,i #aafth ,,congress #b;d ,session ,h4 ,r4 #hgjj ,,in ,,the ,,house ,,of ,,representatives ,october #bg1 #bjbj,mr4 ,vela introduced the following bill2 which was referred to the ,committee on ,ways and ,means ,a ,,bill ,to amend the ,internal ,revenue ,code of #aihf to reduce taxpayer burdens and enhance taxpayer protections1 and for other purposes4 #a4 ,short title2 etc 7a7 ,short title ,this ,act may be cited as the ,john ,lewis ,taxpayer ,protection ,act4 7b7 ,amendment of #aihf ,code ,except as otherwise expressly provided1 whenever in this ,act an amendment or repeal is expressed in terms of an amendment to1 or repeal of1 a section or other provision1 the reference shall be considered to be made to a section or other provision of the ,internal ,revenue ,code of #aihf1 as amended4 7c7 ,table of contents ,the table of contents for this ,act is as follows3 ,sec4 #a4 ,short title2 etc4,title ,i--,protection of ,taxpayers from ,abusive ,tax ,collection ,practices,sec4 #aja4 ,repeal of rules relating to tax collection contracts4,title ,,ii--,relief for ,taxpayers,sec4 #bja4 ,de minimis exclusion from gross income for discharge of indebtedness of individuals4,sec4 #bjb4 ,repeal suspension of statute of limitations during pending application for ,taxpayer ,assistance order4,sec4 #bjc4 ,limitation on levy on retirement savings4,sec4 #bjd4 ,tolling of limitation on levy recovery for disabled taxpayer4,sec4 #bje4 ,extension of period to withdraw frivolous submission4,sec4 #bjf4 ,repeal of partial payment requirement on submissions of offers-in-compromise4,title ,,iii--,assistance ,low-,income ,taxpayers,sec4 #cja4 ,,eitc outreach4,title ,,iv--,ensure ,taxpayer ,access to ,competent ,tax ,return ,preparers,sec4 #dja4 ,regulation of tax return preparers4,sec4 #djb4 ,tax information disclosure relating to tax return preparer misconduct4,title ,v--,increase ,funding for ,services to ,taxpayers,sec4 #eja4 ,low-income taxpayer clinics4,sec4 #ejb4 ,internal ,revenue ,service taxpayer services appropriations4 ,i ,protection of ,taxpayers from ,abusive ,tax ,collection ,practices #aja4 ,repeal of rules relating to tax collection contracts 7a7 ,in general ,sections #fcjf and #fcjg are hereby repealed1 and the table of sections for subchapter ,a of chapter #fd is amended by striking the items relating to sections #fcjf and #fcjg4 7b7 ,conforming amendments 7#a7 ,section #fajc7k7 is amended by striking paragraph 7#ab74 7#b7 ,section #gdcc;,a7a7 is amended by inserting 1 as in effect on the day before the date of the enactment of the ,john ,lewis ,taxpayer ,protection ,act after as defined in section #fcjf7;b74 7#c7 ,section #ghji7;a7 is amended by striking #fcjf14 7#d7 ,section #ghaa is amended by striking subsection 7g74 ,,ii ,relief for ,taxpayers #bja4 ,de minimis exclusion from gross income for discharge of indebtedness of individuals 7a7 ,in general ,section #ajh7;a77#a7 is amended by striking or at the end of subparagraph 7,d71 by striking the period at the end of subparagraph 7,e7 and inserting 1 or1 and by adding at the end the following new subparagraph3 7,f7 the indebtedness discharged is qualified individual indebtedness4 4 7b7 ,qualified individual indebtedness ,section #ajh is amended by adding at the end the following new subsection3 7j7 ,special rules relating to qualified individual indebtedness 7#a7 ,qualified individual indebtedness defined ,for purposes of this section1 the term qualified individual indebtedness means any indebtedness of an individual other than indebtedness which is-- 7,a7 discharged on account of services performed for the lender1 or 7,b7 held at any time by a person related to such individual4 ,for purposes of subparagraph 7,b71 a person shall be treated as related to another person if the relationship between such persons would result in a disallowance of losses under section #bfg or #gjg7;b74 7#b7 ,dollar limitation ,the amount of qualified individual indebtedness excluded from gross income under subsection 7a77#a77;,f7 with respect to any individual for any taxable year shall not exceed the excess of-- 7,a7 #aj1jjj1 over 7,b7 the aggregate amount excluded from the gross income of such individual under subsection 7a77#a7 for such taxable year and all prior taxable years 7determined without regard to any amount excludable from gross income under subsection 7a77#a77;,f7 for such taxable year74 7#c7 ,joint returns ,in the case of a joint return-- 7,a7 the dollar limitation under paragraph 7#b7 shall be applied separately to each spouse1 and 7,b7 the taxpayer may elect to treat any indebtedness of either spouse as indebtedness of the other spouse4 4 7c7 ,coordination 7#a7 ,in general ,section #ajh7;a77#b7 is amended by adding at the end the following new subparagraph3 7,d7 ,precedence of individual indebtedness exclusion 7i7 ,individual indebtedness exclusion takes precedence over insolvency exclusion unless elected otherwise ,paragraph 7#a77;,b7 shall not apply to a discharge to which paragraph 7#a77;,f7 applies unless the taxpayer elects to apply paragraph 7#a77;,b7 in lieu of paragraph 7#a77;,f74 7ii7 ,other exclusions take precedence ,subparagraph 7,f7 shall not apply to a discharge to which subparagraph 7,c71 7,d71 or 7,e7 applies4 4 7#b7 ,title #aa exclusion takes precedence ,section #ajh7;a77#b77;,a7 is amended by striking and 7,e7 and inserting 7,e71 and 7,f74 7d7 ,effective date ,the amendments made by this section shall apply to discharges of indebtedness after the date of the enactment of this ,act4 #bjb4 ,repeal suspension of statute of limitations during pending application for ,taxpayer ,assistance order 7a7 ,in general ,section #ghaa is amended by striking subsection 7d7 and redesignating subsections 7e71 7f71 and 7g7 as subsections 7d71 7e71 and 7f71 respectively4 7b7 ,conforming amendment ,section #fcjf7k77#b7 is amended by striking section #ghaa7;g7 and inserting section #ghaa7;f74 7c7 ,effective date ,the amendment made by this section shall take effect on the date of the enactment of this ,act4 #bjc4 ,limitation on levy on retirement savings 7a7 ,in general ,section #fccd7;a7 is amended by adding at the end the following new paragraph3 7#ad7 ,retirement savings 7,a7 ,in general ,any individual's interest in a qualified retirement plan-- 7i7 before such individual has attained normal retirement age 7or #fe in the case of an individual retirement account or a plan which does not specify a normal retirement age71 or 7ii7 after the attainment of such age if the levy would create an economic hardship due to the financial condition of the taxpayer 7within the meaning of #fcdc7;a77#a77;,d774 7,b7 ,qualified retirement plan ,for purposes of this paragraph1 the term qualified retirement plan means-- 7i7 an individual retirement account1 or 7ii7 a defined contribution plan which-- 7,i7 is described in section #dja7;a7 and which includes a trust exempt from tax under section #eja7;a71 7,,ii7 is described in subsection 7a7 or 7b7 of section #djc1 or 7,,iii7 is an eligible deferred compensation plan 7as defined in section #deg7;b77 of an eligible employer described in section #deg7;e77#a77;,a74 7,c7 ,exception for flagrant acts ,subparagraph 7,a7 shall not apply if the ,secretary determines that-- 7i7 the taxpayer filed a fraudulent return1 or 7ii7 the taxpayer acted with the intent to evade or defeat any tax imposed by this title or the collection or payment thereof4 4 7b7 ,effective date ,the amendment made by this section shall apply to levies issued after ,december #ca1 #bjbj4 #bjd4 ,tolling of limitation on levy recovery for disabled taxpayer 7a7 ,in general ,section #fcdc7;b7 is amended by inserting after the third sentence3 ,in the case of an individual1 the running of such #i-month period shall be suspended during any period of such individual's life that such individual is financially disabled 7as defined in section #feaa7;h7744 7b7 ,suits by persons other than taxpayers ,section #fecb7;c77#a7 is amended by adding at the end the following3 ,in the case of an individual1 the running of such #i-month period shall be suspended during any period of such individual's life that such individual is financially disabled 7as defined in section #feaa7;h7744 #bje4 ,extension of period to withdraw frivolous submission 7a7 ,in general ,section #fgjb7;b77#c7 is amended by striking #cj days and inserting #fj days4 7b7 ,effective date ,the amendment made by this section shall apply to notices provided after ,december #ca1 #bjbj4 #bjf4 ,repeal of partial payment requirement on submissions of offers-in-compromise 7a7 ,in general ,section #gabb is amended by striking subsection 7c7 and by redesignating subsections 7d71 7e71 7f71 and 7g7 as subsections 7c71 7d71 7e71 and 7f71 respectively4 7b7 ,conforming amendments 7#a7 ,section #gabb7;d77#c7 is amended by inserting and at the end of the subparagraph 7,a71 by striking 1 and at the end of subparagraph 7,b7 and inserting a period1 and by striking subparagraph 7,c74 7#b7 ,section #gabb1 as amended by this section1 is amended by adding at the end the following new subsection3 7g7 ,application of user fee ,in the case of any assessed tax or other amounts imposed under this title with respect to such tax which is the subject of an offer-in-compromise1 such tax or other amounts shall be reduced by any user fee imposed under this title with respect to such offer-in-compromise4 4 7#c7 ,section #faei7;g7 is amended by striking section #gabb7;e7 and inserting section #gabb7;d74 7c7 ,effective date ,the amendments made by this section shall apply to offers submitted after the date of the enactment of this ,act4 ,,iii ,assistance ,low-,income ,taxpayers #cja4 ,,eitc outreach 7a7 ,in general ,section #cb is amended by adding at the end the following new subsection3 7n7 ,notification of potential eligibility for credit and refund 7#a7 ,in general ,to the extent possible and on an annual basis1 the ,secretary shall provide notice to each taxpayer who-- 7,a7 did not claim the credit under subsection 7a7 for any preceding taxable year for which credit or refund is not precluded by section #feaa1 and 7,b7 may be allowed such credit for any such taxable year based on return or return information 7as defined in section #fajc7;b77 available to the ,secretary1 that such taxpayer may be eligible to claim such credit and a refund for such taxable year4 7#b7 ,notice ,notice provided under paragraph 7#a7 shall be in writing and sent to the last known address of the taxpayer4 4 7b7 ,effective date ,the amendment made by this section shall take effect on ,january #a1 #bjba4 ,,iv ,ensure ,taxpayer ,access to ,competent ,tax ,return ,preparers #dja4 ,regulation of tax return preparers 7a7 ,in general ,section #ccj7;a7 of title #ca1 ,united ,states ,code1 is amended-- 7#a7 by striking paragraph 7#a7 and inserting the following3 7#a7 regulate-- 7,a7 the practice of representatives of persons before the ,department of the ,treasury2 and 7,b7 the practice of tax return preparers2 and 1 and 7#b7 in paragraph 7#b7-- 7,a7 by inserting or tax return preparer after representative each place it appears1 and 7,b7 by inserting or in preparing their tax returns1 claims for refund1 or documents in connection with tax returns or claims for refund after cases in subparagraph 7,d74 7b7 ,authority ,to sanction regulated tax return preparers ,section #ccj7;c7 of title #ca1 ,united ,states ,code1 is amended-- 7#a7 by inserting or tax return preparer after representative each place it appears1 and 7#b7 in paragraph 7#d71 by striking misleads or threatens and all that follows and inserting the following3 misleads or threatens-- 7,a7 any person being represented or any prospective person being represented2 or 7,b7 any person or prospective person whose tax return1 claim for refund1 or document in connection with a tax return or claim for refund1 is being or may be prepared4 4 7c7 ,tax return preparer defined ,section #ccj of title #ca1 ,united ,states ,code1 is amended by adding at the end the following new subsection3 7f7 ,tax return preparer ,for purposes of this section-- 7#a7 ,in general ,the term tax return preparer has the meaning given such term under section #ggja7;a77#cf7 of the ,internal ,revenue ,code of #aihf4 7#b7 ,tax return ,the term tax return has the meaning given to the term return under section #ffif7;e77#a7 of such ,code4 7#c7 ,claim for refund ,the term claim for refund has the meaning given such term under section #ffif7;e77#b7 of such ,code4 4 7d7 ,effective date ,the amendments made by this section shall apply with respect to returns and claims for refund for taxable years beginning after the date of the enactment of this ,act4 #djb4 ,tax information disclosure relating to tax return preparer misconduct ,section #fajc7k71 as amended by section #aja1 is amended by inserting after paragraph 7#aa7 at the end the following new paragraph3 7#ab7 ,disclosure relating to tax return preparer misconduct ,under such procedures as the ,secretary may prescribe1 the ,secretary may disclose returns or return information to the extent necessary to publish final decisions by the ,internal ,revenue ,service ,office of ,professional ,responsibility relating to tax return preparer misconduct4 4 ,v ,increase ,funding for ,services to ,taxpayers #eja4 ,low-income taxpayer clinics 7a7 ,increase in authorized grants ,section #gebf7;c77#a7 is amended by striking #f1jjj1jjj and inserting #bj1jjj1jjj4 7b7 ,clerical amendment ,section #gebf7;c77#e7 is amended by inserting qualified before low-income4 7c7 ,effective date ,the amendments made by this section shall apply with respect to grants made after the date of the enactment of this ,act4 #ejb4 ,internal ,revenue ,service taxpayer services appropriations ,there is hereby appropriated1 out of any money in the ,treasury not otherwise appropriated1 for the fiscal year ending ,september #cj1 #bjba1 for necessary expenses of the ,internal ,revenue ,service to provide taxpayer services1 including pre-filing assistance and education1 filing and account services1 taxpayer advocacy services1 and other services as authorized by #e ,u4,s4,c4 #caji1 at such rates as may be determined by the ,commissioner1 #b1djf1jjj1jjj4