[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5146 Introduced in House (IH)]
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119th CONGRESS
1st Session
H. R. 5146
To amend the Internal Revenue Code of 1986 to provide for certain rules
regarding determination of tax in the case of a receivership.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
September 4, 2025
Mr. LaHood (for himself and Mr. Beyer) introduced the following bill;
which was referred to the Committee on Ways and Means, and in addition
to the Committee on the Judiciary, for a period to be subsequently
determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide for certain rules
regarding determination of tax in the case of a receivership.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Federal Receivership Fairness Act''.
SEC. 2. DETERMINATION OF TAX LIABILITY OF RECEIVERSHIP ESTATE.
(a) In General.--Subchapter B of chapter 70 of the Internal Revenue
Code of 1986 is amended by adding at the end the following new section:
``SEC. 6874. DETERMINATION OF TAX LIABILITY BY COURTS.
``(a) In General.--Except as provided in subsection (b), the court
appointing a receiver in any receivership proceeding before any court
of the United States or of any State or the District of Columbia may
determine the amount or legality of any Federal tax, any fine or
penalty relating to such a tax, or any addition to such tax, whether or
not previously assessed, whether or not paid, and whether or not
contested before and adjudicated by a judicial or administrative
tribunal of competent jurisdiction.
``(b) Exceptions.--The court described in subsection (a) shall not
determine--
``(1) the amount or legality of any Federal tax, fine,
penalty, or addition to tax if such amount or legality was
contested before and adjudicated by a judicial or
administrative tribunal of competent jurisdiction before the
commencement of the receivership,
``(2) any right of the estate to a Federal tax refund,
before the earlier of--
``(A) 120 days after the receiver properly requests
such refund, or
``(B) a determination by the appropriate
governmental unit of such request, or
``(3) the amount or legality of any amount arising in
connection with an ad valorem tax on real or personal property
of the receivership estate, if the applicable period for
contesting or redetermining that amount under any otherwise
applicable law has expired.
``(c) Request for Determination.--
``(1) Provision of address, etc.--The clerk of the court
described in subsection (a) shall maintain records under which
the appropriate governmental unit may--
``(A) designate an address for service of requests
under paragraph (2), and
``(B) describe where further information concerning
additional requirements for filing such requests may be
found.
If the appropriate governmental unit does not designate an
address and provide such address to the clerk under
subparagraph (A), any request made under paragraph (2) may be
served at the address for the filing of a tax return or protest
with respect to Federal taxes.
``(2) Request for determination.--A receiver may request a
determination of any unpaid liability of the estate for any tax
incurred before or during the administration of the case by
submitting a tax return for such tax and a request for such a
determination at the address and in the manner designated in
paragraph (1). Unless such return is fraudulent, or contains a
material misrepresentation, the estate, the receiver, the
individual or entity in receivership, and any successor to such
individual or entity are all discharged from any liability for
such tax--
``(A) upon payment of the tax shown on such return,
if--
``(i) the appropriate governmental unit
does not notify the receiver, within 60 days
after such request, that such return has been
selected for examination, or
``(ii) the appropriate governmental unit
does not complete such an examination and
notify the receiver of any tax due within 180
days after such request or within such
additional time as the court, for cause,
permits,
``(B) upon payment of the tax determined by the
court, after notice and a hearing, after completion by
the appropriate governmental unit of such examination;
or
``(C) upon payment of the tax determined by the
appropriate governmental unit to be due.
``(d) Assessment.--After determination by the court of a tax under
this section, the appropriate governmental unit may assess such tax
against the estate, the individual or entity in receivership, any
successor to such individual or entity, or any entity arising out of
the receivership, as the case may be, subject to any otherwise
applicable law.
``(e) Definitions.--For purposes of this section--
``(1) Receiver.--
``(A) In general.--Except as provided in
subparagraph (B), the term `receiver' means any person
or entity appointed or recognized as a receiver in any
action or proceeding by order of a Federal or State
court.
``(B) Exceptions.--The term `receiver' does not
include--
``(i) a bankruptcy trustee appointed in a
bankruptcy case under title 11, United States
Code, or
``(ii) an executor of a decedent's estate
whose rights and responsibilities as to Federal
tax matters are set forth in or governed by
other Federal or State law.
``(2) Appropriate governmental unit.--The term `appropriate
governmental unit' means a Federal, State, or local
governmental unit responsible for the collection of taxes
within the jurisdiction of such governmental unit.
``(f) Waiver of Sovereign Immunity.--
``(1) In general.--Notwithstanding an assertion of
sovereign immunity, sovereign immunity is abrogated as to the
appropriate governmental unit to the extent set forth in this
subsection with respect to the following:
``(A) All matters in subsections (a) through (e).
``(B) The court described in subsection (a) may
hear and determine any issue arising with respect to
the application of this section to the appropriate
governmental unit.
``(C) The court may issue against the appropriate
governmental unit an order, process, or judgment under
this section or under the Federal Rules of Civil
Procedure, including an order or judgment awarding a
money recovery, but not including an award of punitive
damages. Such order or judgment for costs or fees under
this section or the Federal Rules of Civil Procedure
against the appropriate governmental unit shall be
consistent with the provisions and limitations of
section 2412(d)(2)(A) of title 28, United States Code.
``(D) The enforcement of any such order, process,
or judgment against the appropriate governmental unit
shall be consistent with appropriate law applicable to
the governmental unit and, in the case of a money
judgment against the United States, shall be paid as if
it is a judgment rendered by a district court of the
United States or any State court.
``(E) Nothing in this section shall create any
substantive claim for relief or cause of action not
otherwise existing under the Federal Rules of Civil
Procedure or other applicable law.
``(2) Deemed waiver.--If the appropriate governmental unit
asserts a claim in any receivership case, the appropriate
governmental unit is deemed to have waived sovereign immunity
with respect to a claim against the appropriate governmental
unit that is property of the receivership estate therein and
that arose out of the same transaction or occurrence out of
which the claim of the appropriate governmental unit arose.
``(3) Offset of claims.--Notwithstanding any assertion of
sovereign immunity by the appropriate governmental unit, there
shall be offset against a claim or interest of the appropriate
governmental unit any claim against such governmental unit that
is property of the receivership estate.
``(g) Federal Court Option.--Notwithstanding subsection (a), if the
appropriate governmental unit objects to state court jurisdiction over
any determination under this section, the matter may be transferred to,
removed to, or otherwise heard by the United States District Court for
the district in which the receivership is pending''.
(b) Clerical Amendment.--The table of sections for subchapter B of
chapter 70 of the Internal Revenue Code of 1986 is amended by adding at
the end the following item:
``Sec. 6874. Determination of tax liability by courts.''.
(c) Conforming Amendments.--
(1) Section 2201(a) of title 28, United States Code, is
amended by inserting ``, a proceeding under section 6874 of
such Code'' after ``the Internal Revenue Code of 1986''.
(2) Section 3713(a)(2) of title 31, United States Code, is
amended by inserting ``, or to any receivership case or
proceeding or any receivership estate governed by section 6874
of the Internal Revenue Code of 1986'' after ``title 11''.
(3) Section 3713(b) of title 31, United States Code, is
amended--
(A) by striking ``(except a trustee acting under
title 11)'',
(B) by striking ``(b)'' and inserting ``(b)(1)'',
and
(C) by adding at the end the following new
paragraph:
``(2) Paragraph (1) shall not apply to--
``(A) a trustee acting under title 11; or
``(B) any receiver, as defined in section 6874(e)(1) of the
Internal Revenue Code of 1986, exercising the rights afforded
to receivers by such section 6874.''.
(d) Effective Date.--The amendments made by this section shall
apply to returns for which the period during which an assessment of tax
or an amendment or review or audit of the return is open as of the date
of the enactment of this Act, and to returns filed on or after such
date of enactment.
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