,,ii #aacth ,,congress #b;d ,session ,s4 #bbae ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,april #g1 #bjad ,mr4 ,cornyn introduced the following bill2 which was read twice and referred to the ,committee on ,finance ,a ,,bill ,to protect taxpayers from improper audits by the ,internal ,revenue ,service4 #a4 ,short title2 table of contents 7a7 ,short title ,this ,act may be cited as the ,eliminating ,improper and ,abusive ,,irs ,audits ,act of #bjad4 7b7 ,table of contents ,the table of contents of this ,act is as follows3 ,sec4 #a4 ,short title2 table of contents4 ,sec4 #b4 ,civil damages allowed for reckless or intentional disregard of internal revenue laws4 ,sec4 #c4 ,modifications relating to certain offenses by officers and employees in connection with revenue laws4 ,sec4 #d4 ,modifications relating to civil damages for unauthorized inspection or disclosure of returns and return information4 ,sec4 #e4 ,extension of time for contesting ,,irs levy4 ,sec4 #f4 ,increase in monetary penalties for certain unauthorized disclosures of information4 ,sec4 #g4 ,ban on raising new issues on appeal4 ,sec4 #h4 ,limitation on enforcement of liens against principal residences4 ,sec4 #i4 ,additional provisions relating to mandatory termination for misconduct4 ,sec4 #aj4 ,extension of declaratory judgment procedures to social welfare organizations4 ,sec4 #aa4 ,review by the ,treasury ,inspector ,general for ,tax ,administration4 #b4 ,civil damages allowed for reckless or intentional disregard of internal revenue laws 7a7 ,increase in amount of damages ,section #gdcc7;b7 of the ,internal ,revenue ,code of #aihf is amended by striking #a1jjj1jjj 7#ajj1jjj1 in the case of negligence7 and inserting #c1jjj1jjj 7#cjj1jjj1 in the case of negligence74 7b7 ,extension of time ,to bring action ,section #gdcc7;d77#c7 of the ,internal ,revenue ,code of #aihf is amended by striking #b years and inserting #e years4 7c7 ,effective date ,the amendments made by this section shall apply to actions of employees of the ,internal ,revenue ,service after the date of the enactment of this ,act4 #c4 ,modifications relating to certain offenses by officers and employees in connection with revenue laws 7a7 ,increase in penalty ,section #gbad of the ,internal ,revenue ,code of #aihf is amended-- 7#a7 by striking #aj1jjj in subsection 7a7 and inserting #be1jjj1 and 7#b7 by striking #e1jjj in subsection 7b7 and inserting #aj1jjj4 7b7 ,effective date ,the amendments made by this section shall take effect on the date of the enactment of this ,act4 #d4 ,modifications relating to civil damages for unauthorized inspection or disclosure of returns and return information 7a7 ,increase in amount of damages ,subparagraph 7,a7 of section #gdca7;c77#a7 of the ,internal ,revenue ,code of #aihf is amended by striking #a1jjj and inserting #aj1jjj4 7b7 ,effective date ,the amendment made by this section shall apply to inspections and disclosure occurring on and after the date of the enactment of this ,act4 #e4 ,extension of time for contesting ,,irs levy 7a7 ,extension of time for return of property subject to levy ,subsection 7b7 of section #fcdc of the ,internal ,revenue ,code of #aihf is amended by striking #i months and inserting #c years4 7b7 ,period of limitation on suits ,subsection 7c7 of section #fecb of the ,internal ,revenue ,code of #aihf is amended-- 7#a7 in paragraph 7#a7 by striking #i months0 and inserting #8#8#c years1 and 7#b7 in paragraph 7#b7 by striking #i-month and inserting #c-year4 7c7 ,effective date ,the amendments made by this section shall apply to-- 7#a7 levies made after the date of the enactment of this ,act1 and 7#b7 levies made on or before such date if the #i-month period has not expired under section #fcdc7;b7 of the ,internal ,revenue ,code of #aihf 7without regard to this section7 as of such date4 #f4 ,increase in monetary penalties for certain unauthorized disclosures of information 7a7 ,in general ,paragraphs 7#a71 7#b71 7#c71 and 7#d7 of section #gbac7;a7 of the ,internal ,revenue ,code of #aihf are each amended by striking #e1jjj and inserting #aj1jjj4 7b7 ,effective date ,the amendments made by this section shall apply to disclosures made after the date of the enactment of this ,act4 #g4 ,ban on raising new issues on appeal 7a7 ,in general ,chapter #gg of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new section3 #gebi4 ,prohibition on ,internal ,revenue ,service raising new issues in an internal appeal 7a7 ,in general ,in reviewing an appeal of any determination initially made by the ,internal ,revenue ,service1 the ,internal ,revenue ,service ,office of ,appeals may not consider or decide any issue that is not within the scope of the initial determination4 7b7 ,certain issues deemed outside of scope of determination ,for purposes of subsection 7a71 the following matters shall be considered to be not within the scope of a determination3 7#a7 ,any issue that was not raised in a notice of deficiency or an examiner's report which is the subject of the appeal4 7#b7 ,any deficiency in tax which was not included in the initial determination4 7#c7 ,any theory or justification for a tax deficiency which was not considered in the initial determination4 7c7 ,no inference with respect to issues raised by taxpayers ,nothing in this section shall be construed to provide any limitation in addition to any limitations in effect on the date of the enactment of this section on the right of a taxpayer to raise an issue1 theory1 or justification on an appeal from a determination initially made by the ,internal ,revenue ,service that was not within the scope of the initial determination4 4 7b7 ,clerical amendment ,the table of sections for chapter #gg of such ,code is amended by adding at the end the following new item3 ,sec4 #gebi4 ,prohibition on ,internal ,revenue ,service raising new issues in an internal appeal4 4 7c7 ,effective date ,the amendments made by this section shall apply to matters filed or pending with the ,internal ,revenue ,service ,office of ,appeals on or after the date of the enactment of this ,act4 #h4 ,limitation on enforcement of liens against principal residences 7a7 ,in general ,section #gdjc7;a7 of the ,internal ,revenue ,code of #aihf is amended-- 7#a7 by striking ,in any case and inserting the following3 7#a7 ,in general ,in any case 1 and 7#b7 by adding at the end the following new paragraph3 7#b7 ,limitation with respect to principal residence 7,a7 ,in general ,paragraph 7#a7 shall not apply to any property used as the principal residence of the taxpayer 7within the meaning of section #aba7 unless the ,secretary of the ,treasury makes a written determination that-- 7i7 all other property of the taxpayer1 if sold1 is insufficient to pay the tax or discharge the liability1 and 7ii7 such action will not create an economic hardship for the taxpayer4 7,b7 ,delegation ,for purposes of this paragraph1 the ,secretary of the ,treasury may not delegate any responsibilities under subparagraph 7,a7 to any person other than-- 7i7 the ,commissioner of ,internal ,revenue1 or 7ii7 a district director or assistant district director of the ,internal ,revenue ,service4 4 7b7 ,effective date ,the amendments made by this section shall apply to actions filed after the date of the enactment of this ,act4 #i4 ,additional provisions relating to mandatory termination for misconduct 7a7 ,termination of unemployment for inappropriate review of tax-,exempt status ,section #abjc7;b7 of the ,internal ,revenue ,service ,restructuring and ,reform ,act of #aiih 7#bf ,u4,s4,c4 #ghjd note7 is amended by striking and at the end of paragraph 7#i71 by striking the period at the end of paragraph 7#aj7 and inserting 2 and1 and by adding at the end the following new paragraph3 7#aa7 in the case of any review of an application for tax-exempt status by an organization described in section #eja7;c7 of the ,internal ,revenue ,code of #aihf1 developing or using any methodology that applies disproportionate scrutiny to any applicant based on the ideology expressed in the name or purpose of the organization4 4 7b7 ,mandatory unpaid administrative leave for misconduct ,paragraph 7#a7 of ,section #abjc7;c7 of the ,internal ,revenue ,service ,restructuring and ,reform ,act of #aiih 7#bf ,u4,s4,c4 #ghjd note7 is amended by adding at the end the following new sentence3 ,notwithstanding the preceding sentence1 if the ,commissioner of ,internal ,revenue takes a personnel action other than termination for an act or omission described in subsection 7b71 the ,commissioner shall place the employee on unpaid administrative leave for a period of not less than #cj days44 7c7 ,limitation on alternative punishment ,paragraph 7#a7 of section #abjc7;c7 of the ,internal ,revenue ,service ,restructuring and ,reform ,act of #aiih 7#bf ,u4,s4,c4 #ghjd note7 is amended by striking ,the ,commissioner and inserting ,except in the case of an act or omission described in subsection 7b77#c77;,a71 the ,commissioner4 #aj4 ,extension of declaratory judgment procedures to social welfare organizations 7a7 ,in general ,section #gdbh7;a77#a7 of the ,internal ,revenue ,code of #aihf is amended by striking or at the end of subparagraph 7,c7 and by adding at the end the following new subparagraph3 7,e7 with respect to the initial classification or continuing classification of an organization described in section #eja7;c77#d7 which is exempt from tax under section #eja7;a71 or 4 7b7 ,effective date ,the amendments made by this section shall apply with respect to pleading filed after the date of the enactment of this ,act4 #aa4 ,review by the ,treasury ,inspector ,general for ,tax ,administration 7a7 ,review ,subsection 7k77#a7 of section #h;,d of the ,inspector ,general ,act of #aigh 7#e ,u4,s4,c4 ,app47 is amended-- 7#a7 in subparagraph 7,c71 by striking and at the end2 7#b7 by redesignating subparagraph 7,d7 as subparagraph 7,e72 7#c7 by inserting after subparagraph 7,c7 the following new subparagraph3 7,d7 shall-- 7i7 review any criteria employed by the ,internal ,revenue ,service to select tax returns 7including applications for recognition of tax-exempt status7 for examination or audit1 assessment or collection of deficiencies1 criminal investigation or referral1 refunds for amounts paid1 or any heightened scrutiny or review in order to determine whether the criteria discriminates against taxpayers on the basis of race1 religion1 or political ideology2 and 7ii7 consult with the ,internal ,revenue ,service on recommended amendments to such criteria in order to eliminate any discrimination identified pursuant to the review described in clause 7i72 and 2 and 7#d7 in subparagraph 7,e71 as so redesignated1 by striking and 7,c7 and inserting 7,c71 and 7,d74 7b7 ,semiannual ,report ,subsection 7g7 of such section is amended by adding at the end the following new paragraph3 7#c7 ,any semiannual report made by the ,treasury ,inspector ,general for ,tax ,administration that is required pursuant to section #e7;a7 shall include-- 7,a7 a statement affirming that the ,treasury ,inspector ,general for ,tax ,administration has reviewed the criteria described in subsection 7k77#a77;,d7 and consulted with the ,internal ,revenue ,service regarding such criteria2 and 7,b7 a description and explanation of any such criteria that was identified as discriminatory by the ,treasury ,inspector ,general for ,tax ,administration4 4