I. Executive Branch Governance
A. IRS Restructuring and Creation of IRS Oversight Board
2. Establishment and duties of IRS Oversight Board
The modification would provide that the IRS Oversight Board's limited
access to taxpayer return information would not extend to any taxpayer's
name, address, social security number, or employer identification number.
III. Taxpayer Bill of Rights 3
C. Relief for Innocent Spouses and Persons with Disabilities
1. Innocent spouse relief
The modification would require that, whenever practicable, the IRS
send appropriate notifications to both spouses.
The modification also would clarify that innocent spouse relief
would not be available for spouses who joined in the filing of a joint
return to the extent the spouse had actual knowledge of the understatement
F. Disclosures to Taxpayers
6. Notification of change in tax matters partner
The modification would require the IRS to notify all partners of
any resignation of the tax matters partner that is required by the IRS,
and to notify the partners of any successor tax matters partner.
1. Study of penalty administration
The modification would provide that the separate studies to be conducted
by the Joint Committee on Taxation and by the Department of Treasury regarding
the administration and implementation of certain penalty reform provisions
also would include an analysis of the interest provisions in the Code.
Such studies would include legislative and administrative recommendations
deemed appropriate to simplify the administration of the interest provisions
and to reduce taxpayer burden.
7. Liberal acceptance policy for offers-in-compromise
The modification would remove the provision of the Chairman's Mark
that provides that the IRS should implement liberal acceptance procedures
for offers-in-compromise. However, language similar to that contained in
the deleted provision would be inserted in the Committee Report.
L. Additional Items
The Chairman's Mark would include the following new item 11:
11. Moratorium and Sense of the Committee
The modification would provide that no temporary or final regulations
with respect to Notice 98-11 may be implemented prior to six months after
the date of enactment of this provision.
In addition, the modification would provide that it is the Sense
of the Senate Committee on Finance that:
(1) The Department of the Treasury and the Internal Revenue Service
should withdraw Notice 98-11 and the regulations issued thereunder. Congress,
not the Department of the Treasury nor the Internal Revenue Service, should
determine the international tax policy issues presented with respect to
the treatment of hybrid transactions under the subpart F provisions of
the Internal Revenue Code.
(2) The Department of the Treasury and the Internal Revenue Service should
limit any regulations issued under Notice 98-5 to the specific transactions
described therein. It is expected that (a) such regulations would not affect
transactions undertaken in the ordinary course of business; (b) any regulations
issued under Notice 98-5 would not have an effective date any earlier than
the date of issuance of proposed regulations; and (c) the issuance of such
regulations would follow normal regulatory procedures, including a comment
period. Nothing herein shall be construed to limit the ability of the Department
of the Treasury and the Internal Revenue Service to address abusive transactions.
IV. Congressional Accountability for the IRS
B. Tax Law Complexity Analysis
The modification would clarify that the cost of taxpayer compliance
would be considered as part of the tax law complexity analysis to be provided
by the Joint Committee on Taxation.