United States Tax Court Modernization Act

        [Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 661 Reported in Senate (RS)]

Calendar No. 96
109th CONGRESS
1st Session
S. 661

[Report No. 109-64]

To amend the Internal Revenue Code of 1986 to provide for the
modernization of the United States Tax Court, and for other purposes.

_______________________________________________________________________

IN THE SENATE OF THE UNITED STATES

March 17, 2005

Mr. Hatch (for himself, Mr. Baucus, Mr. Grassley, and Mrs. Lincoln)
introduced the following bill; which was read twice and referred to the
Committee on Finance

April 28, 2005

Reported by Mr. Grassley, with an amendment
[Strike out all after the enacting clause and insert the part printed
in italic]

_______________________________________________________________________

A BILL

To amend the Internal Revenue Code of 1986 to provide for the
modernization of the United States Tax Court, and for other purposes.

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

<DELETED>SECTION 1. SHORT TITLE; ETC.</DELETED>

<DELETED>    (a) Short Title.--This Act may be cited as the ``United
States Tax Court Modernization Act''.</DELETED>
<DELETED>    (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.</DELETED>
<DELETED>    (c) Table of Contents.--The table of contents for this Act
is as follows:</DELETED>

<DELETED>Sec. 1. Short title; etc.
<DELETED>TITLE I--TAX COURT PROCEDURE

<DELETED>Sec. 101. Jurisdiction of Tax Court over collection due
process cases.
<DELETED>Sec. 102. Authority for special trial judges to hear and
decide certain employment status cases.
<DELETED>Sec. 103. Confirmation of authority of Tax Court to apply
doctrine of equitable recoupment.
<DELETED>Sec. 104. Tax Court filing fee in all cases commenced by
filing petition.
<DELETED>Sec. 105. Amendments to appoint employees.
<DELETED>Sec. 106. Expanded use of Tax Court practice fee for pro se
taxpayers.
<DELETED>TITLE II--TAX COURT PENSION AND COMPENSATION

<DELETED>Sec. 201. Annuities for survivors of Tax Court judges who are
assassinated.
<DELETED>Sec. 202. Cost-of-living adjustments for Tax Court judicial
survivor annuities.
<DELETED>Sec. 203. Life insurance coverage for Tax Court judges.
<DELETED>Sec. 204. Cost of life insurance coverage for Tax Court judges
age 65 or over.
<DELETED>Sec. 205. Modification of timing of lump-sum payment of
judges' accrued annual leave.
<DELETED>Sec. 206. Participation of Tax Court judges in the Thrift
Savings Plan.
<DELETED>Sec. 207. Exemption of teaching compensation of retired judges
from limitation on outside earned income.
<DELETED>Sec. 208. General provisions relating to magistrate judges of
the Tax Court.
<DELETED>Sec. 209. Annuities to surviving spouses and dependent
children of magistrate judges of the Tax
Court.
<DELETED>Sec. 210. Retirement and annuity program.
<DELETED>Sec. 211. Incumbent magistrate judges of the Tax Court.
<DELETED>Sec. 212. Provisions for recall.
<DELETED>Sec. 213. Effective date.

<DELETED>TITLE I--TAX COURT PROCEDURE</DELETED>

<DELETED>SEC. 101. JURISDICTION OF TAX COURT OVER COLLECTION DUE
PROCESS CASES.</DELETED>

<DELETED>    (a) In General.--Paragraph (1) of section 6330(d)
(relating to proceeding after hearing) is amended to read as
follows:</DELETED>
<DELETED>    ``(1) Judicial review of determination.--The
person may, within 30 days of a determination under this
section, appeal such determination to the Tax Court (and the
Tax Court shall have jurisdiction with respect to such
matter).''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by this section
shall apply to determinations made after the date which is 60 days
after the date of the enactment of this Act.</DELETED>

<DELETED>SEC. 102. AUTHORITY FOR SPECIAL TRIAL JUDGES TO HEAR AND
DECIDE CERTAIN EMPLOYMENT STATUS CASES.</DELETED>

<DELETED>    (a) In General.--Section 7443A(b) (relating to proceedings
which may be assigned to special trial judges) is amended by striking
``and'' at the end of paragraph (4), by redesignating paragraph (5) as
paragraph (6), and by inserting after paragraph (4) the following new
paragraph:</DELETED>
<DELETED>    ``(5) any proceeding under section 7436(c),
and''.</DELETED>
<DELETED>    (b) Conforming Amendment.--Section 7443A(c) is amended by
striking ``or (4)'' and inserting ``(4), or (5)''.</DELETED>
<DELETED>    (c) Effective Date.--The amendments made by this section
shall apply to any proceeding under section 7436(c) of the Internal
Revenue Code of 1986 with respect to which a decision has not become
final (as determined under section 7481 of such Code) before the date
of the enactment of this Act.</DELETED>

<DELETED>SEC. 103. CONFIRMATION OF AUTHORITY OF TAX COURT TO APPLY
DOCTRINE OF EQUITABLE RECOUPMENT.</DELETED>

<DELETED>    (a) Confirmation of Authority of Tax Court To Apply
Doctrine of Equitable Recoupment.--Section 6214(b) (relating to
jurisdiction over other years and quarters) is amended by adding at the
end the following new sentence: ``Notwithstanding the preceding
sentence, the Tax Court may apply the doctrine of equitable recoupment
to the same extent that it is available in civil tax cases before the
district courts of the United States and the United States Court of
Federal Claims.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by this section
shall apply to any action or proceeding in the United States Tax Court
with respect to which a decision has not become final (as determined
under section 7481 of the Internal Revenue Code of 1986) as of the date
of the enactment of this Act.</DELETED>

<DELETED>SEC. 104. TAX COURT FILING FEE IN ALL CASES COMMENCED BY
FILING PETITION.</DELETED>

<DELETED>    (a) In General.--Section 7451 (relating to fee for filing
a Tax Court petition) is amended by striking all that follows
``petition'' and inserting a period.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by this section
shall take effect on the date of the enactment of this Act.</DELETED>

<DELETED>SEC. 105. AMENDMENTS TO APPOINT EMPLOYEES.</DELETED>

<DELETED>    (a) In General.--Subsection (a) of section 7471 (relating
to Tax Court employees) is amended to read as follows:</DELETED>
<DELETED>    ``(a) Appointment and Compensation.--</DELETED>
<DELETED>    ``(1) Clerk.--The Tax Court may appoint a clerk
without regard to the provisions of title 5, United States
Code, governing appointments in the competitive service. The
clerk shall serve at the pleasure of the Tax Court.</DELETED>
<DELETED>    ``(2) Law clerks and secretaries.--</DELETED>
<DELETED>    ``(A) In general.--The judges and special
trial judges of the Tax Court may appoint law clerks
and secretaries, in such numbers as the Tax Court may
approve, without regard to the provisions of title 5,
United States Code, governing appointments in the
competitive service. Any such law clerk or secretary
shall serve at the pleasure of the appointing
judge.</DELETED>
<DELETED>    ``(B) Exemption from federal leave
provisions.--A law clerk appointed under this
subsection shall be exempt from the provisions of
subchapter I of chapter 63 of title 5, United States
Code. Any unused sick leave or annual leave standing to
the employee's credit as of the effective date of this
subsection shall remain credited to the employee and
shall be available to the employee upon separation from
the Federal Government.</DELETED>
<DELETED>    ``(3) Other employees.--The Tax Court may appoint
necessary employees without regard to the provisions of title
5, United States Code, governing appointments in the
competitive service. Such employees shall be subject to removal
by the Tax Court.</DELETED>
<DELETED>    ``(4) Pay.--The Tax Court may fix and adjust the
compensation for the clerk and other employees of the Tax Court
without regard to the provisions of chapter 51, subchapter III
of chapter 53, or section 5373 of title 5, United States Code.
To the maximum extent feasible, the Tax Court shall compensate
employees at rates consistent with those for employees holding
comparable positions in the judicial branch.</DELETED>
<DELETED>    ``(5) Programs.--The Tax Court may establish
programs for employee evaluations, incentive awards, flexible
work schedules, premium pay, and resolution of employee
grievances.</DELETED>
<DELETED>    ``(6) Discrimination prohibited.--The Tax Court
shall--</DELETED>
<DELETED>    ``(A) prohibit discrimination on the basis
of race, color, religion, age, sex, national origin,
political affiliation, marital status, or handicapping
condition; and</DELETED>
<DELETED>    ``(B) promulgate procedures for resolving
complaints of discrimination by employees and
applicants for employment.</DELETED>
<DELETED>    ``(7) Experts and consultants.--The Tax Court may
procure the services of experts and consultants under section
3109 of title 5, United States Code.</DELETED>
<DELETED>    ``(8) Rights to certain appeals reserved.--
Notwithstanding any other provision of law, an individual who
is an employee of the Tax Court on the day before the effective
date of this subsection and who, as of that day, was entitled
to--</DELETED>
<DELETED>    ``(A) appeal a reduction in grade or
removal to the Merit Systems Protection Board under
chapter 43 of title 5, United States Code,</DELETED>
<DELETED>    ``(B) appeal an adverse action to the
Merit Systems Protection Board under chapter 75 of
title 5, United States Code,</DELETED>
<DELETED>    ``(C) appeal a prohibited personnel
practice described under section 2302(b) of title 5,
United States Code, to the Merit Systems Protection
Board under chapter 77 of that title,</DELETED>
<DELETED>    ``(D) make an allegation of a prohibited
personnel practice described under section 2302(b) of
title 5, United States Code, with the Office of Special
Counsel under chapter 12 of that title for action in
accordance with that chapter, or</DELETED>
<DELETED>    ``(E) file an appeal with the Equal
Employment Opportunity Commission under part 1614 of
title 29 of the Code of Federal Regulations,</DELETED>
<DELETED>shall be entitled to file such appeal or make such an
allegation so long as the individual remains an employee of the
Tax Court.</DELETED>
<DELETED>    ``(9) Competitive status.--Notwithstanding any
other provision of law, any employee of the Tax Court who has
completed at least 1 year of continuous service under a non-
temporary appointment with the Tax Court acquires a competitive
status for appointment to any position in the competitive
service for which the employee possesses the required
qualifications.</DELETED>
<DELETED>    ``(10) Merit system principles; prohibited
personnel practices; and preference eligibles.--Any personnel
management system of the Tax Court shall--</DELETED>
<DELETED>    ``(A) include the principles set forth in
section 2301(b) of title 5, United States
Code;</DELETED>
<DELETED>    ``(B) prohibit personnel practices
prohibited under section 2302(b) of title 5, United
States Code; and</DELETED>
<DELETED>    ``(C) in the case of any individual who
would be a preference eligible in the executive branch,
the Tax Court will provide preference for that
individual in a manner and to an extent consistent with
preference accorded to preference eligibles in the
executive branch.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendments made by this section
shall take effect on the date the United States Tax Court adopts a
personnel management system after the date of the enactment of this
Act.</DELETED>

<DELETED>SEC. 106. EXPANDED USE OF TAX COURT PRACTICE FEE FOR PRO SE
TAXPAYERS.</DELETED>

<DELETED>    (a) In General.--Section 7475(b) (relating to use of fees)
is amended by inserting before the period at the end ``and to provide
services to pro se taxpayers''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by this section
shall take effect on the date of the enactment of this Act.</DELETED>

<DELETED>TITLE II--TAX COURT PENSION AND COMPENSATION</DELETED>

<DELETED>SEC. 201. ANNUITIES FOR SURVIVORS OF TAX COURT JUDGES WHO ARE
ASSASSINATED.</DELETED>

<DELETED>    (a) Eligibility in Case of Death by Assassination.--
Subsection (h) of section 7448 (relating to annuities to surviving
spouses and dependent children of judges) is amended to read as
follows:</DELETED>
<DELETED>    ``(h) Entitlement to Annuity.--</DELETED>
<DELETED>    ``(1) In general.--</DELETED>
<DELETED>    ``(A) Annuity to surviving spouse.--If a
judge described in paragraph (2) is survived by a
surviving spouse but not by a dependent child, there
shall be paid to such surviving spouse an annuity
beginning with the day of the death of the judge or
following the surviving spouse's attainment of the age
of 50 years, whichever is the later, in an amount
computed as provided in subsection (m).</DELETED>
<DELETED>    ``(B) Annuity to child.--If such a judge
is survived by a surviving spouse and a dependent child
or children, there shall be paid to such surviving
spouse an immediate annuity in an amount computed as
provided in subsection (m), and there shall also be
paid to or on behalf of each such child an immediate
annuity equal to the lesser of--</DELETED>
<DELETED>    ``(i) 10 percent of the average
annual salary of such judge (determined in
accordance with subsection (m)), or</DELETED>
<DELETED>    ``(ii) 20 percent of such average
annual salary, divided by the number of such
children.</DELETED>
<DELETED>    ``(C) Annuity to surviving dependent
children.--If such a judge leaves no surviving spouse
but leaves a surviving dependent child or children,
there shall be paid to or on behalf of each such child
an immediate annuity equal to the lesser of--</DELETED>
<DELETED>    ``(i) 20 percent of the average
annual salary of such judge (determined in
accordance with subsection (m)), or</DELETED>
<DELETED>    ``(ii) 40 percent of such average
annual salary, divided by the number of such
children.</DELETED>
<DELETED>    ``(2) Covered judges.--Paragraph (1) applies to
any judge electing under subsection (b)--</DELETED>
<DELETED>    ``(A) who dies while a judge after having
rendered at least 5 years of civilian service computed
as prescribed in subsection (n), for the last 5 years
of which the salary deductions provided for by
subsection (c)(1) or the deposits required by
subsection (d) have actually been made or the salary
deductions required by the civil service retirement
laws have actually been made, or</DELETED>
<DELETED>    ``(B) who dies by assassination after
having rendered less than 5 years of civilian service
computed as prescribed in subsection (n) if, for the
period of such service, the salary deductions provided
for by subsection (c)(1) or the deposits required by
subsection (d) have actually been made.</DELETED>
<DELETED>    ``(3) Termination of annuity.--</DELETED>
<DELETED>    ``(A) In the case of a surviving spouse.--
The annuity payable to a surviving spouse under this
subsection shall be terminable upon such surviving
spouse's death or such surviving spouse's remarriage
before attaining age 55.</DELETED>
<DELETED>    ``(B) In the case of a child.--The annuity
payable to a child under this subsection shall be
terminable upon (i) the child attaining the age of 18
years, (ii) the child's marriage, or (iii) the child's
death, whichever first occurs, except that if such
child is incapable of self-support by reason of mental
or physical disability the child's annuity shall be
terminable only upon death, marriage, or recovery from
such disability.</DELETED>
<DELETED>    ``(C) In the case of a dependent child
after death of surviving spouse.--In case of the death
of a surviving spouse of a judge leaving a dependent
child or children of the judge surviving such spouse,
the annuity of such child or children shall be
recomputed and paid as provided in paragraph
(1)(C).</DELETED>
<DELETED>    ``(D) Recomputation.--In any case in which
the annuity of a dependent child is terminated under
this subsection, the annuities of any remaining
dependent child or children, based upon the service of
the same judge, shall be recomputed and paid as though
the child whose annuity was so terminated had not
survived such judge.</DELETED>
<DELETED>    ``(4) Special rule for assassinated judges.--In
the case of a survivor or survivors of a judge described in
paragraph (2)(B), there shall be deducted from the annuities
otherwise payable under this section an amount equal to--
</DELETED>
<DELETED>    ``(A) the amount of salary deductions
provided for by subsection (c)(1) that would have been
made if such deductions had been made for 5 years of
civilian service computed as prescribed in subsection
(n) before the judge's death, reduced by</DELETED>
<DELETED>    ``(B) the amount of such salary deductions
that were actually made before the date of the judge's
death.''.</DELETED>
<DELETED>    (b) Definition of Assassination.--Section 7448(a)
(relating to definitions) is amended by adding at the end the following
new paragraph:</DELETED>
<DELETED>    ``(8) The terms `assassinated' and `assassination'
mean the killing of a judge that is motivated by the
performance by that judge of his or her official
duties.''.</DELETED>
<DELETED>    (c) Determination of Assassination.--Subsection (i) of
section 7448 is amended--</DELETED>
<DELETED>    (1) by striking the subsection heading and
inserting the following:</DELETED>
<DELETED>    ``(i) Determinations by Chief Judge.--</DELETED>
<DELETED>    ``(1) Dependency and disability.--'',</DELETED>
<DELETED>    (2) by moving the text 2 ems to the right,
and</DELETED>
<DELETED>    (3) by adding at the end the following new
paragraph:</DELETED>
<DELETED>    ``(2) Assassination.--The chief judge shall
determine whether the killing of a judge was an assassination,
subject to review only by the Tax Court. The head of any
Federal agency that investigates the killing of a judge shall
provide information to the chief judge that would assist the
chief judge in making such a determination.''.</DELETED>
<DELETED>    (d) Computation of Annuities.--Subsection (m) of section
7448 is amended--</DELETED>
<DELETED>    (1) by striking the subsection heading and
inserting the following:</DELETED>
<DELETED>    ``(m) Computation of Annuities.--</DELETED>
<DELETED>    ``(1) In general.--'',</DELETED>
<DELETED>    (2) by moving the text 2 ems to the right,
and</DELETED>
<DELETED>    (3) by adding at the end the following new
paragraph:</DELETED>
<DELETED>    ``(2) Assassinated judges.--In the case of a judge
who is assassinated and who has served less than 3 years, the
annuity of the surviving spouse of such judge shall be based
upon the average annual salary received by such judge for
judicial service.''.</DELETED>
<DELETED>    (e) Other Benefits.--Section 7448 is amended by adding at
the end the following:</DELETED>
<DELETED>    ``(u) Other Benefits.--In the case of a judge who is
assassinated, an annuity shall be paid under this section
notwithstanding a survivor's eligibility for or receipt of benefits
under chapter 81 of title 5, United States Code, except that the
annuity for which a surviving spouse is eligible under this section
shall be reduced to the extent that the total benefits paid under this
section and chapter 81 of that title for any year would exceed the
current salary for that year of the office of the judge.''.</DELETED>

<DELETED>SEC. 202. COST-OF-LIVING ADJUSTMENTS FOR TAX COURT JUDICIAL
SURVIVOR ANNUITIES.</DELETED>

<DELETED>    (a) In General.--Subsection (s) of section 7448 (relating
to annuities to surviving spouses and dependent children of judges) is
amended to read as follows:</DELETED>
<DELETED>    ``(s) Increases in Survivor Annuities.--Each time that an
increase is made under section 8340(b) of title 5, United States Code,
in annuities payable under subchapter III of chapter 83 of that title,
each annuity payable from the survivors annuity fund under this section
shall be increased at the same time by the same percentage by which
annuities are increased under such section 8340(b).''.</DELETED>
<DELETED>    (b) Effective Date.--The amendments made by this section
shall apply with respect to increases made under section 8340(b) of
title 5, United States Code, in annuities payable under subchapter III
of chapter 83 of that title, taking effect after the date of the
enactment of this Act.</DELETED>

<DELETED>SEC. 203. LIFE INSURANCE COVERAGE FOR TAX COURT
JUDGES.</DELETED>

<DELETED>    (a) In General.--Section 7447 (relating to retirement of
judges) is amended by adding at the end the following new
subsection:</DELETED>
<DELETED>    ``(j) Life Insurance Coverage.--For purposes of
chapter 87 of title 5, United States Code (relating to life
insurance), any individual who is serving as a judge of the Tax
Court or who is retired under this section is deemed to be an
employee who is continuing in active employment.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by this section
shall apply to any individual serving as a judge of the United States
Tax Court or to any retired judge of the United States Tax Court on the
date of the enactment of this Act.</DELETED>

<DELETED>SEC. 204. COST OF LIFE INSURANCE COVERAGE FOR TAX COURT JUDGES
AGE 65 OR OVER.</DELETED>

<DELETED>    Section 7472 (relating to expenditures) is amended by
inserting after the first sentence the following new sentence:
``Notwithstanding any other provision of law, the Tax Court is
authorized to pay on behalf of its judges, age 65 or over, any increase
in the cost of Federal Employees' Group Life Insurance imposed after
April 24, 1999, including any expenses generated by such payments, as
authorized by the chief judge in a manner consistent with such payments
authorized by the Judicial Conference of the United States pursuant to
section 604(a)(5) of title 28, United States Code.''.</DELETED>

<DELETED>SEC. 205. MODIFICATION OF TIMING OF LUMP-SUM PAYMENT OF
JUDGES' ACCRUED ANNUAL LEAVE.</DELETED>

<DELETED>    (a) In General.--Section 7443 (relating to membership of
the Tax Court) is amended by adding at the end the following new
subsection:</DELETED>
<DELETED>    ``(h) Lump-Sum Payment of Judges' Accrued Annual Leave.--
Notwithstanding the provisions of sections 5551 and 6301 of title 5,
United States Code, when an individual subject to the leave system
provided in chapter 63 of that title is appointed by the President to
be a judge of the Tax Court, the individual shall be entitled to
receive, upon appointment to the Tax Court, a lump-sum payment from the
Tax Court of the accumulated and accrued current annual leave standing
to the individual's credit as certified by the agency from which the
individual resigned.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by this section
shall apply to any judge of the United States Tax Court who has an
outstanding leave balance on the date of the enactment of this Act and
to any individual appointed by the President to serve as a judge of the
United States Tax Court after such date.</DELETED>

<DELETED>SEC. 206. PARTICIPATION OF TAX COURT JUDGES IN THE THRIFT
SAVINGS PLAN.</DELETED>

<DELETED>    (a) In General.--Section 7447 (relating to retirement of
judges), as amended by this Act, is amended by adding at the end the
following new subsection:</DELETED>
<DELETED>    ``(k) Thrift Savings Plan.--</DELETED>
<DELETED>    ``(1) Election to contribute.--</DELETED>
<DELETED>    ``(A) In general.--A judge of the Tax
Court may elect to contribute to the Thrift Savings
Fund established by section 8437 of title 5, United
States Code.</DELETED>
<DELETED>    ``(B) Period of election.--An election may
be made under this paragraph only during a period
provided under section 8432(b) of title 5, United States Code, for
individuals subject to chapter 84 of such title.</DELETED>
<DELETED>    ``(2) Applicability of title 5 provisions.--Except
as otherwise provided in this subsection, the provisions of
subchapters III and VII of chapter 84 of title 5, United States
Code, shall apply with respect to a judge who makes an election
under paragraph (1).</DELETED>
<DELETED>    ``(3) Special rules.--</DELETED>
<DELETED>    ``(A) Amount contributed.--The amount
contributed by a judge to the Thrift Savings Fund in
any pay period shall not exceed the maximum percentage
of such judge's basic pay for such period as allowable
under section 8440f of title 5, United States Code.
Basic pay does not include any retired pay paid
pursuant to this section.</DELETED>
<DELETED>    ``(B) Contributions for benefit of
judge.--No contributions may be made for the benefit of
a judge under section 8432(c) of title 5, United States
Code.</DELETED>
<DELETED>    ``(C) Applicability of section 8433(b) of
title 5 whether or not judge retires.--Section 8433(b)
of title 5, United States Code, applies with respect to
a judge who makes an election under paragraph (1) and
who either--</DELETED>
<DELETED>    ``(i) retires under subsection
(b), or</DELETED>
<DELETED>    ``(ii) ceases to serve as a judge
of the Tax Court but does not retire under
subsection (b).</DELETED>
<DELETED>Retirement under subsection (b) is a
separation from service for purposes of subchapters III
and VII of chapter 84 of that title.</DELETED>
<DELETED>    ``(D) Applicability of section 8351(b)(5)
of title 5.--The provisions of section 8351(b)(5) of
title 5, United States Code, shall apply with respect
to a judge who makes an election under paragraph
(1).</DELETED>
<DELETED>    ``(E) Exception.--Notwithstanding
subparagraph (C), if any judge retires under this
section, or resigns without having met the age and
service requirements set forth under subsection (b)(2),
and such judge's nonforfeitable account balance is less
than an amount that the Executive Director of the
Office of Personnel Management prescribes by
regulation, the Executive Director shall pay the
nonforfeitable account balance to the participant in a
single payment.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by this section
shall take effect on the date of the enactment of this Act, except that
United States Tax Court judges may only begin to participate in the
Thrift Savings Plan at the next open season beginning after such
date.</DELETED>

<DELETED>SEC. 207. EXEMPTION OF TEACHING COMPENSATION OF RETIRED JUDGES
FROM LIMITATION ON OUTSIDE EARNED INCOME.</DELETED>

<DELETED>    (a) In General.--Section 7447 (relating to retirement of
judges), as amended by this Act, is amended by adding at the end the
following new subsection:</DELETED>
<DELETED>    ``(l) Teaching Compensation of Retired Judges.--For
purposes of the limitation under section 501(a) of the Ethics in
Government Act of 1978 (5 U.S.C. App.), any compensation for teaching
approved under section 502(a)(5) of such Act shall not be treated as
outside earned income when received by a judge of the Tax Court who has
retired under subsection (b) for teaching performed during any calendar
year for which such a judge has met the requirements of subsection (c),
as certified by the chief judge of the Tax Court.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by this section
shall apply to any individual serving as a retired judge of the United
States Tax Court on or after the date of the enactment of this
Act.</DELETED>

<DELETED>SEC. 208. GENERAL PROVISIONS RELATING TO MAGISTRATE JUDGES OF
THE TAX COURT.</DELETED>

<DELETED>    (a) Title of Special Trial Judge Changed to Magistrate
Judge of the Tax Court.--The heading of section 7443A is amended to
read as follows:</DELETED>

<DELETED>``SEC. 7443A. MAGISTRATE JUDGES OF THE TAX COURT.''.</DELETED>

<DELETED>    (b) Appointment, Tenure, and Removal.--Subsection (a) of
section 7443A is amended to read as follows:</DELETED>
<DELETED>    ``(a) Appointment, Tenure, and Removal.--</DELETED>
<DELETED>    ``(1) Appointment.--The chief judge may, from time
to time, appoint and reappoint magistrate judges of the Tax
Court for a term of 8 years. The magistrate judges of the Tax
Court shall proceed under such rules as may be promulgated by
the Tax Court.</DELETED>
<DELETED>    ``(2) Removal.--Removal of a magistrate judge of
the Tax Court during the term for which he or she is appointed
shall be only for incompetency, misconduct, neglect of duty, or
physical or mental disability, but the office of a magistrate
judge of the Tax Court shall be terminated if the judges of the
Tax Court determine that the services performed by the
magistrate judge of the Tax Court are no longer needed. Removal
shall not occur unless a majority of all the judges of the Tax
Court concur in the order of removal. Before any order of
removal shall be entered, a full specification of the charges
shall be furnished to the magistrate judge of the Tax Court,
and he or she shall be accorded by the judges of the Tax Court
an opportunity to be heard on the charges.''.</DELETED>
<DELETED>    (c) Salary.--Section 7443A(d) (relating to salary) is
amended by striking ``90'' and inserting ``92''.</DELETED>
<DELETED>    (d) Exemption From Federal Leave Provisions.--Section
7443A is amended by adding at the end the following new
subsection:</DELETED>
<DELETED>    ``(f) Exemption From Federal Leave Provisions.--</DELETED>
<DELETED>    ``(1) In general.--A magistrate judge of the Tax
Court appointed under this section shall be exempt from the
provisions of subchapter I of chapter 63 of title 5, United
States Code.</DELETED>
<DELETED>    ``(2) Treatment of unused leave.--</DELETED>
<DELETED>    ``(A) After service as magistrate judge.--
If an individual who is exempted under paragraph (1)
from the subchapter referred to in such paragraph was
previously subject to such subchapter and, without a
break in service, again becomes subject to such
subchapter on completion of the individual's service as a magistrate
judge, the unused annual leave and sick leave standing to the
individual's credit when such individual was exempted from this
subchapter is deemed to have remained to the individual's
credit.</DELETED>
<DELETED>    ``(B) Computation of annuity.--In
computing an annuity under section 8339 of title 5,
United States Code, the total service of an individual
specified in subparagraph (A) who retires on an
immediate annuity or dies leaving a survivor or
survivors entitled to an annuity includes, without
regard to the limitations imposed by subsection (f) of
such section 8339, the days of unused sick leave
standing to the individual's credit when such
individual was exempted from subchapter I of chapter 63
of title 5, United States Code, except that these days
will not be counted in determining average pay or
annuity eligibility.</DELETED>
<DELETED>    ``(C) Lump sum payment.--Any accumulated
and current accrued annual leave or vacation balances
credited to a magistrate judge as of the date of the
enactment of this subsection shall be paid in a lump
sum at the time of separation from service pursuant to
the provisions and restrictions set forth in section
5551 of title 5, United States Code, and related
provisions referred to in such section.''.</DELETED>
<DELETED>    (e) Conforming Amendments.--</DELETED>
<DELETED>    (1) The heading of subsection (b) of section 7443A
is amended by striking ``Special Trial Judges'' and inserting
``Magistrate Judges of the Tax Court''.</DELETED>
<DELETED>    (2) Section 7443A(b) is amended by striking
``special trial judges of the court'' and inserting
``magistrate judges of the Tax Court''.</DELETED>
<DELETED>    (3) Subsections (c) and (d) of section 7443A are
amended by striking ``special trial judge'' and inserting
``magistrate judge of the Tax Court'' each place it
appears.</DELETED>
<DELETED>    (4) Section 7443A(e) is amended by striking
``special trial judges'' and inserting ``magistrate judges of
the Tax Court''.</DELETED>
<DELETED>    (5) Section 7456(a) is amended by striking
``special trial judge'' each place it appears and inserting
``magistrate judge''.</DELETED>
<DELETED>    (6) Subsection (c) of section 7471 is amended--
</DELETED>
<DELETED>    (A) by striking the subsection heading and
inserting ``Magistrate Judges of the Tax Court.--'',
and</DELETED>
<DELETED>    (B) by striking ``special trial judges''
and inserting ``magistrate judges''.</DELETED>

<DELETED>SEC. 209. ANNUITIES TO SURVIVING SPOUSES AND DEPENDENT
CHILDREN OF MAGISTRATE JUDGES OF THE TAX COURT.</DELETED>

<DELETED>    (a) Definitions.--Section 7448(a) (relating to
definitions), as amended by this Act, is amended by redesignating
paragraphs (5), (6), (7), and (8) as paragraphs (7), (8), (9), and
(10), respectively, and by inserting after paragraph (4) the following
new paragraphs:</DELETED>
<DELETED>    ``(5) The term `magistrate judge' means a judicial
officer appointed pursuant to section 7443A, including any
individual receiving an annuity under section 7443B, or
chapters 83 or 84, as the case may be, of title 5, United
States Code, whether or not performing judicial duties under
section 7443C.</DELETED>
<DELETED>    ``(6) The term `magistrate judge's salary' means
the salary of a magistrate judge received under section
7443A(d), any amount received as an annuity under section
7443B, or chapters 83 or 84, as the case may be, of title 5,
United States Code, and compensation received under section
7443C.''.</DELETED>
<DELETED>    (b) Election.--Subsection (b) of section 7448 (relating to
annuities to surviving spouses and dependent children of judges) is
amended--</DELETED>
<DELETED>    (1) by striking the subsection heading and
inserting the following:</DELETED>
<DELETED>    ``(b) Election.--</DELETED>
<DELETED>    ``(1) Judges.--'',</DELETED>
<DELETED>    (2) by moving the text 2 ems to the right,
and</DELETED>
<DELETED>    (3) by adding at the end the following new
paragraph:</DELETED>
<DELETED>    ``(2) Magistrate judges.--Any magistrate judge may
by written election filed with the chief judge bring himself or
herself within the purview of this section. Such election shall
be filed not later than the later of 6 months after--</DELETED>
<DELETED>    ``(A) 6 months after the date of the
enactment of this paragraph,</DELETED>
<DELETED>    ``(B) the date the judge takes office,
or</DELETED>
<DELETED>    ``(C) the date the judge
marries.''.</DELETED>
<DELETED>    (c) Conforming Amendments.--</DELETED>
<DELETED>    (1) The heading of section 7448 is amended by
inserting ``and magistrate judges'' after ``judges''.</DELETED>
<DELETED>    (2) The item relating to section 7448 in the table
of sections for part I of subchapter C of chapter 76 is amended
by inserting ``and magistrate judges'' after
``judges''.</DELETED>
<DELETED>    (3) Subsections (c)(1), (d), (f), (g), (h), (j),
(m), (n), and (u) of section 7448, as amended by this Act, are
each amended--</DELETED>
<DELETED>    (A) by inserting ``or magistrate judge''
after ``judge'' each place it appears other than in the
phrase ``chief judge'', and</DELETED>
<DELETED>    (B) by inserting ``or magistrate judge's''
after ``judge's'' each place it appears.</DELETED>
<DELETED>    (4) Section 7448(c) is amended--</DELETED>
<DELETED>    (A) in paragraph (1), by striking ``Tax
Court judges'' and inserting ``Tax Court judicial
officers'',</DELETED>
<DELETED>    (B) in paragraph (2)--</DELETED>
<DELETED>    (i) in subparagraph (A), by
inserting ``and section 7443A(d)'' after
``(a)(4)'', and</DELETED>
<DELETED>    (ii) in subparagraph (B), by
striking ``subsection (a)(4)'' and inserting
``subsections (a)(4) and (a)(6)''.</DELETED>
<DELETED>    (5) Section 7448(g) is amended by inserting ``or
section 7443B'' after ``section 7447'' each place it appears,
and by inserting ``or an annuity'' after ``retired
pay''.</DELETED>
<DELETED>    (6) Section 7448(j)(1) is amended--</DELETED>
<DELETED>    (A) in subparagraph (A), by striking
``service or retired'' and inserting ``service,
retired'', and by inserting ``, or receiving any
annuity under section 7443B or chapters 83 or 84 of
title 5, United States Code,'' after ``section 7447'',
and</DELETED>
<DELETED>    (B) in the last sentence, by striking
``subsections (a)(6) and (7)'' and inserting
``paragraphs (8) and (9) of subsection (a)''.</DELETED>
<DELETED>    (7) Section 7448(m)(1), as amended by this Act, is
amended--</DELETED>
<DELETED>    (A) by inserting ``or any annuity under
section 7443B or chapters 83 or 84 of title 5, United
States Code'' after ``7447(d)'', and</DELETED>
<DELETED>    (B) by inserting ``or 7443B(m)(1)(B) after
``7447(f)(4)''.</DELETED>
<DELETED>    (8) Section 7448(n) is amended by inserting ``his
years of service pursuant to any appointment under section
7443A,'' after ``of the Tax Court,''.</DELETED>
<DELETED>    (9) Section 3121(b)(5)(E) is amended by inserting
``or magistrate judge'' before ``of the United States Tax
Court''.</DELETED>
<DELETED>    (10) Section 210(a)(5)(E) of the Social Security
Act is amended by inserting ``or magistrate judge'' before ``of
the United States Tax Court''.</DELETED>

<DELETED>SEC. 210. RETIREMENT AND ANNUITY PROGRAM.</DELETED>

<DELETED>    (a) Retirement and Annuity Program.--Part I of subchapter
C of chapter 76 is amended by inserting after section 7443A the
following new section:</DELETED>

<DELETED>``SEC. 7443B. RETIREMENT FOR MAGISTRATE JUDGES OF THE TAX
COURT.</DELETED>

<DELETED>    ``(a) Retirement Based on Years of Service.--A magistrate
judge of the Tax Court to whom this section applies and who retires
from office after attaining the age of 65 years and serving at least 14
years, whether continuously or otherwise, as such magistrate judge
shall, subject to subsection (f), be entitled to receive, during the
remainder of the magistrate judge's lifetime, an annuity equal to the
salary being received at the time the magistrate judge leaves
office.</DELETED>
<DELETED>    ``(b) Retirement Upon Failure of Reappointment.--A
magistrate judge of the Tax Court to whom this section applies who is
not reappointed following the expiration of the term of office of such
magistrate judge, and who retires upon the completion of the term
shall, subject to subsection (f), be entitled to receive, upon
attaining the age of 65 years and during the remainder of such
magistrate judge's lifetime, an annuity equal to that portion of the
salary being received at the time the magistrate judge leaves office
which the aggregate number of years of service, not to exceed 14, bears
to 14, if--</DELETED>
<DELETED>    ``(1) such magistrate judge has served at least 1
full term as a magistrate judge, and</DELETED>
<DELETED>    ``(2) not earlier than 9 months before the date on
which the term of office of such magistrate judge expires, and
not later than 6 months before such date, such magistrate judge
notified the chief judge of the Tax Court in writing that such
magistrate judge was willing to accept reappointment to the
position in which such magistrate judge was serving.</DELETED>
<DELETED>    ``(c) Service of at Least 8 Years.--A magistrate judge of
the Tax Court to whom this section applies and who retires after
serving at least 8 years, whether continuously or otherwise, as such a
magistrate judge shall, subject to subsection (f), be entitled to
receive, upon attaining the age of 65 years and during the remainder of
the magistrate judge's lifetime, an annuity equal to that portion of
the salary being received at the time the magistrate judge leaves
office which the aggregate number of years of service, not to exceed
14, bears to 14. Such annuity shall be reduced by
</DELETED>\<DELETED>1/6</DELETED>\ <DELETED>of 1 percent for each full
month such magistrate judge was under the age of 65 at the time the
magistrate judge left office, except that such reduction shall not
exceed 20 percent.</DELETED>
<DELETED>    ``(d) Retirement for Disability.--A magistrate judge of
the Tax Court to whom this section applies, who has served at least 5
years, whether continuously or otherwise, as such a magistrate judge,
and who retires or is removed from office upon the sole ground of
mental or physical disability shall, subject to subsection (f), be
entitled to receive, during the remainder of the magistrate judge's
lifetime, an annuity equal to 40 percent of the salary being received
at the time of retirement or removal or, in the case of a magistrate
judge who has served for at least 10 years, an amount equal to that
proportion of the salary being received at the time of retirement or
removal which the aggregate number of years of service, not to exceed
14, bears to 14.</DELETED>
<DELETED>    ``(e) Cost-of-Living Adjustments.--A magistrate judge of
the Tax Court who is entitled to an annuity under this section is also
entitled to a cost-of-living adjustment in such annuity, calculated and
payable in the same manner as adjustments under section 8340(b) of
title 5, United States Code, except that any such annuity, as increased
under this subsection, may not exceed the salary then payable for the
position from which the magistrate judge retired or was
removed.</DELETED>
<DELETED>    ``(f) Election; Annuity in Lieu of Other Annuities.--
</DELETED>
<DELETED>    ``(1) In general.--A magistrate judge of the Tax
Court shall be entitled to an annuity under this section if the
magistrate judge elects an annuity under this section by
notifying the chief judge of the Tax Court not later than the
later of--</DELETED>
<DELETED>    ``(A) 5 years after the magistrate judge
of the Tax Court begins judicial service, or</DELETED>
<DELETED>    ``(B) 5 years after the date of the
enactment of this subsection.</DELETED>
<DELETED>Such notice shall be given in accordance with
procedures prescribed by the Tax Court.</DELETED>
<DELETED>    ``(2) Annuity in lieu of other annuity.--A
magistrate judge who elects to receive an annuity under this
section shall not be entitled to receive--</DELETED>
<DELETED>    ``(A) any annuity to which such magistrate
judge would otherwise have been entitled under
subchapter III of chapter 83, or under chapter 84
(except for subchapters III and VII), of title 5,
United States Code, for service performed as a
magistrate or otherwise,</DELETED>
<DELETED>    ``(B) an annuity or salary in senior
status or retirement under section 371 or 372 of title
28, United States Code,</DELETED>
<DELETED>    ``(C) retired pay under section 7447,
or</DELETED>
<DELETED>    ``(D) retired pay under section 7296 of
title 38, United States Code.</DELETED>
<DELETED>    ``(3) Coordination with title 5.--A magistrate
judge of the Tax Court who elects to receive an annuity under
this section--</DELETED>
<DELETED>    ``(A) shall not be subject to deductions
and contributions otherwise required by section 8334(a)
of title 5, United States Code,</DELETED>
<DELETED>    ``(B) shall be excluded from the operation
of chapter 84 (other than subchapters III and VII) of
such title 5, and</DELETED>
<DELETED>    ``(C) is entitled to a lump-sum credit
under section 8342(a) or 8424 of such title 5, as the
case may be.</DELETED>
<DELETED>    ``(g) Calculation of Service.--For purposes of calculating
an annuity under this section--</DELETED>
<DELETED>    ``(1) service as a magistrate judge of the Tax
Court to whom this section applies may be credited,
and</DELETED>
<DELETED>    ``(2) each month of service shall be credited as
</DELETED>\<DELETED>1/12</DELETED>\ <DELETED>of a year, and the
fractional part of any month shall not be credited.</DELETED>
<DELETED>    ``(h) Covered Positions and Service.--This section applies
to any magistrate judge of the Tax Court or special trial judge of the
Tax Court appointed under this subchapter, but only with respect to
service as such a magistrate judge or special trial judge after a date
not earlier than 9</DELETED>\<DELETED>1/2</DELETED>\ <DELETED>years
before the date of the enactment of this subsection.</DELETED>
<DELETED>    ``(i) Payments Pursuant to Court Order.--</DELETED>
<DELETED>    ``(1) In general.--Payments under this section
which would otherwise be made to a magistrate judge of the Tax
Court based upon his or her service shall be paid (in whole or
in part) by the chief judge of the Tax Court to another person
if and to the extent expressly provided for in the terms of any
court decree of divorce, annulment, or legal separation, or the
terms of any court order or court-approved property settlement
agreement incident to any court decree of divorce, annulment,
or legal separation. Any payment under this paragraph to a
person bars recovery by any other person.</DELETED>
<DELETED>    ``(2) Requirements for payment.--Paragraph (1)
shall apply only to payments made by the chief judge of the Tax
Court after the date of receipt by the chief judge of written
notice of such decree, order, or agreement, and such additional
information as the chief judge may prescribe.</DELETED>
<DELETED>    ``(3) Court defined.--For purposes of this
subsection, the term `court' means any court of any State, the
District of Columbia, the Commonwealth of Puerto Rico, Guam,
the Northern Mariana Islands, or the Virgin Islands, and any
Indian tribal court or courts of Indian offense.</DELETED>
<DELETED>    ``(j) Deductions, Contributions, and Deposits.--</DELETED>
<DELETED>    ``(1) Deductions.--Beginning with the next pay
period after the chief judge of the Tax Court receives a notice
under subsection (f) that a magistrate judge of the Tax Court
has elected an annuity under this section, the chief judge
shall deduct and withhold 1 percent of the salary of such
magistrate judge. Amounts shall be so deducted and withheld in
a manner determined by the chief judge. Amounts deducted and
withheld under this subsection shall be deposited in the
Treasury of the United States to the credit of the Tax Court
Judicial Officers' Retirement Fund. Deductions under this
subsection from the salary of a magistrate judge shall
terminate upon the retirement of the magistrate judge or upon
completion of 14 years of service for which contributions under
this section have been made, whether continuously or otherwise,
as calculated under subsection (g), whichever occurs
first.</DELETED>
<DELETED>    ``(2) Consent to deductions; discharge of
claims.--Each magistrate judge of the Tax Court who makes an
election under subsection (f) shall be deemed to consent and
agree to the deductions from salary which are made under
paragraph (1). Payment of such salary less such deductions (and
any deductions made under section 7448) is a full and complete
discharge and acquittance of all claims and demands for all
services rendered by such magistrate judge during the period
covered by such payment, except the right to those benefits to
which the magistrate judge is entitled under this section (and
section 7448).</DELETED>
<DELETED>    ``(k) Deposits for Prior Service.--Each magistrate judge
of the Tax Court who makes an election under subsection (f) may
deposit, for service performed before such election for which
contributions may be made under this section, an amount equal to 1
percent of the salary received for that service. Credit for any period
covered by that service may not be allowed for purposes of an annuity
under this section until a deposit under this subsection has been made
for that period.</DELETED>
<DELETED>    ``(l) Individual Retirement Records.--The amounts deducted
and withheld under subsection (j), and the amounts deposited under
subsection (k), shall be credited to individual accounts in the name of
each magistrate judge of the Tax Court from whom such amounts are
received, for credit to the Tax Court Judicial Officers' Retirement
Fund.</DELETED>
<DELETED>    ``(m) Annuities Affected in Certain Cases.--</DELETED>
<DELETED>    ``(1) 1-year forfeiture for failure to perform
judicial duties.--Subject to paragraph (3), any magistrate
judge of the Tax Court who retires under this section and who
fails to perform judicial duties required of such individual by
section 7443C shall forfeit all rights to an annuity under this
section for a 1-year period which begins on the 1st day on
which such individual fails to perform such duties.</DELETED>
<DELETED>    ``(2) Permanent forfeiture of retired pay where
certain non-government services performed.--Subject to
paragraph (3), any magistrate judge of the Tax Court who
retires under this section and who thereafter performs (or
supervises or directs the performance of) legal or accounting
services in the field of Federal taxation for the individual's
client, the individual's employer, or any of such employer's
clients, shall forfeit all rights to an annuity under this section for
all periods beginning on or after the first day on which the individual
performs (or supervises or directs the performance of) such services.
The preceding sentence shall not apply to any civil office or
employment under the Government of the United States.</DELETED>
<DELETED>    ``(3) Forfeitures not to apply where individual
elects to freeze amount of annuity.--</DELETED>
<DELETED>    ``(A) In general.--If a magistrate judge
of the Tax Court makes an election under this
paragraph--</DELETED>
<DELETED>    ``(i) paragraphs (1) and (2) (and
section 7443C) shall not apply to such
magistrate judge beginning on the date such
election takes effect, and</DELETED>
<DELETED>    ``(ii) the annuity payable under
this section to such magistrate judge, for
periods beginning on or after the date such
election takes effect, shall be equal to the
annuity to which such magistrate judge is
entitled on the day before such effective
date.</DELETED>
<DELETED>    ``(B) Election requirements.--An election
under subparagraph (A)--</DELETED>
<DELETED>    ``(i) may be made by a magistrate
judge of the Tax Court eligible for retirement
under this section, and</DELETED>
<DELETED>    ``(ii) shall be filed with the
chief judge of the Tax Court.</DELETED>
<DELETED>Such an election, once it takes effect, shall
be irrevocable.</DELETED>
<DELETED>    ``(C) Effective date of election.--Any
election under subparagraph (A) shall take effect on
the first day of the first month following the month in
which the election is made.</DELETED>
<DELETED>    ``(4) Accepting other employment.--Any magistrate
judge of the Tax Court who retires under this section and
thereafter accepts compensation for civil office or employment
under the United States Government (other than for the
performance of functions as a magistrate judge of the Tax Court
under section 7443C) shall forfeit all rights to an annuity
under this section for the period for which such compensation
is received. For purposes of this paragraph, the term
`compensation' includes retired pay or salary received in
retired status.</DELETED>
<DELETED>    ``(n) Lump-Sum Payments.--</DELETED>
<DELETED>    ``(1) Eligibility.--</DELETED>
<DELETED>    ``(A) In general.--Subject to paragraph
(2), an individual who serves as a magistrate judge of
the Tax Court and--</DELETED>
<DELETED>    ``(i) who leaves office and is not
reappointed as a magistrate judge of the Tax
Court for at least 31 consecutive
days,</DELETED>
<DELETED>    ``(ii) who files an application
with the chief judge of the Tax Court for
payment of a lump-sum credit,</DELETED>
<DELETED>    ``(iii) is not serving as a
magistrate judge of the Tax Court at the time
of filing of the application, and</DELETED>
<DELETED>    ``(iv) will not become eligible to
receive an annuity under this section within 31
days after filing the application,</DELETED>
<DELETED>is entitled to be paid the lump-sum credit.
Payment of the lump-sum credit voids all rights to an
annuity under this section based on the service on
which the lump-sum credit is based, until that
individual resumes office as a magistrate judge of the
Tax Court.</DELETED>
<DELETED>    ``(B) Payment to survivors.--Lump-sum
benefits authorized by subparagraphs (C), (D), and (E)
of this paragraph shall be paid to the person or
persons surviving the magistrate judge of the Tax Court
and alive on the date title to the payment arises, in
the order of precedence set forth in subsection (o) of
section 376 of title 28, United States Code, and in
accordance with the last 2 sentences of paragraph (1)
of that subsection. For purposes of the preceding
sentence, the term `judicial official' as used in
subsection (o) of such section 376 shall be deemed to
mean `magistrate judge of the Tax Court' and the terms
`Administrative Office of the United States Courts' and
`Director of the Administrative Office of the United
States Courts' shall be deemed to mean `chief judge of
the Tax Court'.</DELETED>
<DELETED>    ``(C) Payment upon death of judge before
receipt of annuity.--If a magistrate judge of the Tax
Court dies before receiving an annuity under this
section, the lump-sum credit shall be paid.</DELETED>
<DELETED>    ``(D) Payment of annuity remainder.--If
all annuity rights under this section based on the
service of a deceased magistrate judge of the Tax Court
terminate before the total annuity paid equals the
lump-sum credit, the difference shall be
paid.</DELETED>
<DELETED>    ``(E) Payment upon death of judge during
receipt of annuity.--If a magistrate judge of the Tax
Court who is receiving an annuity under this section
dies, any accrued annuity benefits remaining unpaid
shall be paid.</DELETED>
<DELETED>    ``(F) Payment upon termination.--Any
accrued annuity benefits remaining unpaid on the
termination, except by death, of the annuity of a
magistrate judge of the Tax Court shall be paid to that
individual.</DELETED>
<DELETED>    ``(G) Payment upon accepting other
employment.--Subject to paragraph (2), a magistrate
judge of the Tax Court who forfeits rights to an
annuity under subsection (m)(4) before the total
annuity paid equals the lump-sum credit shall be
entitled to be paid the difference if the magistrate
judge of the Tax Court files an application with the
chief judge of the Tax Court for payment of that
difference. A payment under this subparagraph voids all
rights to an annuity on which the payment is
based.</DELETED>
<DELETED>    ``(2) Spouses and former spouses.--</DELETED>
<DELETED>    ``(A) In general.--Payment of the lump-sum
credit under paragraph (1)(A) or a payment under
paragraph (1)(G)--</DELETED>
<DELETED>    ``(i) may be made only if any
current spouse and any former spouse of the
magistrate judge of the Tax Court are notified
of the magistrate judge's application,
and</DELETED>
<DELETED>    ``(ii) shall be subject to the
terms of a court decree of divorce, annulment,
or legal separation, or any court or court
approved property settlement agreement incident
to such decree, if--</DELETED>
<DELETED>    ``(I) the decree, order,
or agreement expressly relates to any
portion of the lump-sum credit or other
payment involved, and</DELETED>
<DELETED>    ``(II) payment of the
lump-sum credit or other payment would
extinguish entitlement of the
magistrate judge's spouse or former
spouse to any portion of an annuity
under subsection (i).</DELETED>
<DELETED>    ``(B) Notification.--Notification of a
spouse or former spouse under this paragraph shall be
made in accordance with such procedures as the chief
judge of the Tax Court shall prescribe. The chief judge
may provide under such procedures that subparagraph
(A)(i) may be waived with respect to a spouse or former
spouse if the magistrate judge establishes to the
satisfaction of the chief judge that the whereabouts of
such spouse or former spouse cannot be
determined.</DELETED>
<DELETED>    ``(C) Resolution of 2 or more orders.--The
chief judge shall prescribe procedures under which this
paragraph shall be applied in any case in which the
chief judge receives 2 or more orders or decrees
described in subparagraph (A).</DELETED>
<DELETED>    ``(3) Definition.--For purposes of this
subsection, the term `lump-sum credit' means the unrefunded
amount consisting of--</DELETED>
<DELETED>    ``(A) retirement deductions made under
this section from the salary of a magistrate judge of
the Tax Court,</DELETED>
<DELETED>    ``(B) amounts deposited under subsection
(k) by a magistrate judge of the Tax Court covering
earlier service, and</DELETED>
<DELETED>    ``(C) interest on the deductions and
deposits which, for any calendar year, shall be equal
to the overall average yield to the Tax Court Judicial
Officers' Retirement Fund during the preceding fiscal
year from all obligations purchased by the Secretary
during such fiscal year under subsection (o); but does
not include interest--</DELETED>
<DELETED>    ``(i) if the service covered
thereby aggregates 1 year or less, or</DELETED>
<DELETED>    ``(ii) for the fractional part of
a month in the total service.</DELETED>
<DELETED>    ``(o) Tax Court Judicial Officers' Retirement Fund.--
</DELETED>
<DELETED>    ``(1) Establishment.--There is established in the
Treasury a fund which shall be known as the `Tax Court Judicial
Officers' Retirement Fund'. Amounts in the Fund are authorized
to be appropriated for the payment of annuities, refunds, and
other payments under this section.</DELETED>
<DELETED>    ``(2) Investment of fund.--The Secretary shall
invest, in interest bearing securities of the United States,
such currently available portions of the Tax Court Judicial
Officers' Retirement Fund as are not immediately required for
payments from the Fund. The income derived from these
investments constitutes a part of the Fund.</DELETED>
<DELETED>    ``(3) Unfunded liability.--</DELETED>
<DELETED>    ``(A) In general.--There are authorized to
be appropriated to the Tax Court Judicial Officers'
Retirement Fund amounts required to reduce to zero the
unfunded liability of the Fund.</DELETED>
<DELETED>    ``(B) Unfunded liability.--For purposes of
subparagraph (A), the term `unfunded liability' means
the estimated excess, determined on an annual basis in
accordance with the provisions of section 9503 of title
31, United States Code, of the present value of all
benefits payable from the Tax Court Judicial Officers'
Retirement Fund over the sum of--</DELETED>
<DELETED>    ``(i) the present value of
deductions to be withheld under this section
from the future basic pay of magistrate judges
of the Tax Court, plus</DELETED>
<DELETED>    ``(ii) the balance in the Fund as
of the date the unfunded liability is
determined.</DELETED>
<DELETED>    ``(p) Participation in Thrift Savings Plan.--</DELETED>
<DELETED>    ``(1) Election to contribute.--</DELETED>
<DELETED>    ``(A) In general.--A magistrate judge of
the Tax Court who elects to receive an annuity under
this section or under section 211 of the United States
Tax Court Modernization Act may elect to contribute an
amount of such individual's basic pay to the Thrift
Savings Fund established by section 8437 of title 5,
United States Code.</DELETED>
<DELETED>    ``(B) Period of election.--An election may
be made under this paragraph only during a period
provided under section 8432(b) of title 5, United
States Code, for individuals subject to chapter 84 of
such title.</DELETED>
<DELETED>    ``(2) Applicability of title 5 provisions.--Except
as otherwise provided in this subsection, the provisions of
subchapters III and VII of chapter 84 of title 5, United States
Code, shall apply with respect to a magistrate judge who makes
an election under paragraph (1).</DELETED>
<DELETED>    ``(3) Special rules.--</DELETED>
<DELETED>    ``(A) Amount contributed.--The amount
contributed by a magistrate judge to the Thrift Savings
Fund in any pay period shall not exceed the maximum
percentage of such judge's basic pay for such pay
period as allowable under section 8440f of title 5,
United States Code.</DELETED>
<DELETED>    ``(B) Contributions for benefit of
judge.--No contributions may be made for the benefit of
a magistrate judge under section 8432(c) of title 5,
United States Code.</DELETED>
<DELETED>    ``(C) Applicability of section 8433(b) of
title 5.--Section 8433(b) of title 5, United States
Code, applies with respect to a magistrate judge who
makes an election under paragraph (1) and--</DELETED>
<DELETED>    ``(i) who retires entitled to an
immediate annuity under this section (including
a disability annuity under subsection (d) of
this section) or section 211 of the United
States Tax Court Modernization Act,</DELETED>
<DELETED>    ``(ii) who retires before
attaining age 65 but is entitled, upon
attaining age 65, to an annuity under this
section or section 211 of the United States Tax
Court Modernization Act, or</DELETED>
<DELETED>    ``(iii) who retires before
becoming entitled to an immediate annuity, or
an annuity upon attaining age 65, under this
section or section 211 of the United States Tax
Court Modernization Act.</DELETED>
<DELETED>    ``(D) Separation from service.--With
respect to a magistrate judge to whom this subsection
applies, retirement under this section or section 211
of the United States Tax Court Modernization Act is a
separation from service for purposes of subchapters III
and VII of chapter 84 of title 5, United States
Code.</DELETED>
<DELETED>    ``(4) Definitions.--For purposes of this
subsection, the terms `retirement' and `retire' include removal
from office under section 7443A(a)(2) on the sole ground of
mental or physical disability.</DELETED>
<DELETED>    ``(5) Offset.--In the case of a magistrate judge
who receives a distribution from the Thrift Savings Fund and
who later receives an annuity under this section, that annuity
shall be offset by an amount equal to the amount which
represents the Government's contribution to that person's
Thrift Savings Account, without regard to earnings attributable
to that amount. Where such an offset would exceed 50 percent of
the annuity to be received in the first year, the offset may be
divided equally over the first 2 years in which that person
receives the annuity.</DELETED>
<DELETED>    ``(6) Exception.--Notwithstanding clauses (i) and
(ii) of paragraph (3)(C), if any magistrate judge retires under
circumstances making such magistrate judge eligible to make an
election under subsection (b) of section 8433 of title 5,
United States Code, and such magistrate judge's nonforfeitable
account balance is less than an amount that the Executive
Director of the Office of Personnel Management prescribes by
regulation, the Executive Director shall pay the nonforfeitable
account balance to the participant in a single
payment.''.</DELETED>
<DELETED>    (b) Conforming Amendment.--The table of sections for part
I of subchapter C of chapter 76 is amended by inserting after the item
relating to section 7443A the following new item:</DELETED>

<DELETED>``Sec. 7443B. Retirement for
magistrate judges of the Tax
Court.''.

<DELETED>SEC. 211. INCUMBENT MAGISTRATE JUDGES OF THE TAX
COURT.</DELETED>

<DELETED>    (a) Retirement Annuity Under Title 5 and Section 7443B of
the Internal Revenue Code of 1986.--A magistrate judge of the United
States Tax Court in active service on the date of the enactment of this
Act shall, subject to subsection (b), be entitled, in lieu of the
annuity otherwise provided under the amendments made by this title,
to--</DELETED>
<DELETED>    (1) an annuity under subchapter III of chapter 83,
or under chapter 84 (except for subchapters III and VII), of
title 5, United States Code, as the case may be, for creditable
service before the date on which service would begin to be
credited for purposes of paragraph (2), and</DELETED>
<DELETED>    (2) an annuity calculated under subsection (b) or
(c) and subsection (g) of section 7443B of the Internal Revenue
Code of 1986, as added by this Act, for any service as a
magistrate judge of the United States Tax Court or special
trial judge of the United States Tax Court but only with
respect to service as such a magistrate judge or special trial
judge after a date not earlier than 9</DELETED>\<DELETED>1/
2</DELETED>\ <DELETED>years prior to the date of the enactment
of this Act (as specified in the election pursuant to
subsection (b)) for which deductions and deposits are made
under subsections (j) and (k) of such section 7443B, as
applicable, without regard to the minimum number of years of
service as such a magistrate judge of the United States Tax
Court, except that--</DELETED>
<DELETED>    (A) in the case of a magistrate judge who
retired with less than 8 years of service, the annuity
under subsection (c) of such section 7443B shall be
equal to that proportion of the salary being received
at the time the magistrate judge leaves office which
the years of service bears to 14, subject to a
reduction in accordance with subsection (c) of such section 7443B if
the magistrate judge is under age 65 at the time he or she leaves
office, and</DELETED>
<DELETED>    (B) the aggregate amount of the annuity
initially payable on retirement under this subsection
may not exceed the rate of pay for the magistrate judge
which is in effect on the day before the retirement
becomes effective.</DELETED>
<DELETED>    (b) Filing of Notice of Election.--A magistrate judge of
the United States Tax Court shall be entitled to an annuity under this
section only if the magistrate judge files a notice of that election
with the chief judge of the United States Tax Court specifying the date
on which service would begin to be credited under section 7443B of the
Internal Revenue Code of 1986, as added by this Act, in lieu of chapter
83 or chapter 84 of title 5, United States Code. Such notice shall be
filed in accordance with such procedures as the chief judge of the
United States Tax Court shall prescribe.</DELETED>
<DELETED>    (c) Lump-Sum Credit Under Title 5.--A magistrate judge of
the United States Tax Court who makes an election under subsection (b)
shall be entitled to a lump-sum credit under section 8342 or 8424 of
title 5, United States Code, as the case may be, for any service which
is covered under section 7443B of the Internal Revenue Code of 1986, as
added by this Act, pursuant to that election, and with respect to which
any contributions were made by the magistrate judge under the
applicable provisions of title 5, United States Code.</DELETED>
<DELETED>    (d) Recall.--With respect to any magistrate judge of the
United States Tax Court receiving an annuity under this section who is
recalled to serve under section 7443C of the Internal Revenue Code of
1986, as added by this Act--</DELETED>
<DELETED>    (1) the amount of compensation which such recalled
magistrate judge receives under such section 7443C shall be
calculated on the basis of the annuity received under this
section, and</DELETED>
<DELETED>    (2) such recalled magistrate judge of the United
States Tax Court may serve as a reemployed annuitant to the
extent otherwise permitted under title 5, United States
Code.</DELETED>
<DELETED>Section 7443B(m)(4) of the Internal Revenue Code of 1986, as
added by this Act, shall not apply with respect to service as a
reemployed annuitant described in paragraph (2).</DELETED>

<DELETED>SEC. 212. PROVISIONS FOR RECALL.</DELETED>

<DELETED>    (a) In General.--Part I of subchapter C of chapter 76, as
amended by this Act, is amended by inserting after section 7443B the
following new section:</DELETED>

<DELETED>``SEC. 7443C. RECALL OF MAGISTRATE JUDGES OF THE TAX
COURT.</DELETED>

<DELETED>    ``(a) Recalling of Retired Magistrate Judges.--Any
individual who has retired pursuant to section 7443B or the applicable
provisions of title 5, United States Code, upon reaching the age and
service requirements established therein, may at or after retirement be
called upon by the chief judge of the Tax Court to perform such
judicial duties with the Tax Court as may be requested of such
individual for any period or periods specified by the chief judge;
except that in the case of any such individual--</DELETED>
<DELETED>    ``(1) the aggregate of such periods in any 1
calendar year shall not (without such individual's consent)
exceed 90 calendar days, and</DELETED>
<DELETED>    ``(2) such individual shall be relieved of
performing such duties during any period in which illness or
disability precludes the performance of such duties.</DELETED>
<DELETED>Any act, or failure to act, by an individual performing
judicial duties pursuant to this subsection shall have the same force
and effect as if it were the act (or failure to act) of a magistrate
judge of the Tax Court.</DELETED>
<DELETED>    ``(b) Compensation.--For the year in which a period of
recall occurs, the magistrate judge shall receive, in addition to the
annuity provided under the provisions of section 7443B or under the
applicable provisions of title 5, United States Code, an amount equal
to the difference between that annuity and the current salary of the
office to which the magistrate judge is recalled. The annuity of the
magistrate judge who completes that period of service, who is not
recalled in a subsequent year, and who retired under section 7443B,
shall be equal to the salary in effect at the end of the year in which
the period of recall occurred for the office from which such individual
retired.</DELETED>
<DELETED>    ``(c) Rulemaking Authority.--The provisions of this
section may be implemented under such rules as may be promulgated by
the Tax Court.''.</DELETED>
<DELETED>    (b) Conforming Amendment.--The table of sections for part
I of subchapter C of chapter 76, as amended by this Act, is amended by
inserting after the item relating to section 7443B the following new
item:</DELETED>

<DELETED>``Sec. 7443C. Recall of
magistrate judges of the Tax
Court.''.

<DELETED>SEC. 213. EFFECTIVE DATE.</DELETED>

<DELETED>    Except as otherwise provided, the amendments made by this
title shall take effect on the date of the enactment of this
Act.</DELETED>

SECTION 1. SHORT TITLE; ETC.

(a) Short Title.--This Act may be cited as the ``United States Tax
Court Modernization Act''.
(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) Table of Contents.--The table of contents for this Act is as
follows:

Sec. 1. Short title; etc.

TITLE I--TAX COURT PROCEDURE

Sec. 101. Jurisdiction of Tax Court over collection due process cases.
Sec. 102. Authority for special trial judges to hear and decide certain
employment status cases.
Sec. 103. Confirmation of authority of Tax Court to apply doctrine of
equitable recoupment.
Sec. 104. Tax Court filing fee in all cases commenced by filing
petition.
Sec. 105. Amendments to appoint employees.
Sec. 106. Expanded use of Tax Court practice fee for pro se taxpayers.

TITLE II--TAX COURT PENSION AND COMPENSATION

Sec. 201. Annuities for survivors of Tax Court judges who are
assassinated.
Sec. 202. Cost-of-living adjustments for Tax Court judicial survivor
annuities.
Sec. 203. Life insurance coverage for Tax Court judges.
Sec. 204. Cost of life insurance coverage for Tax Court judges age 65
or over.
Sec. 205. Modification of timing of lump-sum payment of judges' accrued
annual leave.
Sec. 206. Participation of Tax Court judges in the Thrift Savings Plan.
Sec. 207. Exemption of teaching compensation of retired judges from
limitation on outside earned income.
Sec. 208. General provisions relating to magistrate judges of the Tax
Court.
Sec. 209. Annuities to surviving spouses and dependent children of
magistrate judges of the Tax Court.
Sec. 210. Retirement and annuity program.
Sec. 211. Incumbent magistrate judges of the Tax Court.
Sec. 212. Provisions for recall.
Sec. 213. Effective date.

TITLE I--TAX COURT PROCEDURE

SEC. 101. JURISDICTION OF TAX COURT OVER COLLECTION DUE PROCESS CASES.

(a) In General.--Paragraph (1) of section 6330(d) (relating to
proceeding after hearing) is amended to read as follows:
``(1) Judicial review of determination.--The person may,
within 30 days of a determination under this section, appeal
such determination to the Tax Court (and the Tax Court shall
have jurisdiction with respect to such matter).''.
(b) Effective Date.--The amendment made by this section shall apply
to determinations made after the date which is 60 days after the date
of the enactment of this Act.

SEC. 102. AUTHORITY FOR SPECIAL TRIAL JUDGES TO HEAR AND DECIDE CERTAIN
EMPLOYMENT STATUS CASES.

(a) In General.--Section 7443A(b) (relating to proceedings which
may be assigned to special trial judges) is amended by striking ``and''
at the end of paragraph (4), by redesignating paragraph (5) as
paragraph (6), and by inserting after paragraph (4) the following new
paragraph:
``(5) any proceeding under section 7436(c), and''.
(b) Conforming Amendment.--Section 7443A(c) is amended by striking
``or (4)'' and inserting ``(4), or (5)''.
(c) Effective Date.--The amendments made by this section shall
apply to any proceeding under section 7436(c) of the Internal Revenue
Code of 1986 with respect to which a decision has not become final (as
determined under section 7481 of such Code) before the date of the
enactment of this Act.

SEC. 103. CONFIRMATION OF AUTHORITY OF TAX COURT TO APPLY DOCTRINE OF
EQUITABLE RECOUPMENT.

(a) Confirmation of Authority of Tax Court To Apply Doctrine of
Equitable Recoupment.--Section 6214(b) (relating to jurisdiction over
other years and quarters) is amended by adding at the end the following
new sentence: ``Notwithstanding the preceding sentence, the Tax Court
may apply the doctrine of equitable recoupment to the same extent that
it is available in civil tax cases before the district courts of the
United States and the United States Court of Federal Claims.''.
(b) Effective Date.--The amendment made by this section shall apply
to any action or proceeding in the United States Tax Court with respect
to which a decision has not become final (as determined under section
7481 of the Internal Revenue Code of 1986) as of the date of the
enactment of this Act.

SEC. 104. TAX COURT FILING FEE IN ALL CASES COMMENCED BY FILING
PETITION.

(a) In General.--Section 7451 (relating to fee for filing a Tax
Court petition) is amended by striking all that follows ``petition''
and inserting a period.
(b) Effective Date.--The amendment made by this section shall take
effect on the date of the enactment of this Act.

SEC. 105. AMENDMENTS TO APPOINT EMPLOYEES.

(a) In General.--Subsection (a) of section 7471 (relating to Tax
Court employees) is amended to read as follows:
``(a) Appointment and Compensation.--
``(1) Clerk.--The Tax Court may appoint a clerk without
regard to the provisions of title 5, United States Code,
governing appointments in the competitive service. The clerk
shall serve at the pleasure of the Tax Court.
``(2) Law clerks and secretaries.--
``(A) In general.--The judges and special trial
judges of the Tax Court may appoint law clerks and
secretaries, in such numbers as the Tax Court may
approve, without regard to the provisions of title 5,
United States Code, governing appointments in the
competitive service. Any such law clerk or secretary
shall serve at the pleasure of the appointing judge.
``(B) Exemption from federal leave provisions.--A
law clerk appointed under this subsection shall be
exempt from the provisions of subchapter I of chapter
63 of title 5, United States Code. Any unused sick
leave or annual leave standing to the employee's credit
as of the effective date of this subsection shall
remain credited to the employee and shall be available
to the employee upon separation from the Federal
Government.
``(3) Other employees.--The Tax Court may appoint necessary
employees without regard to the provisions of title 5, United
States Code, governing appointments in the competitive service.
Such employees shall be subject to removal by the Tax Court.
``(4) Pay.--The Tax Court may fix and adjust the
compensation for the clerk and other employees of the Tax Court
without regard to the provisions of chapter 51, subchapter III
of chapter 53, or section 5373 of title 5, United States Code.
To the maximum extent feasible, the Tax Court shall compensate
employees at rates consistent with those for employees holding
comparable positions in the judicial branch.
``(5) Programs.--The Tax Court may establish programs for
employee evaluations, incentive awards, flexible work
schedules, premium pay, and resolution of employee grievances.
``(6) Discrimination prohibited.--The Tax Court shall--
``(A) prohibit discrimination on the basis of race,
color, religion, age, sex, national origin, political
affiliation, marital status, or handicapping condition;
and
``(B) promulgate procedures for resolving
complaints of discrimination by employees and
applicants for employment.
``(7) Experts and consultants.--The Tax Court may procure
the services of experts and consultants under section 3109 of
title 5, United States Code.
``(8) Rights to certain appeals reserved.--Notwithstanding
any other provision of law, an individual who is an employee of
the Tax Court on the day before the effective date of this
subsection and who, as of that day, was entitled to--
``(A) appeal a reduction in grade or removal to the
Merit Systems Protection Board under chapter 43 of
title 5, United States Code,
``(B) appeal an adverse action to the Merit Systems
Protection Board under chapter 75 of title 5, United
States Code,
``(C) appeal a prohibited personnel practice
described under section 2302(b) of title 5, United
States Code, to the Merit Systems Protection Board
under chapter 77 of that title,
``(D) make an allegation of a prohibited personnel
practice described under section 2302(b) of title 5,
United States Code, with the Office of Special Counsel
under chapter 12 of that title for action in accordance
with that chapter, or
``(E) file an appeal with the Equal Employment
Opportunity Commission under part 1614 of title 29 of
the Code of Federal Regulations,
shall be entitled to file such appeal or make such an
allegation so long as the individual remains an employee of the
Tax Court.
``(9) Competitive status.--Notwithstanding any other
provision of law, any employee of the Tax Court who has
completed at least 1 year of continuous service under a non-
temporary appointment with the Tax Court acquires a competitive
status for appointment to any position in the competitive
service for which the employee possesses the required
qualifications.
``(10) Merit system principles; prohibited personnel
practices; and preference eligibles.--Any personnel management
system of the Tax Court shall--
``(A) include the principles set forth in section
2301(b) of title 5, United States Code;
``(B) prohibit personnel practices prohibited under
section 2302(b) of title 5, United States Code; and
``(C) in the case of any individual who would be a
preference eligible in the executive branch, the Tax
Court will provide preference for that individual in a
manner and to an extent consistent with preference
accorded to preference eligibles in the executive
branch.''.
(b) Effective Date.--The amendments made by this section shall take
effect on the date the United States Tax Court adopts a personnel
management system after the date of the enactment of this Act.

SEC. 106. EXPANDED USE OF TAX COURT PRACTICE FEE FOR PRO SE TAXPAYERS.

(a) In General.--Section 7475(b) (relating to use of fees) is
amended by inserting before the period at the end ``and to provide
services to pro se taxpayers''.
(b) Effective Date.--The amendment made by this section shall take
effect on the date of the enactment of this Act.

TITLE II--TAX COURT PENSION AND COMPENSATION

SEC. 201. ANNUITIES FOR SURVIVORS OF TAX COURT JUDGES WHO ARE
ASSASSINATED.

(a) Eligibility in Case of Death by Assassination.--Subsection (h)
of section 7448 (relating to annuities to surviving spouses and
dependent children of judges) is amended to read as follows:
``(h) Entitlement to Annuity.--
``(1) In general.--
``(A) Annuity to surviving spouse.--If a judge
described in paragraph (2) is survived by a surviving
spouse but not by a dependent child, there shall be
paid to such surviving spouse an annuity beginning with
the day of the death of the judge or following the
surviving spouse's attainment of the age of 50 years,
whichever is the later, in an amount computed as
provided in subsection (m).
``(B) Annuity to child.--If such a judge is
survived by a surviving spouse and a dependent child or
children, there shall be paid to such surviving spouse
an immediate annuity in an amount computed as provided
in subsection (m), and there shall also be paid to or
on behalf of each such child an immediate annuity equal
to the lesser of--
``(i) 10 percent of the average annual
salary of such judge (determined in accordance
with subsection (m)), or
``(ii) 20 percent of such average annual
salary, divided by the number of such children.
``(C) Annuity to surviving dependent children.--If
such a judge leaves no surviving spouse but leaves a
surviving dependent child or children, there shall be
paid to or on behalf of each such child an immediate
annuity equal to the lesser of--
``(i) 20 percent of the average annual
salary of such judge (determined in accordance
with subsection (m)), or
``(ii) 40 percent of such average annual
salary, divided by the number of such children.
``(2) Covered judges.--Paragraph (1) applies to any judge
electing under subsection (b)--
``(A) who dies while a judge after having rendered
at least 5 years of civilian service computed as
prescribed in subsection (n), for the last 5 years of
which the salary deductions provided for by subsection
(c)(1) or the deposits required by subsection (d) have
actually been made or the salary deductions required by
the civil service retirement laws have actually been
made, or
``(B) who dies by assassination after having
rendered less than 5 years of civilian service computed
as prescribed in subsection (n) if, for the period of
such service, the salary deductions provided for by
subsection (c)(1) or the deposits required by
subsection (d) have actually been made.
``(3) Termination of annuity.--
``(A) In the case of a surviving spouse.--The
annuity payable to a surviving spouse under this
subsection shall be terminable upon such surviving
spouse's death or such surviving spouse's remarriage
before attaining age 55.
``(B) In the case of a child.--The annuity payable
to a child under this subsection shall be terminable
upon (i) the child attaining the age of 18 years, (ii)
the child's marriage, or (iii) the child's death,
whichever first occurs, except that if such child is
incapable of self-support by reason of mental or
physical disability the child's annuity shall be
terminable only upon death, marriage, or recovery from
such disability.
``(C) In the case of a dependent child after death
of surviving spouse.--In case of the death of a
surviving spouse of a judge leaving a dependent child
or children of the judge surviving such spouse, the
annuity of such child or children shall be recomputed
and paid as provided in paragraph (1)(C).
``(D) Recomputation.--In any case in which the
annuity of a dependent child is terminated under this
subsection, the annuities of any remaining dependent
child or children, based upon the service of the same
judge, shall be recomputed and paid as though the child
whose annuity was so terminated had not survived such
judge.
``(4) Special rule for assassinated judges.--In the case of
a survivor or survivors of a judge described in paragraph
(2)(B), there shall be deducted from the annuities otherwise
payable under this section an amount equal to--
``(A) the amount of salary deductions provided for
by subsection (c)(1) that would have been made if such
deductions had been made for 5 years of civilian
service computed as prescribed in subsection (n) before
the judge's death, reduced by
``(B) the amount of such salary deductions that
were actually made before the date of the judge's
death.''.
(b) Definition of Assassination.--Section 7448(a) (relating to
definitions) is amended by adding at the end the following new
paragraph:
``(8) The terms `assassinated' and `assassination' mean the
killing of a judge that is motivated by the performance by that
judge of his or her official duties.''.
(c) Determination of Assassination.--Subsection (i) of section 7448
is amended--
(1) by striking the subsection heading and inserting the
following:
``(i) Determinations by Chief Judge.--
``(1) Dependency and disability.--'',
(2) by moving the text 2 ems to the right, and
(3) by adding at the end the following new paragraph:
``(2) Assassination.--The chief judge shall determine
whether the killing of a judge was an assassination, subject to
review only by the Tax Court. The head of any Federal agency
that investigates the killing of a judge shall provide
information to the chief judge that would assist the chief
judge in making such a determination.''.
(d) Computation of Annuities.--Subsection (m) of section 7448 is
amended--
(1) by striking the subsection heading and inserting the
following:
``(m) Computation of Annuities.--
``(1) In general.--'',
(2) by moving the text 2 ems to the right, and
(3) by adding at the end the following new paragraph:
``(2) Assassinated judges.--In the case of a judge who is
assassinated and who has served less than 3 years, the annuity
of the surviving spouse of such judge shall be based upon the
average annual salary received by such judge for judicial
service.''.
(e) Other Benefits.--Section 7448 is amended by adding at the end
the following:
``(u) Other Benefits.--In the case of a judge who is assassinated,
an annuity shall be paid under this section notwithstanding a
survivor's eligibility for or receipt of benefits under chapter 81 of
title 5, United States Code, except that the annuity for which a
surviving spouse is eligible under this section shall be reduced to the
extent that the total benefits paid under this section and chapter 81
of that title for any year would exceed the current salary for that
year of the office of the judge.''.

SEC. 202. COST-OF-LIVING ADJUSTMENTS FOR TAX COURT JUDICIAL SURVIVOR
ANNUITIES.

(a) In General.--Subsection (s) of section 7448 (relating to
annuities to surviving spouses and dependent children of judges) is
amended to read as follows:
``(s) Increases in Survivor Annuities.--Each time that an increase
is made under section 8340(b) of title 5, United States Code, in
annuities payable under subchapter III of chapter 83 of that title,
each annuity payable from the survivors annuity fund under this section
shall be increased at the same time by the same percentage by which
annuities are increased under such section 8340(b).''.
(b) Effective Date.--The amendments made by this section shall
apply with respect to increases made under section 8340(b) of title 5,
United States Code, in annuities payable under subchapter III of
chapter 83 of that title, taking effect after the date of the enactment
of this Act.

SEC. 203. LIFE INSURANCE COVERAGE FOR TAX COURT JUDGES.

(a) In General.--Section 7447 (relating to retirement of judges) is
amended by adding at the end the following new subsection:
``(j) Life Insurance Coverage.--For purposes of chapter 87
of title 5, United States Code (relating to life insurance),
any individual who is serving as a judge of the Tax Court or
who is retired under this section is deemed to be an employee
who is continuing in active employment.''.
(b) Effective Date.--The amendment made by this section shall apply
to any individual serving as a judge of the United States Tax Court and
to any retired judge of the United States Tax Court on or after the
date of the enactment of this Act.

SEC. 204. COST OF LIFE INSURANCE COVERAGE FOR TAX COURT JUDGES AGE 65
OR OVER.

Section 7472 (relating to expenditures) is amended by inserting
after the first sentence the following new sentence: ``Notwithstanding
any other provision of law, the Tax Court is authorized to pay on
behalf of its judges, age 65 or over, any increase in the cost of
Federal Employees' Group Life Insurance imposed after April 24, 1999,
including any expenses generated by such payments, as authorized by the
chief judge in a manner consistent with such payments authorized by the
Judicial Conference of the United States pursuant to section 604(a)(5)
of title 28, United States Code.''.

SEC. 205. MODIFICATION OF TIMING OF LUMP-SUM PAYMENT OF JUDGES' ACCRUED
ANNUAL LEAVE.

(a) In General.--Section 7443 (relating to membership of the Tax
Court) is amended by adding at the end the following new subsection:
``(h) Lump-Sum Payment of Judges' Accrued Annual Leave.--
Notwithstanding the provisions of sections 5551 and 6301 of title 5,
United States Code, when an individual subject to the leave system
provided in chapter 63 of that title is appointed by the President to
be a judge of the Tax Court, the individual shall be entitled to
receive, upon appointment to the Tax Court, a lump-sum payment from the
Tax Court of the accumulated and accrued current annual leave standing
to the individual's credit as certified by the agency from which the
individual resigned.''.
(b) Effective Date.--The amendment made by this section shall apply
to any judge of the United States Tax Court who has an outstanding
leave balance on the date of the enactment of this Act and to any
individual appointed by the President to serve as a judge of the United
States Tax Court after such date.

SEC. 206. PARTICIPATION OF TAX COURT JUDGES IN THE THRIFT SAVINGS PLAN.

(a) In General.--Section 7447 (relating to retirement of judges),
as amended by this Act, is amended by adding at the end the following
new subsection:
``(k) Thrift Savings Plan.--
``(1) Election to contribute.--
``(A) In general.--A judge of the Tax Court may
elect to contribute to the Thrift Savings Fund
established by section 8437 of title 5, United States
Code.
``(B) Period of election.--An election may be made
under this paragraph as provided under section 8432(b)
of title 5, United States Code, for individuals subject
to chapter 84 of such title.
``(2) Applicability of title 5 provisions.--Except as
otherwise provided in this subsection, the provisions of
subchapters III and VII of chapter 84 of title 5, United States
Code, shall apply with respect to a judge who makes an election
under paragraph (1).
``(3) Special rules.--
``(A) Amount contributed.--The amount contributed
by a judge to the Thrift Savings Fund in any pay period
shall not exceed the maximum percentage of such judge's
basic pay for such period as allowable under section
8440f of title 5, United States Code. Basic pay does
not include any retired pay paid pursuant to this
section.
``(B) Contributions for benefit of judge.--No
contributions may be made for the benefit of a judge
under section 8432(c) of title 5, United States Code.
``(C) Applicability of section 8433(b) of title 5
whether or not judge retires.--Section 8433(b) of title
5, United States Code, applies with respect to a judge
who makes an election under paragraph (1) and who
either--
``(i) retires under subsection (b), or
``(ii) ceases to serve as a judge of the
Tax Court but does not retire under subsection
(b).
Retirement under subsection (b) is a separation from
service for purposes of subchapters III and VII of
chapter 84 of that title.
``(D) Applicability of section 8351(b)(5) of title
5.--The provisions of section 8351(b)(5) of title 5,
United States Code, shall apply with respect to a judge
who makes an election under paragraph (1).
``(E) Exception.--Notwithstanding subparagraph (C),
if any judge retires under this section, or resigns
without having met the age and service requirements set
forth under subsection (b)(2), and such judge's
nonforfeitable account balance is less than an amount
that the Executive Director of the Office of Personnel
Management prescribes by regulation, the Executive
Director shall pay the nonforfeitable account balance
to the participant in a single payment.''.
(b) Effective Date.--The amendment made by this section shall take
effect on the date of the enactment of this Act.

SEC. 207. EXEMPTION OF TEACHING COMPENSATION OF RETIRED JUDGES FROM
LIMITATION ON OUTSIDE EARNED INCOME.

(a) In General.--Section 7447 (relating to retirement of judges),
as amended by this Act, is amended by adding at the end the following
new subsection:
``(l) Teaching Compensation of Retired Judges.--For purposes of the
limitation under section 501(a) of the Ethics in Government Act of 1978
(5 U.S.C. App.), any compensation for teaching approved under section
502(a)(5) of such Act shall not be treated as outside earned income
when received by a judge of the Tax Court who has retired under
subsection (b) for teaching performed during any calendar year for
which such a judge has met the requirements of subsection (c), as
certified by the chief judge of the Tax Court.''.
(b) Effective Date.--The amendment made by this section shall apply
to any individual serving as a retired judge of the United States Tax
Court on or after the date of the enactment of this Act.

SEC. 208. GENERAL PROVISIONS RELATING TO MAGISTRATE JUDGES OF THE TAX
COURT.

(a) Title of Special Trial Judge Changed to Magistrate Judge of the
Tax Court.--The heading of section 7443A is amended to read as follows:

``SEC. 7443A. MAGISTRATE JUDGES OF THE TAX COURT.''.

(b) Appointment, Tenure, and Removal.--Subsection (a) of section
7443A is amended to read as follows:
``(a) Appointment, Tenure, and Removal.--
``(1) Appointment.--The chief judge may, from time to time,
appoint and reappoint magistrate judges of the Tax Court for a
term of 8 years. The magistrate judges of the Tax Court shall
proceed under such rules as may be promulgated by the Tax
Court.
``(2) Removal.--Removal of a magistrate judge of the Tax
Court during the term for which he or she is appointed shall be
only for incompetency, misconduct, neglect of duty, or physical
or mental disability, but the office of a magistrate judge of
the Tax Court shall be terminated if the judges of the Tax
Court determine that the services performed by the magistrate
judge of the Tax Court are no longer needed. Removal shall not
occur unless a majority of all the judges of the Tax Court
concur in the order of removal. Before any order of removal
shall be entered, a full specification of the charges shall be
furnished to the magistrate judge of the Tax Court, and he or
she shall be accorded by the judges of the Tax Court an
opportunity to be heard on the charges.''.
(c) Salary.--Section 7443A(d) (relating to salary) is amended by
striking ``90'' and inserting ``92''.
(d) Exemption From Federal Leave Provisions.--Section 7443A is
amended by adding at the end the following new subsection:
``(f) Exemption From Federal Leave Provisions.--
``(1) In general.--A magistrate judge of the Tax Court
appointed under this section shall be exempt from the
provisions of subchapter I of chapter 63 of title 5, United
States Code.
``(2) Treatment of unused leave.--
``(A) After service as magistrate judge.--If an
individual who is exempted under paragraph (1) from the
subchapter referred to in such paragraph was previously
subject to such subchapter and, without a break
in service, again becomes subject to such subchapter on completion of
the individual's service as a magistrate judge, the unused annual leave
and sick leave standing to the individual's credit when such individual
was exempted from this subchapter is deemed to have remained to the
individual's credit.
``(B) Computation of annuity.--In computing an
annuity under section 8339 of title 5, United States
Code, the total service of an individual specified in
subparagraph (A) who retires on an immediate annuity or
dies leaving a survivor or survivors entitled to an
annuity includes, without regard to the limitations
imposed by subsection (f) of such section 8339, the
days of unused sick leave standing to the individual's
credit when such individual was exempted from
subchapter I of chapter 63 of title 5, United States
Code, except that these days will not be counted in
determining average pay or annuity eligibility.
``(C) Lump sum payment.--Any accumulated and
current accrued annual leave or vacation balances
credited to a magistrate judge as of the date of the
enactment of this subsection shall be paid in a lump
sum at the time of separation from service pursuant to
the provisions and restrictions set forth in section
5551 of title 5, United States Code, and related
provisions referred to in such section.''.
(e) Conforming Amendments.--
(1) The heading of subsection (b) of section 7443A is
amended by striking ``Special Trial Judges'' and inserting
``Magistrate Judges of the Tax Court''.
(2) Section 7443A(b) is amended by striking ``special trial
judges of the court'' and inserting ``magistrate judges of the
Tax Court''.
(3) Subsections (c) and (d) of section 7443A are amended by
striking ``special trial judge'' and inserting ``magistrate
judge of the Tax Court'' each place it appears.
(4) Section 7443A(e) is amended by striking ``special trial
judges'' and inserting ``magistrate judges of the Tax Court''.
(5) Section 7456(a) is amended by striking ``special trial
judge'' each place it appears and inserting ``magistrate
judge''.
(6) Subsection (c) of section 7471 is amended--
(A) by striking the subsection heading and
inserting ``Magistrate Judges of the Tax Court.--'',
and
(B) by striking ``special trial judges'' and
inserting ``magistrate judges''.

SEC. 209. ANNUITIES TO SURVIVING SPOUSES AND DEPENDENT CHILDREN OF
MAGISTRATE JUDGES OF THE TAX COURT.

(a) Definitions.--Section 7448(a) (relating to definitions), as
amended by this Act, is amended by redesignating paragraphs (5), (6),
(7), and (8) as paragraphs (7), (8), (9), and (10), respectively, and
by inserting after paragraph (4) the following new paragraphs:
``(5) The term `magistrate judge' means a judicial officer
appointed pursuant to section 7443A, including any individual
receiving an annuity under section 7443B, or chapters 83 or 84,
as the case may be, of title 5, United States Code, whether or
not performing judicial duties under section 7443C.
``(6) The term `magistrate judge's salary' means the salary
of a magistrate judge received under section 7443A(d), any
amount received as an annuity under section 7443B, or chapters
83 or 84, as the case may be, of title 5, United States Code,
and compensation received under section 7443C.''.
(b) Election.--Subsection (b) of section 7448 (relating to
annuities to surviving spouses and dependent children of judges) is
amended--
(1) by striking the subsection heading and inserting the
following:
``(b) Election.--
``(1) Judges.--'',
(2) by moving the text 2 ems to the right, and
(3) by adding at the end the following new paragraph:
``(2) Magistrate judges.--Any magistrate judge may by
written election filed with the chief judge bring himself or
herself within the purview of this section. Such election shall
be filed not later than the later of 6 months after--
``(A) 6 months after the date of the enactment of
this paragraph,
``(B) the date the judge takes office, or
``(C) the date the judge marries.''.
(c) Conforming Amendments.--
(1) The heading of section 7448 is amended by inserting
``and magistrate judges'' after ``judges''.
(2) The item relating to section 7448 in the table of
sections for part I of subchapter C of chapter 76 is amended by
inserting ``and magistrate judges'' after ``judges''.
(3) Subsections (c)(1), (d), (f), (g), (h), (j), (m), (n),
and (u) of section 7448, as amended by this Act, are each
amended--
(A) by inserting ``or magistrate judge'' after
``judge'' each place it appears other than in the
phrase ``chief judge'', and
(B) by inserting ``or magistrate judge's'' after
``judge's'' each place it appears.
(4) Section 7448(c) is amended--
(A) in paragraph (1), by striking ``Tax Court
judges'' and inserting ``Tax Court judicial officers'',
(B) in paragraph (2)--
(i) in subparagraph (A), by inserting ``and
section 7443A(d)'' after ``(a)(4)'', and
(ii) in subparagraph (B), by striking
``subsection (a)(4)'' and inserting
``subsections (a)(4) and (a)(6)''.
(5) Section 7448(g) is amended by inserting ``or section
7443B'' after ``section 7447'' each place it appears, and by
inserting ``or an annuity'' after ``retired pay''.
(6) Section 7448(j)(1) is amended--
(A) in subparagraph (A), by striking ``service or
retired'' and inserting ``service, retired'', and by
inserting ``, or receiving any annuity under section
7443B or chapters 83 or 84 of title 5, United States
Code,'' after ``section 7447'', and
(B) in the last sentence, by striking ``subsections
(a)(6) and (7)'' and inserting ``paragraphs (8) and (9)
of subsection (a)''.
(7) Section 7448(m)(1), as amended by this Act, is
amended--
(A) by inserting ``or any annuity under section
7443B or chapters 83 or 84 of title 5, United States
Code'' after ``7447(d)'', and
(B) by inserting ``or 7443B(m)(1)(B) after
``7447(f)(4)''.
(8) Section 7448(n) is amended by inserting ``his years of
service pursuant to any appointment under section 7443A,''
after ``of the Tax Court,''.
(9) Section 3121(b)(5)(E) is amended by inserting ``or
magistrate judge'' before ``of the United States Tax Court''.
(10) Section 210(a)(5)(E) of the Social Security Act is
amended by inserting ``or magistrate judge'' before ``of the
United States Tax Court''.

SEC. 210. RETIREMENT AND ANNUITY PROGRAM.

(a) Retirement and Annuity Program.--Part I of subchapter C of
chapter 76 is amended by inserting after section 7443A the following
new section:

``SEC. 7443B. RETIREMENT FOR MAGISTRATE JUDGES OF THE TAX COURT.

``(a) Retirement Based on Years of Service.--A magistrate judge of
the Tax Court to whom this section applies and who retires from office
after attaining the age of 65 years and serving at least 14 years,
whether continuously or otherwise, as such magistrate judge shall,
subject to subsection (f), be entitled to receive, during the remainder
of the magistrate judge's lifetime, an annuity equal to the salary
being received at the time the magistrate judge leaves office.
``(b) Retirement Upon Failure of Reappointment.--A magistrate judge
of the Tax Court to whom this section applies who is not reappointed
following the expiration of the term of office of such magistrate
judge, and who retires upon the completion of the term shall, subject
to subsection (f), be entitled to receive, upon attaining the age of 65
years and during the remainder of such magistrate judge's lifetime, an
annuity equal to that portion of the salary being received at the time
the magistrate judge leaves office which the aggregate number of years
of service, not to exceed 14, bears to 14, if--
``(1) such magistrate judge has served at least 1 full term
as a magistrate judge, and
``(2) not earlier than 9 months before the date on which
the term of office of such magistrate judge expires, and not
later than 6 months before such date, such magistrate judge
notified the chief judge of the Tax Court in writing that such
magistrate judge was willing to accept reappointment to the
position in which such magistrate judge was serving.
``(c) Service of at Least 8 Years.--A magistrate judge of the Tax
Court to whom this section applies and who retires after serving at
least 8 years, whether continuously or otherwise, as such a magistrate
judge shall, subject to subsection (f), be entitled to receive, upon
attaining the age of 65 years and during the remainder of the
magistrate judge's lifetime, an annuity equal to that portion of the
salary being received at the time the magistrate judge leaves office
which the aggregate number of years of service, not to exceed 14, bears
to 14. Such annuity shall be reduced by \1/6\ of 1 percent for each
full month such magistrate judge was under the age of 65 at the time
the magistrate judge left office, except that such reduction shall not
exceed 20 percent.
``(d) Retirement for Disability.--A magistrate judge of the Tax
Court to whom this section applies, who has served at least 5 years,
whether continuously or otherwise, as such a magistrate judge, and who
retires or is removed from office upon the sole ground of mental or
physical disability shall, subject to subsection (f), be entitled to
receive, during the remainder of the magistrate judge's lifetime, an
annuity equal to 40 percent of the salary being received at the time of
retirement or removal or, in the case of a magistrate judge who has
served for at least 10 years, an amount equal to that proportion of the
salary being received at the time of retirement or removal which the
aggregate number of years of service, not to exceed 14, bears to 14.
``(e) Cost-of-Living Adjustments.--A magistrate judge of the Tax
Court who is entitled to an annuity under this section is also entitled
to a cost-of-living adjustment in such annuity, calculated and payable
in the same manner as adjustments under section 8340(b) of title 5,
United States Code, except that any such annuity, as increased under
this subsection, may not exceed the salary then payable for the
position from which the magistrate judge retired or was removed.
``(f) Election; Annuity in Lieu of Other Annuities.--
``(1) In general.--A magistrate judge of the Tax Court
shall be entitled to an annuity under this section if the
magistrate judge elects an annuity under this section by
notifying the chief judge of the Tax Court not later than the
later of--
``(A) 5 years after the magistrate judge of the Tax
Court begins judicial service, or
``(B) 5 years after the date of the enactment of
this subsection.
Such notice shall be given in accordance with procedures
prescribed by the Tax Court.
``(2) Annuity in lieu of other annuity.--A magistrate judge
who elects to receive an annuity under this section shall not
be entitled to receive--
``(A) any annuity to which such magistrate judge
would otherwise have been entitled under subchapter III
of chapter 83, or under chapter 84 (except for
subchapters III and VII), of title 5, United States
Code, for service performed as a magistrate or
otherwise,
``(B) an annuity or salary in senior status or
retirement under section 371 or 372 of title 28, United
States Code,
``(C) retired pay under section 7447, or
``(D) retired pay under section 7296 of title 38,
United States Code.
``(3) Coordination with title 5.--A magistrate judge of the
Tax Court who elects to receive an annuity under this section--
``(A) shall not be subject to deductions and
contributions otherwise required by section 8334(a) of
title 5, United States Code,
``(B) shall be excluded from the operation of
chapter 84 (other than subchapters III and VII) of such
title 5, and
``(C) is entitled to a lump-sum credit under
section 8342(a) or 8424 of such title 5, as the case
may be.
``(g) Calculation of Service.--For purposes of calculating an
annuity under this section--
``(1) service as a magistrate judge of the Tax Court to
whom this section applies may be credited, and
``(2) each month of service shall be credited as \1/12\ of
a year, and the fractional part of any month shall not be
credited.
``(h) Covered Positions and Service.--This section applies to any
magistrate judge of the Tax Court or special trial judge of the Tax
Court appointed under this subchapter, but only with respect to service
as such a magistrate judge or special trial judge after a date not
earlier than 9\1/2\ years before the date of the enactment of this
subsection.
``(i) Payments Pursuant to Court Order.--
``(1) In general.--Payments under this section which would
otherwise be made to a magistrate judge of the Tax Court based
upon his or her service shall be paid (in whole or in part) by
the chief judge of the Tax Court to another person if and to
the extent expressly provided for in the terms of any court
decree of divorce, annulment, or legal separation, or the terms
of any court order or court-approved property settlement
agreement incident to any court decree of divorce, annulment,
or legal separation. Any payment under this paragraph to a
person bars recovery by any other person.
``(2) Requirements for payment.--Paragraph (1) shall apply
only to payments made by the chief judge of the Tax Court after
the date of receipt by the chief judge of written notice of
such decree, order, or agreement, and such additional
information as the chief judge may prescribe.
``(3) Court defined.--For purposes of this subsection, the
term `court' means any court of any State, the District of
Columbia, the Commonwealth of Puerto Rico, Guam, the Northern
Mariana Islands, or the Virgin Islands, and any Indian tribal
court or courts of Indian offense.
``(j) Deductions, Contributions, and Deposits.--
``(1) Deductions.--Beginning with the next pay period after
the chief judge of the Tax Court receives a notice under
subsection (f) that a magistrate judge of the Tax Court has
elected an annuity under this section, the chief judge shall
deduct and withhold 1 percent of the salary of such magistrate
judge. Amounts shall be so deducted and withheld in a manner
determined by the chief judge. Amounts deducted and withheld
under this subsection shall be deposited in the Treasury of the
United States to the credit of the Tax Court Judicial Officers'
Retirement Fund. Deductions under this subsection from the
salary of a magistrate judge shall terminate upon the
retirement of the magistrate judge or upon completion of 14
years of service for which contributions under this section
have been made, whether continuously or otherwise, as
calculated under subsection (g), whichever occurs first.
``(2) Consent to deductions; discharge of claims.--Each
magistrate judge of the Tax Court who makes an election under
subsection (f) shall be deemed to consent and agree to the
deductions from salary which are made under paragraph (1).
Payment of such salary less such deductions (and any deductions
made under section 7448) is a full and complete discharge and
acquittance of all claims and demands for all services rendered
by such magistrate judge during the period covered by such
payment, except the right to those benefits to which the
magistrate judge is entitled under this section (and section
7448).
``(k) Deposits for Prior Service.--Each magistrate judge of the Tax
Court who makes an election under subsection (f) may deposit, for
service performed before such election for which contributions may be
made under this section, an amount equal to 1 percent of the salary
received for that service. Credit for any period covered by that
service may not be allowed for purposes of an annuity under this
section until a deposit under this subsection has been made for that
period.
``(l) Individual Retirement Records.--The amounts deducted and
withheld under subsection (j), and the amounts deposited under
subsection (k), shall be credited to individual accounts in the name of
each magistrate judge of the Tax Court from whom such amounts are
received, for credit to the Tax Court Judicial Officers' Retirement
Fund.
``(m) Annuities Affected in Certain Cases.--
``(1) 1-year forfeiture for failure to perform judicial
duties.--Subject to paragraph (3), any magistrate judge of the
Tax Court who retires under this section and who fails to
perform judicial duties required of such individual by section
7443C shall forfeit all rights to an annuity under this section
for a 1-year period which begins on the 1st day on which such
individual fails to perform such duties.
``(2) Permanent forfeiture of retired pay where certain
non-government services performed.--Subject to paragraph (3),
any magistrate judge of the Tax Court who retires under this
section and who thereafter performs (or supervises or directs
the performance of) legal or accounting services in the field
of Federal taxation for the individual's client, the
individual's employer, or any of such employer's clients, shall
forfeit all rights to an annuity under this section for all periods
beginning on or after the first day on which the individual performs
(or supervises or directs the performance of) such services. The
preceding sentence shall not apply to any civil office or employment
under the Government of the United States.
``(3) Forfeitures not to apply where individual elects to
freeze amount of annuity.--
``(A) In general.--If a magistrate judge of the Tax
Court makes an election under this paragraph--
``(i) paragraphs (1) and (2) (and section
7443C) shall not apply to such magistrate judge
beginning on the date such election takes
effect, and
``(ii) the annuity payable under this
section to such magistrate judge, for periods
beginning on or after the date such election
takes effect, shall be equal to the annuity to
which such magistrate judge is entitled on the
day before such effective date.
``(B) Election requirements.--An election under
subparagraph (A)--
``(i) may be made by a magistrate judge of
the Tax Court eligible for retirement under
this section, and
``(ii) shall be filed with the chief judge
of the Tax Court.
Such an election, once it takes effect, shall be
irrevocable.
``(C) Effective date of election.--Any election
under subparagraph (A) shall take effect on the first
day of the first month following the month in which the
election is made.
``(4) Accepting other employment.--Any magistrate judge of
the Tax Court who retires under this section and thereafter
accepts compensation for civil office or employment under the
United States Government (other than for the performance of
functions as a magistrate judge of the Tax Court under section
7443C) shall forfeit all rights to an annuity under this
section for the period for which such compensation is received.
For purposes of this paragraph, the term `compensation'
includes retired pay or salary received in retired status.
``(n) Lump-Sum Payments.--
``(1) Eligibility.--
``(A) In general.--Subject to paragraph (2), an
individual who serves as a magistrate judge of the Tax
Court and--
``(i) who leaves office and is not
reappointed as a magistrate judge of the Tax
Court for at least 31 consecutive days,
``(ii) who files an application with the
chief judge of the Tax Court for payment of a
lump-sum credit,
``(iii) is not serving as a magistrate
judge of the Tax Court at the time of filing of
the application, and
``(iv) will not become eligible to receive
an annuity under this section within 31 days
after filing the application,
is entitled to be paid the lump-sum credit. Payment of
the lump-sum credit voids all rights to an annuity
under this section based on the service on which the
lump-sum credit is based, until that individual resumes
office as a magistrate judge of the Tax Court.
``(B) Payment to survivors.--Lump-sum benefits
authorized by subparagraphs (C), (D), and (E) of this
paragraph shall be paid to the person or persons
surviving the magistrate judge of the Tax Court and
alive on the date title to the payment arises, in the
order of precedence set forth in subsection (o) of
section 376 of title 28, United States Code, and in
accordance with the last 2 sentences of paragraph (1)
of that subsection. For purposes of the preceding
sentence, the term `judicial official' as used in
subsection (o) of such section 376 shall be deemed to
mean `magistrate judge of the Tax Court' and the terms
`Administrative Office of the United States Courts' and
`Director of the Administrative Office of the United
States Courts' shall be deemed to mean `chief judge of
the Tax Court'.
``(C) Payment upon death of judge before receipt of
annuity.--If a magistrate judge of the Tax Court dies
before receiving an annuity under this section, the
lump-sum credit shall be paid.
``(D) Payment of annuity remainder.--If all annuity
rights under this section based on the service of a
deceased magistrate judge of the Tax Court terminate
before the total annuity paid equals the lump-sum
credit, the difference shall be paid.
``(E) Payment upon death of judge during receipt of
annuity.--If a magistrate judge of the Tax Court who is
receiving an annuity under this section dies, any
accrued annuity benefits remaining unpaid shall be
paid.
``(F) Payment upon termination.--Any accrued
annuity benefits remaining unpaid on the termination,
except by death, of the annuity of a magistrate judge
of the Tax Court shall be paid to that individual.
``(G) Payment upon accepting other employment.--
Subject to paragraph (2), a magistrate judge of the Tax
Court who forfeits rights to an annuity under
subsection (m)(4) before the total annuity paid equals
the lump-sum credit shall be entitled to be paid the
difference if the magistrate judge of the Tax Court
files an application with the chief judge of the Tax
Court for payment of that difference. A payment under
this subparagraph voids all rights to an annuity on
which the payment is based.
``(2) Spouses and former spouses.--
``(A) In general.--Payment of the lump-sum credit
under paragraph (1)(A) or a payment under paragraph
(1)(G)--
``(i) may be made only if any current
spouse and any former spouse of the magistrate
judge of the Tax Court are notified of the
magistrate judge's application, and
``(ii) shall be subject to the terms of a
court decree of divorce, annulment, or legal
separation, or any court or court approved
property settlement agreement incident to such
decree, if--
``(I) the decree, order, or
agreement expressly relates to any
portion of the lump-sum credit or other
payment involved, and
``(II) payment of the lump-sum
credit or other payment would
extinguish entitlement of the
magistrate judge's spouse or former
spouse to any portion of an annuity
under subsection (i).
``(B) Notification.--Notification of a spouse or
former spouse under this paragraph shall be made in
accordance with such procedures as the chief judge of
the Tax Court shall prescribe. The chief judge may
provide under such procedures that subparagraph (A)(i)
may be waived with respect to a spouse or former spouse
if the magistrate judge establishes to the satisfaction
of the chief judge that the whereabouts of such spouse
or former spouse cannot be determined.
``(C) Resolution of 2 or more orders.--The chief
judge shall prescribe procedures under which this
paragraph shall be applied in any case in which the
chief judge receives 2 or more orders or decrees
described in subparagraph (A).
``(3) Definition.--For purposes of this subsection, the
term `lump-sum credit' means the unrefunded amount consisting
of--
``(A) retirement deductions made under this section
from the salary of a magistrate judge of the Tax Court,
``(B) amounts deposited under subsection (k) by a
magistrate judge of the Tax Court covering earlier
service, and
``(C) interest on the deductions and deposits
which, for any calendar year, shall be equal to the
overall average yield to the Tax Court Judicial
Officers' Retirement Fund during the preceding fiscal
year from all obligations purchased by the Secretary
during such fiscal year under subsection (o); but does
not include interest--
``(i) if the service covered thereby
aggregates 1 year or less, or
``(ii) for the fractional part of a month
in the total service.
``(o) Tax Court Judicial Officers' Retirement Fund.--
``(1) Establishment.--There is established in the Treasury
a fund which shall be known as the `Tax Court Judicial
Officers' Retirement Fund'. Amounts in the Fund are authorized
to be appropriated for the payment of annuities, refunds, and
other payments under this section.
``(2) Investment of fund.--The Secretary shall invest, in
interest bearing securities of the United States, such
currently available portions of the Tax Court Judicial
Officers' Retirement Fund as are not immediately required for
payments from the Fund. The income derived from these
investments constitutes a part of the Fund.
``(3) Unfunded liability.--
``(A) In general.--There are authorized to be
appropriated to the Tax Court Judicial Officers'
Retirement Fund amounts required to reduce to zero the
unfunded liability of the Fund.
``(B) Unfunded liability.--For purposes of
subparagraph (A), the term `unfunded liability' means
the estimated excess, determined on an annual basis in
accordance with the provisions of section 9503 of title
31, United States Code, of the present value of all
benefits payable from the Tax Court Judicial Officers'
Retirement Fund over the sum of--
``(i) the present value of deductions to be
withheld under this section from the future
basic pay of magistrate judges of the Tax
Court, plus
``(ii) the balance in the Fund as of the
date the unfunded liability is determined.
``(p) Participation in Thrift Savings Plan.--
``(1) Election to contribute.--
``(A) In general.--A magistrate judge of the Tax
Court who elects to receive an annuity under this
section or under section 211 of the United States Tax
Court Modernization Act may elect to contribute an
amount of such individual's basic pay to the Thrift
Savings Fund established by section 8437 of title 5,
United States Code.
``(B) Period of election.--An election may be made
under this paragraph as provided under section 8432(b)
of title 5, United States Code, for individuals subject
to chapter 84 of such title.
``(2) Applicability of title 5 provisions.--Except as
otherwise provided in this subsection, the provisions of
subchapters III and VII of chapter 84 of title 5, United States
Code, shall apply with respect to a magistrate judge who makes
an election under paragraph (1).
``(3) Special rules.--
``(A) Amount contributed.--The amount contributed
by a magistrate judge to the Thrift Savings Fund in any
pay period shall not exceed the maximum percentage of
such judge's basic pay for such pay period as allowable
under section 8440f of title 5, United States Code.
``(B) Contributions for benefit of judge.--No
contributions may be made for the benefit of a
magistrate judge under section 8432(c) of title 5,
United States Code.
``(C) Applicability of section 8433(b) of title
5.--Section 8433(b) of title 5, United States Code,
applies with respect to a magistrate judge who makes an
election under paragraph (1) and--
``(i) who retires entitled to an immediate
annuity under this section (including a
disability annuity under subsection (d) of this
section) or section 211 of the United States
Tax Court Modernization Act,
``(ii) who retires before attaining age 65
but is entitled, upon attaining age 65, to an
annuity under this section or section 211 of
the United States Tax Court Modernization Act,
or
``(iii) who retires before becoming
entitled to an immediate annuity, or an annuity
upon attaining age 65, under this section or
section 211 of the United States Tax Court
Modernization Act.
``(D) Separation from service.--With respect to a
magistrate judge to whom this subsection applies,
retirement under this section or section 211 of the
United States Tax Court Modernization Act is a
separation from service for purposes of subchapters III
and VII of chapter 84 of title 5, United States Code.
``(4) Definitions.--For purposes of this subsection, the
terms `retirement' and `retire' include removal from office
under section 7443A(a)(2) on the sole ground of mental or
physical disability.
``(5) Offset.--In the case of a magistrate judge who
receives a distribution from the Thrift Savings Fund and who
later receives an annuity under this section, that annuity
shall be offset by an amount equal to the amount which
represents the Government's contribution to that person's
Thrift Savings Account, without regard to earnings attributable
to that amount. Where such an offset would exceed 50 percent of
the annuity to be received in the first year, the offset may be
divided equally over the first 2 years in which that person
receives the annuity.
``(6) Exception.--Notwithstanding clauses (i) and (ii) of
paragraph (3)(C), if any magistrate judge retires under
circumstances making such magistrate judge eligible to make an
election under subsection (b) of section 8433 of title 5,
United States Code, and such magistrate judge's nonforfeitable
account balance is less than an amount that the Executive
Director of the Office of Personnel Management prescribes by
regulation, the Executive Director shall pay the nonforfeitable
account balance to the participant in a single payment.''.
(b) Conforming Amendment.--The table of sections for part I of
subchapter C of chapter 76 is amended by inserting after the item
relating to section 7443A the following new item:

``Sec. 7443B. Retirement for magistrate
judges of the Tax Court.''.

SEC. 211. INCUMBENT MAGISTRATE JUDGES OF THE TAX COURT.

(a) Retirement Annuity Under Title 5 and Section 7443B of the
Internal Revenue Code of 1986.--A magistrate judge of the United States
Tax Court in active service on the date of the enactment of this Act
shall, subject to subsection (b), be entitled, in lieu of the annuity
otherwise provided under the amendments made by this title, to--
(1) an annuity under subchapter III of chapter 83, or under
chapter 84 (except for subchapters III and VII), of title 5,
United States Code, as the case may be, for creditable service
before the date on which service would begin to be credited for
purposes of paragraph (2), and
(2) an annuity calculated under subsection (b) or (c) and
subsection (g) of section 7443B of the Internal Revenue Code of
1986, as added by this Act, for any service as a magistrate
judge of the United States Tax Court or special trial judge of
the United States Tax Court but only with respect to service as
such a magistrate judge or special trial judge after a date not
earlier than 9\1/2\ years prior to the date of the enactment of
this Act (as specified in the election pursuant to subsection
(b)) for which deductions and deposits are made under
subsections (j) and (k) of such section 7443B, as applicable,
without regard to the minimum number of years of service as
such a magistrate judge of the United States Tax Court, except
that--
(A) in the case of a magistrate judge who retired
with less than 8 years of service, the annuity under
subsection (c) of such section 7443B shall be equal to
that proportion of the salary being received at the
time the magistrate judge leaves office which the years
of service bears to 14, subject to a reduction in
accordance with subsection (c) of such section 7443B if the magistrate
judge is under age 65 at the time he or she leaves office, and
(B) the aggregate amount of the annuity initially
payable on retirement under this subsection may not
exceed the rate of pay for the magistrate judge which
is in effect on the day before the retirement becomes
effective.
(b) Filing of Notice of Election.--A magistrate judge of the United
States Tax Court shall be entitled to an annuity under this section
only if the magistrate judge files a notice of that election with the
chief judge of the United States Tax Court specifying the date on which
service would begin to be credited under section 7443B of the Internal
Revenue Code of 1986, as added by this Act, in lieu of chapter 83 or
chapter 84 of title 5, United States Code. Such notice shall be filed
in accordance with such procedures as the chief judge of the United
States Tax Court shall prescribe.
(c) Lump-Sum Credit Under Title 5.--A magistrate judge of the
United States Tax Court who makes an election under subsection (b)
shall be entitled to a lump-sum credit under section 8342 or 8424 of
title 5, United States Code, as the case may be, for any service which
is covered under section 7443B of the Internal Revenue Code of 1986, as
added by this Act, pursuant to that election, and with respect to which
any contributions were made by the magistrate judge under the
applicable provisions of title 5, United States Code.
(d) Recall.--With respect to any magistrate judge of the United
States Tax Court receiving an annuity under this section who is
recalled to serve under section 7443C of the Internal Revenue Code of
1986, as added by this Act--
(1) the amount of compensation which such recalled
magistrate judge receives under such section 7443C shall be
calculated on the basis of the annuity received under this
section, and
(2) such recalled magistrate judge of the United States Tax
Court may serve as a reemployed annuitant to the extent
otherwise permitted under title 5, United States Code.
Section 7443B(m)(4) of the Internal Revenue Code of 1986, as added by
this Act, shall not apply with respect to service as a reemployed
annuitant described in paragraph (2).

SEC. 212. PROVISIONS FOR RECALL.

(a) In General.--Part I of subchapter C of chapter 76, as amended
by this Act, is amended by inserting after section 7443B the following
new section:

``SEC. 7443C. RECALL OF MAGISTRATE JUDGES OF THE TAX COURT.

``(a) Recalling of Retired Magistrate Judges.--Any individual who
has retired pursuant to section 7443B or the applicable provisions of
title 5, United States Code, upon reaching the age and service
requirements established therein, may at or after retirement be called
upon by the chief judge of the Tax Court to perform such judicial
duties with the Tax Court as may be requested of such individual for
any period or periods specified by the chief judge; except that in the
case of any such individual--
``(1) the aggregate of such periods in any 1 calendar year
shall not (without such individual's consent) exceed 90
calendar days, and
``(2) such individual shall be relieved of performing such
duties during any period in which illness or disability
precludes the performance of such duties.
Any act, or failure to act, by an individual performing judicial duties
pursuant to this subsection shall have the same force and effect as if
it were the act (or failure to act) of a magistrate judge of the Tax
Court.
``(b) Compensation.--For the year in which a period of recall
occurs, the magistrate judge shall receive, in addition to the annuity
provided under the provisions of section 7443B or under the applicable
provisions of title 5, United States Code, an amount equal to the
difference between that annuity and the current salary of the office to
which the magistrate judge is recalled. The annuity of the magistrate
judge who completes that period of service, who is not recalled in a
subsequent year, and who retired under section 7443B, shall be equal to
the salary in effect at the end of the year in which the period of
recall occurred for the office from which such individual retired.
``(c) Rulemaking Authority.--The provisions of this section may be
implemented under such rules as may be promulgated by the Tax Court.''.
(b) Conforming Amendment.--The table of sections for part I of
subchapter C of chapter 76, as amended by this Act, is amended by
inserting after the item relating to section 7443B the following new
item:

``Sec. 7443C. Recall of magistrate judges
of the Tax Court.''.

SEC. 213. EFFECTIVE DATE.

Except as otherwise provided, the amendments made by this title
shall take effect on the date of the enactment of this Act.

Calendar No. 96

109th CONGRESS

1st Session

S. 661

[Report No. 109-64]

_______________________________________________________________________

A BILL

To amend the Internal Revenue Code of 1986 to provide for the
modernization of the United States Tax Court, and for other purposes.

_______________________________________________________________________

April 28, 2005

Reported with an amendment