S.Amdt. 3150

SA 3150. Mr. CORNYN submitted an amendment intended to be proposed to
amendment SA 3060 proposed by Mr. Wyden to the bill H.R. 3474, to amend
the Internal Revenue Code of 1986 to allow employers to exempt
employees with health coverage under TRICARE or the Veterans
Administration from being taken into account for purposes of the
employer mandate under the Patient Protection and Affordable Care Act;
which was ordered to lie on the table; as follows:

At the end, add the following:

TITLE _--SMALL BUSINESS TAXPAYER BILL OF RIGHTS

SEC. _01. SHORT TITLE.

This title may be cited as the ``Small Business Taxpayer
Bill of Rights Act of 2014''.

SEC. _02. MODIFICATION OF STANDARDS FOR AWARDING OF COSTS AND
CERTAIN FEES.

(a) Small Businesses Eligible Without Regard to Net
Worth.--Subparagraph (D) of section 7430(c)(4) is amended by
striking ``and'' at the end of clause (i), by striking the
period at the end of clause (ii) and inserting ``and'', and
by adding at the end the following new clause:
``(iii) in the case of an eligible small business, the net
worth limitation in clause (ii) of such section shall not
apply.''.
(b) Eligible Small Business.--Paragraph (4) of section
7430(c) is amended by adding at the end the following new
subparagraph:
``(F) Eligible small business.--For purposes of
subparagraph (D)(iii), the term `eligible small business'
means, with respect to any proceeding commenced in a taxable
year--
``(i) a corporation the stock of which is not publicly
traded,
``(ii) a partnership, or
``(iii) a sole proprietorship,
if the average annual gross receipts of such corporation,
partnership, or sole proprietorship for the 3-taxable-year
period preceding such taxable year does not exceed
$50,000,000. For purposes of applying the test under the
preceding sentence, rules similar to the rules of paragraphs
(2) and (3) of section 448(c) shall apply.''.
(c) Effective Date.--The amendments made by this section
shall apply to proceedings commenced after the date of the
enactment of this Act.

SEC. _03. CIVIL DAMAGES ALLOWED FOR RECKLESS OR INTENTIONAL
DISREGARD OF INTERNAL REVENUE LAWS.

(a) Increase in Amount of Damages.--Section 7433(b) is
amended by striking ``$1,000,000 ($100,000, in the case of
negligence)'' and inserting ``$3,000,000 ($300,000, in the
case of negligence)''.
(b) Extension of Time To Bring Action.--Section 7433(d)(3)
is amended by striking ``2 years'' and inserting ``5 years''.
(c) Effective Date.--The amendments made by this section
shall apply to actions of employees of the Internal Revenue
Service after the date of the enactment of this Act.

SEC. _04. MODIFICATIONS RELATING TO CERTAIN OFFENSES BY
OFFICERS AND EMPLOYEES IN CONNECTION WITH
REVENUE LAWS.

(a) Increase in Penalty.--Section 7214 is amended--
(1) by striking ``$10,000'' in subsection (a) and inserting
``$25,000'', and
(2) by striking ``$5,000'' in subsection (b) and inserting
``$10,000''.
(b) Effective Date.--The amendments made by this section
shall take effect on the date of the enactment of this Act.

SEC. _05. MODIFICATIONS RELATING TO CIVIL DAMAGES FOR
UNAUTHORIZED INSPECTION OR DISCLOSURE OF
RETURNS AND RETURN INFORMATION.

(a) Increase in Amount of Damages.--Subparagraph (A) of
section 7431(c)(1) is amended by striking ``$1,000'' and
inserting ``$10,000''.
(b) Effective Date.--The amendment made by this section
shall apply to inspections and disclosure occurring on and
after the date of the enactment of this Act.

SEC. _06. INTEREST ABATEMENT REVIEWS.

(a) Filing Period for Interest Abatement Cases.--
(1) In general.--Subsection (h) of section 6404 is
amended--
(A) by striking ``Review of Denial'' in the heading and
inserting ``Judicial Review'', and
(B) by striking `` `if such action is brought' '' and all
that follows in paragraph (1) and inserting ``if such action
is brought--
``(A) at any time after the earlier of--
``(i) the date of the mailing of the Secretary's final
determination not to abate such interest, or
``(ii) the date which is 180 days after the date of the
filing with the Secretary (in such form as the Secretary may
prescribe) of a claim for abatement under this section, and
``(B) not later than the date which is 180 days after the
date described in subparagraph (A)(i).''.
(2) Effective date.--The amendments made by this subsection
shall apply to claims for abatement of interest filed with
the Secretary after the date of the enactment of this Act.
(b) Small Tax Case Election for Interest Abatement Cases.--
(1) In general.--Subsection (f) of section 7463 is
amended--
(A) by striking ``and'' at the end of paragraph (1),
(B) by striking the period at the end of paragraph (2) and
inserting ``, and'', and
(C) by adding at the end the following new paragraph:
``(3) a petition to the Tax court under section 6404(h) in
which the amount of interest abatement sought does not exceed
$50,000.''.
(2) Effective date.--The amendments made by this subsection
shall apply to--
(A) cases pending as of the day after the date of the
enactment of this Act, and
(B) cases commenced after such date of enactment.

SEC. _07. BAN ON EX PARTE DISCUSSIONS.

(a) In General.--Notwithstanding section 1001(a)(4) of the
Internal Revenue Service Restructuring and Reform Act of
1998, the Internal Revenue Service shall prohibit any ex
parte communications between officers in the Internal Revenue
Service Office of Appeals and other Internal Revenue Service
employees with respect to any matter pending before such
officers.
(b) Termination of Employment for Misconduct.--Subject to
subsection (c), the Commissioner of Internal Revenue shall
terminate the employment of any employee of the Internal
Revenue Service if there is a final administrative or
judicial determination that such employee committed any act
or omission prohibited under subsection (a) in the
performance of the employee's official duties. Such
termination shall be a removal for cause on charges of
misconduct.
(c) Determination of Commissioner.--
(1) In general.--The Commissioner of Internal Revenue may
take a personnel action other than termination for an act
prohibited under subsection (a).
(2) Discretion.--The exercise of authority under paragraph
(1) shall be at the sole discretion of the Commissioner of
Internal Revenue and may not be delegated to any other
officer. The Commissioner of Internal Revenue, in his sole
discretion, may establish a procedure which will be used to
determine whether an individual should be referred to the
Commissioner of Internal Revenue for a determination by the
Commissioner under paragraph (1).
(3) No appeal.--Any determination of the Commissioner of
Internal Revenue under this subsection may not be appealed in
any administrative or judicial proceeding.
(d) TIGTA Reporting of Termination or Mitigation.--Section
7803(d)(1)(E) of the Internal Revenue Code of 1986 is amended
by inserting ``or section 7 of the Small Business Taxpayer
Bill of Rights Act of 2014'' after ``1998''.

SEC. _08. ALTERNATIVE DISPUTE RESOLUTION PROCEDURES.

(a) In General.--Section 7123 is amended by adding at the
end the following new subsection:
``(c) Availability of Dispute Resolutions.--
``(1) In general.--The procedures prescribed under
subsection (b)(1) and the pilot program established under
subsection (b)(2) shall provide that a taxpayer may request
mediation or arbitration in any case unless the Secretary has
specifically excluded the type of issue involved in such case
or the class of cases to which such case belongs as not
appropriate for resolution under such subsection. The
Secretary shall make any determination that excludes a type
of issue or a class of cases public within 5 working days and
provide an explanation for each determination.
``(2) Independent mediators.--
``(A) In general.--The procedures prescribed under
subsection (b)(1) shall provide the taxpayer an opportunity
to elect to have the mediation conducted by an independent,
neutral individual not employed by the Office of Appeals.
``(B) Cost and selection.--
``(i) In general.--Any taxpayer making an election under
subparagraph (A) shall be required--

``(I) to share the costs of such independent mediator
equally with the Office of Appeals, and
``(II) to limit the selection of the mediator to a roster
of recognized national or local neutral mediators.

``(ii) Exception.--Clause (i)(I) shall not apply to any
taxpayer who is an individual or who was a small business in
the preceding calendar year if such taxpayer had an adjusted
gross income that did not exceed 250 percent of the poverty
level, as determined in accordance with criteria established
by the Director of the Office of Management and Budget, in
the taxable year preceding the request.
``(iii) Small business.--For purposes of clause (ii), the
term `small business' has the meaning given such term under
section 41(b)(3)(D)(iii).
``(3) Availability of process.--The procedures prescribed
under subsection (b)(1) and

[[Page S3106]]

the pilot program established under subsection (b)(2) shall
provide the opportunity to elect mediation or arbitration at
the time when the case is first filed with the Office of
Appeals and at any time before deliberations in the appeal
commence.''.
(b) Effective Date.--The amendment made by this section
shall take effect on the date of the enactment of this Act.

SEC. _09. EXTENSION OF TIME FOR CONTESTING IRS LEVY.

(a) Extension of Time for Return of Property Subject to
Levy.--Subsection (b) of section 6343 is amended by striking
``9 months'' and inserting ``3 years''.
(b) Period of Limitation on Suits.--Subsection (c) of
section 6532 is amended--
(1) in paragraph (1) by striking ``9 months'' and inserting
``3 years'', and
(2) in paragraph (2) by striking ``9-month'' and inserting
``3-year''.
(c) Effective Date.--The amendments made by this section
shall apply to--
(1) levies made after the date of the enactment of this
Act, and
(2) levies made on or before such date if the 9-month
period has not expired under section 6343(b) of the Internal
Revenue Code of 1986 (without regard to this section) as of
such date.

SEC. _10. WAIVER OF INSTALLMENT AGREEMENT FEE.

(a) In General.--Section 6159 is amended by redesignating
subsection (f) as subsection (g) and by inserting after
subsection (e) the following new subsection:
``(f) Waiver of Installment Agreement Fee.--The Secretary
shall waive the fees imposed on installment agreements under
this section for any taxpayer with an adjusted gross income
that does not exceed 250 percent of the poverty level, as
determined in accordance with criteria established by the
Director of the Office of Management and Budget, and who has
agreed to make payments under the installment agreement by
electronic payment through a debit instrument.''.
(b) Effective Date.--The amendment made by this section
shall take effect on the date of the enactment of this Act.

SEC. _11. SUSPENSION OF RUNNING OF PERIOD FOR FILING PETITION
OF SPOUSAL RELIEF AND COLLECTION CASES.

(a) Petitions for Spousal Relief.--
(1) In general.--Subsection (e) of section 6015 is amended
by adding at the end the following new paragraph:
``(6) Suspension of running of period for filing petition
in title 11 cases.--In the case of a person who is prohibited
by reason of a case under title 11, United States Code, from
filing a petition under paragraph (1)(A) with respect to a
final determination of relief under this section, the running
of the period prescribed by such paragraph for filing such a
petition with respect to such final determination shall be
suspended for the period during which the person is so
prohibited from filing such a petition, and for 60 days
thereafter.''.
(2) Effective date.--The amendment made by this subsection
shall apply to petitions filed under section 6015(e) of the
Internal Revenue Code of 1986 after the date of the enactment
of this Act.
(b) Collection Proceedings.--
(1) In general.--Subsection (d) of section 6330 is
amended--
(A) by striking ``appeal such determination to the Tax
Court'' in paragraph (1) and inserting ``petition the Tax
Court for review of such determination'',
(B) by striking ``Judicial review of determination'' in the
heading of paragraph (1) and inserting ``Petition for review
by tax court'',
(C) by redesignating paragraph (2) as paragraph (3), and
(D) by inserting after paragraph (1) the following new
paragraph:
``(2) Suspension of running of period for filing petition
in title 11 cases.--In the case of a person who is prohibited
by reason of a case under title 11, United States Code, from
filing a petition under paragraph (1) with respect to a
determination under this section, the running of the period
prescribed by such subsection for filing such a petition with
respect to such determination shall be suspended for the
period during which the person is so prohibited from filing
such a petition, and for 30 days thereafter.''.
(2) Conforming amendment.--Subsection (c) of section 6320
is amended by striking ``(2)(B)'' and inserting ``(3)(B)''.
(3) Effective date.--The amendments made by this subsection
shall apply to petitions filed under section 6330 of the
Internal Revenue Code of 1986 after the date of the enactment
of this Act.

SEC. _12. VENUE FOR APPEAL OF SPOUSAL RELIEF AND COLLECTION
CASES.

(a) In General.--Paragraph (1) of section 7482(b) is
amended--
(1) by striking ``or'' at the end of subparagraph (E),
(2) by striking the period at the end of subparagraph (F)
and inserting a comma, and
(3) by inserting after subparagraph (F) the following new
subparagraphs:
``(G) in the case of a petition under section 6015(e), the
legal residence of the petitioner, or
``(H) in the case of a petition under section 6320 or
6330--
``(i) the legal residence of the petitioner if the
petitioner is an individual, and
``(ii) the principal place of business or principal office
or agency if the petitioner is an entity other than an
individual.''.
(b) Effective Date.--The amendments made by this section
shall apply to petitions filed after the date of enactment of
this Act.

SEC. _13. INCREASE IN MONETARY PENALTIES FOR CERTAIN
UNAUTHORIZED DISCLOSURES OF INFORMATION.

(a) In General.--Paragraphs (1), (2), (3), and (4) of
section 7213(a) are each amended by striking ``$5,000'' and
inserting ``$10,000''.
(b) Effective Date.--The amendments made by this section
shall apply to disclosures made after the date of the
enactment of this Act.

SEC. _14. DE NOVO TAX COURT REVIEW OF CLAIMS FOR EQUITABLE
INNOCENT SPOUSE RELIEF.

(a) In General.--Subparagraph (A) of section 6015(e)(1) is
amended by adding at the end the following new flush
sentence:
``Any review of a determination by the Secretary with respect
to a claim for equitable relief under subsection (f) shall be
reviewed de novo by the Tax Court.''.
(b) Effective Date.--The amendment made by this section
shall apply to petitions filed or pending before the Tax
Court on and after the date of the enactment of this Act.

SEC. _15. BAN ON RAISING NEW ISSUES ON APPEAL.

(a) In General.--Chapter 77 is amended by adding at the end
the following new section:

``SEC. 7529. PROHIBITION ON INTERNAL REVENUE SERVICE RAISING
NEW ISSUES IN AN INTERNAL APPEAL.

``(a) In General.--In reviewing an appeal of any
determination initially made by the Internal Revenue Service,
the Internal Revenue Service Office of Appeals may not
consider or decide any issue that is not within the scope of
the initial determination.
``(b) Certain Issues Deemed Outside of Scope of
Determination.--For purposes of subsection (a), the following
matters shall be considered to be not within the scope of a
determination:
``(1) Any issue that was not raised in a notice of
deficiency or an examiner's report which is the subject of
the appeal.
``(2) Any deficiency in tax which was not included in the
initial determination.
``(3) Any theory or justification for a tax deficiency
which was not considered in the initial determination.
``(c) No Inference With Respect to Issues Raised by
Taxpayers.--Nothing in this section shall be construed to
provide any limitation in addition to any limitations in
effect on the date of the enactment of this section on the
right of a taxpayer to raise an issue, theory, or
justification on an appeal from a determination initially
made by the Internal Revenue Service that was not within the
scope of the initial determination.''.
(b) Clerical Amendment.--The table of sections for chapter
77 is amended by adding at the end the following new item:

``Sec. 7529. Prohibition on Internal Revenue Service raising new issues
in an internal appeal.''.
(c) Effective Date.--The amendments made by this section
shall apply to matters filed or pending with the Internal
Revenue Service Office of Appeals on or after the date of the
enactment of this Act.
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