secretary may not issue an
additional suspension pursuant to such clause
with respect to such preparer during such
period unless such suspension is subsequent to
a determination by the Secretary to suspend or
revoke the preparer tax identification number
of such preparer pursuant to subparagraph (A).
``(E) Regulations.--Not later than 24 months after
the date of enactment of this subsection, the Secretary
shall issue such regulations or other guidance as the
Secretary determines necessary to carry out the
purposes of this paragraph, including--
``(i) guidelines that identify the
particular penalty applicable to any conduct
described in subparagraph (A), and
``(ii) the manner of notice and opportunity
to respond for purposes of subparagraph (D).
``(6) Appeal.--In the case of any tax return preparer for
whom the Secretary has made a determination--
``(A) that such preparer has not met the
requirements of paragraphs (2) and (3) or of paragraph
(4) and that issuance of a preparer tax identification
number should be denied,
``(B) under paragraph (5)(A) that the preparer tax
identification number for such preparer should be
suspended or revoked, or
``(C) that a penalty should be imposed pursuant to
paragraph (5)(B),
such preparer shall be provided with an opportunity to appeal
such determination to the Internal Revenue Service Independent
Office of Appeals pursuant to procedures (as established by the
Secretary through regulations or other guidance) which are
similar to the procedures provided under section 330 of title
31, United States Code, or regulations prescribed thereunder.
``(7) Disclosure of final determinations.--
``(A) In general.--In the case of any final
determination with respect to the extended suspension,
revocation, reissuance, or termination of an extended
suspension of a preparer tax identification number
under this subsection, not later than 30 days following
such determination, the Secretary shall publish such
determination on the public website of the Internal
Revenue Service, which shall include--
``(i) a statement of the facts and
circumstances relating to such determination,
and
``(ii) the reasons for the determination.
``(B) Extended suspension.--For purposes of
subparagraph (A), the term `extended suspension' means
a suspension issued by the Secretary pursuant to
paragraph (5)(A) for a period of greater than 180 days.
``(8) Preparer tax identification number.--For purposes of
this subsection, the term `preparer tax identification number'
means an identifying number described in subsection
(a)(4)(A).''.
(b) Information Returns of Tax Return Preparers.--Section 6060 is
amended--
(1) by redesignating subsection (c) as subsection (d), and
(2) by inserting after subsection (b) the following:
``(c) Additional Information From Supervisors.--In the case of a
person required to make a return under subsection (a) who is described
in section 6109(a)(4)(B)(ii)(III), such person shall include in such
return--
``(1) the name and taxpayer identification number of any
tax return preparer under their supervision and direction who,
pursuant to subparagraph (B) of section 6109(a)(4), is exempted
from the requirement under subparagraph (A) of such section,
``(2) with respect to each tax return preparer described in
paragraph (1), whether such preparer is employed by such person
as of the date on which such return is made, and
``(3) such other information as the Secretary determines
appropriate.''.
(c) Determinations Regarding Practice Before the Department.--
Section 330 of title 31, United States Code, is amended--
(1) by redesignating subsection (e) as subsection (f); and
(2) by inserting after subsection (d) the following:
``(e) Disclosure of Final Determinations.--In the case of any final
determination under subsection (c) or (d), not later than 30 days
following such determination, the Secretary shall publish such
determination on a public website, which shall include--
``(1) a statement of the facts and circumstances relating
to such determination, and
``(2) the reasons for the determination.''.
(d) Disclosure Relating to Misconduct by Practitioners and Tax
Return Preparers.--
(1) In general.--Section 6103(k) is amended by adding at
the end the following new paragraph:
``(16) Disclosure relating to misconduct by practitioners
and tax return preparers.--Under such procedures as the
Secretary may prescribe, the Secretary may disclose returns and
return information to the extent the Secretary determines it is
necessary to publish determinations pursuant to section
6109(e)(7) and section 330(e) of title 31, United States Code,
provided that such disclosure is redacted to remove--
``(A) any name, address, or other identifying
information with respect to any persons other than the
representative or tax return preparer who is the
subject of such determination, and
``(B) such other information as the Secretary
determines appropriate to protect the privacy of such
persons.''.
(2) Conforming amendment.--Section 6103(p)(3)(A) is amended
by striking ``or (9)'' and inserting ``(9), or (16)''.
(e) Requirement To Include Identifying Number for Paid Preparer of
Offer-in-Compromise.--
(1) In general.--Section 6109(a) is amended by inserting
after paragraph (4) the following new paragraph:
``(5) Furnishing identifying number for offer-in-
compromise.--Any offer-in-compromise (as described in section
7122) which has been prepared by any person for compensation
shall include such identifying number as may be prescribed for
securing proper identification of such person.''.
(2) Penalty.--Section 7122 is amended by adding at the end
the following new subsection:
``(h) Failure To Furnish Identifying Number.--
``(1) In general.--
``(A) Penalty.--Any person who prepares an offer-
in-compromise for compensation and who fails to include
an identifying number which complies with section
6109(a)(5) with respect to such offer-in-compromise
shall pay a penalty of $250 for such failure.
``(B) Non-compliance.--For purposes of this
paragraph, an identifying number shall be deemed to not
comply with section 6109(a)(5) if such identifying
number--
``(i) is assigned to another person,
``(ii) does not exist,
``(iii) is inactive or expired,
``(iv) has been withdrawn,
``(v) is suspended or has been revoked, or
``(vi) is otherwise invalid for use by the
preparer.
``(C) Adjustment for inflation.--
``(i) In general.--In the case of any
documents filed during any calendar year
beginning after 2025, the $250 amount in
subparagraph (A) shall be increased by an
amount equal to--
``(I) such dollar amount,
multiplied by
``(II) the cost-of-living
adjustment determined under section
1(f)(3) for the calendar year,
determined by substituting `calendar
year 2024' for `calendar year 2016' in
subparagraph (A)(ii) thereof.
``(ii) Rounding.--If any amount determined
under clause (i) is not a multiple of $10, such
amount shall be rounded to the nearest multiple
of $10.
``(2) Exception.--The penalty imposed under paragraph (1)
shall not apply if it is shown that such failure is due to
reasonable cause and not due to willful neglect.
``(3) Limitation.--
``(A) In general.--The maximum penalty imposed
under this subsection on any person with respect to
documents filed during any calendar year shall not
exceed $75,000.
``(B) Adjustment for inflation.--
``(i) In general.--In the case of any
penalty imposed during any calendar year
beginning after 2025, the $75,000 amount in
subparagraph (A) shall be increased by an
amount equal to--
``(I) such dollar amount,
multiplied by
``(II) the cost-of-living
adjustment determined under section
1(f)(3) for the calendar year,
determined by substituting `calendar
year 2024' for `calendar year 2016' in
subparagraph (A)(ii) thereof.
``(ii) Rounding.--If any amount determined
under clause (i) is not a multiple of $1,000,
such amount shall be rounded to the nearest
multiple of $1,000.
``(4) Other applicable rules.--Rules similar to the rules
of section 6696 shall apply for purposes of this subsection.''.
(f) GAO Study and Report on the Exchange of Information Between the
IRS and State Taxation Authorities.--
(1) In general.--Not later than 18 months after the date of
the enactment of this Act, the Comptroller General of the
United States shall conduct a study and submit to Congress a
report on the sharing of information between the Secretary and
State authorities, as authorized under subsections (d) and
(k)(5) of section 6103 of the Internal Revenue Code of 1986,
regarding identification numbers issued to paid tax return
preparers and return preparer minimum standards.
(2) Increased information sharing.--The study and report
described in paragraph (1) shall include an analysis of the
impact that increased information sharing between Federal and
State authorities would have on efforts to enforce minimum
standards on paid tax return preparers.
(g) Publication of Common Errors and Penalties.--Not later than 36
months after the date of the enactment of this Act and annually
thereafter, the Commissioner of the Internal Revenue shall publish on
the public website of the Internal Revenue Service--
(1) the 10 most frequent errors found on tax returns which
were prepared by tax return preparers (as defined in section
7701(a)(36) of the Internal Revenue Code of 1986) during the
preceding calendar year, and
(2) with respect to the preceding calendar year, the top 10
reasons that tax return preparers were--
(A) subject to penalties imposed under the Internal
Revenue Code of 1986, or
(B) otherwise disciplined under section 6109 of
such Code or section 330 of title 31, United States
Code.
(h) Rule of Construction.--Nothing in this section (or amendment
made by this section) shall be construed to require the Secretary to
eliminate or terminate any existing program or authority--
(1) which, pursuant to section 330 of title 31, United
States Code, permits a tax return preparer to represent a
taxpayer before the Department of the Treasury in cases in
which such preparer prepared and signed the return of tax, or
(2) for publication of a public database on the website of
the Internal Revenue Service of tax return preparers who have
satisfied the requirements for issuance of a preparer tax
identification number (as defined in section 6109(e)(8) of the
Internal Revenue Code of 1986).
(i) Effective Date.--
(1) In general.--The amendments made by this section shall
take effect on the date which is 180 days after the date of
enactment of this Act.
(2) Transition rules for educational requirements for tax
return preparers.--
(A) Annual filing season program.--In the case of
any tax return preparer who, as of the date of
enactment of this Act, has received a record of
completion with respect to the Annual Filing Season
Program established by the Internal Revenue Service,
such tax return preparer shall be deemed to have
satisfied the education requirements of section
6109(e)(3) of the Internal Revenue Code of 1986 (as
added by this section) for the calendar year for which
such record of completion applies.
(B) Approved courses.--In the case of any entity
which, as of the date of enactment of this Act, is
approved to provide continuing education for purposes
of the Annual Filing Season Program established by the
Internal Revenue Service, such entity shall be deemed
to satisfy the applicable requirements under section
6109(e)(3) of the Internal Revenue Code of 1986 until
the date on which the Secretary has--
(i) issued such regulations or other
guidance as the Secretary determines necessary
for purposes of establishing standards for
educational programs under such section, and
(ii) pursuant to subparagraph (E) of such
section, published a list of educational
programs which have been determined by the
Secretary to satisfy the applicable
requirements under such section.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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