[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3335 Introduced in House (IH)]
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118th CONGRESS
1st Session
H. R. 3335
To ensure the successful development of the electronic Income
Verification Express Service of the Internal Revenue Service by
amending the Taxpayer First Act to clarify that taxpayer identity
verification is the responsibility of users of the system rather than
the taxpayer, and for other purposes.
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IN THE HOUSE OF REPRESENTATIVES
May 15, 2023
Mr. McHenry (for himself and Mr. Panetta) introduced the following
bill; which was referred to the Committee on Ways and Means
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A BILL
To ensure the successful development of the electronic Income
Verification Express Service of the Internal Revenue Service by
amending the Taxpayer First Act to clarify that taxpayer identity
verification is the responsibility of users of the system rather than
the taxpayer, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. IDENTITY VERIFICATION RESPONSIBILITY.
(a) In General.--Section 2201 of the Taxpayer First Act (Public Law
116-25) is amended--
(1) in subsection (a), by striking ``and'' at the end of
paragraph (1), by redesignating paragraph (2) as paragraph (3),
and by inserting after paragraph (1) the following new
paragraph:
``(2) is accomplished only after a financial institution
(or a service provider, subsidiary, affiliate, agent,
subcontractor, or assignee of a financial institution) has
formed a reasonable belief that the identity of the taxpayer
has been authenticated; and''; and
(2) in subsection (b), by striking ``by the Secretary to a
person seeking to verify the income or creditworthiness of a
taxpayer who is a borrower in the process of a loan
application'' and inserting ``, including business tax return
information, by the Secretary to a taxpayer or financial
institution (or a service provider, subsidiary, affiliate,
agent, subcontractor, or assignee of a financial institution)
designated by a taxpayer seeking to verify the income or
creditworthiness of a taxpayer who is in the process of a
financial application''.
(b) Financial Institution Definition, Standards and Guidelines.--
Section 2201(c) of such Act is amended--
(1) in subsection (c)--
(A) by striking ``The Secretary'' and inserting:
``(1) In general.--The Secretary''; and
(B) by adding at the end the following new
paragraph:
``(2) Standards.--The Secretary shall ensure that any
standards and guidelines deemed applicable to the system
described in this section--
``(A) Enable a taxpayer to provide the appropriate
designation and electronic consent to a financial
institution (or a service provider, subsidiary,
affiliate, agent, subcontractor, or assignee of a
financial institution), including those defined in
section 106 of the Electronic Signatures in Global and
National Commerce Act (15 U.S.C. 7006);
``(B) Enable a financial institution (or a service
provider, subsidiary, affiliate, agent, subcontractor,
or assignee of a financial institution) to act upon
such designation and consent to request a qualified
disclosure directly with the system implemented
pursuant to this section; and
``(C) Ensure the security and confidentiality of
taxpayer information, to the extent such standards and
guidelines do not conflict with other standards and
guidelines applicable to financial institutions.'', and
(2) by redesignating subsections (c) and (d) as subsections
(d) and (e), respectively, and by inserting after subsection
(b) the following new subsection:
``(c) Financial Institution.--For purposes of this section, the
term `financial institution' has the meaning given such term in section
509 of the Gramm-Leach-Bliley Act (15 U.S.C. 6809).''.
(c) Limitation on Authority.--Section 2201 of such Act is amended
by adding at the end the following new subsection:
``(f) Limitation on Authority.--The Secretary may not require a
taxpayer seeking a qualified disclosure to access any information
technology system or service used by or on behalf of the Internal
Revenue Service pursuant to this section for any purpose relating to a
qualified disclosure, including identity verification or the provision
of electronic consent.''.
(d) Clarification Regarding Certain Business Tax Return Information
Available for Disclosure.--Section 2201 of such Act, as amended by
subsection (c), is amended by adding at the end the following new
subsection:
``(g) Program Required To Make Certain Information Available for
Disclosure.--The Secretary shall ensure that the program implemented
under this section makes certain business tax return information
available for disclosure, including, but not limited to, the following:
``(1) The following information from Schedule K-1 of Forms
1065 and 1120:
``(A) Names of owners.
``(B) Percentage of capital ownership of each
owner.
``(C) Distributions to each owner.
``(D) In the case of Form 1065, direct payments to
partners.
``(2) The following information from Schedule G of Form
1120:
``(A) Names of owners.
``(B) Percentage of capital ownership of each
owner.
``(3) With respect to each entity identified on Schedule C
of Form 1040, the following information from such Schedule:
``(A) Name of such entity.
``(B) Names of owners of such entity.
``(C) Income statement of each entity.
``(4) All information available on the following forms or
schedules:
``(A) Schedule L.
``(B) Schedule M.
``(C) Form 1125-E.
``(D) Any schedules or supplemental schedules of
Form 1040 (or any other personal income tax return
form) which includes information related to any income,
deduction, gain, loss, or credit which is derived in
the conduct of any trade or business (other than the
trade or business of being an employee).
``(5) NAICS codes with respect to all forms and schedules.
Each reference to a form or schedule in this subsection shall be
treated as including a reference to any form or schedule which is a
successor or alternative to such form or schedule.''.
(e) Effective Date.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall take
effect as if included in section 2201 of the Taxpayer First Act
(Public Law 116-25).
(2) Clarification regarding certain business tax return
information available for disclosure.--The amendment made by
subsection (d) shall take effect on the date which is 1 year
after the date of the enactment of this Act.
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