,,ii  #aai? ,,congress  #b;d ,session   
,s4 #dfaf  ,,9 ,,! ,,s5ate ,,( ,,!      
,,unit$ ,,/ates  ,may #ba1 #bjbf,mr4    
,wyd5 7= himself & ,mr4 ,s*um]7         
introduc$ ! foll[+ bill2 :i* 0 read     
twice & ref]r$ to ! ,committee on       
,f9ance  ,a ,,bill  ,to am5d ! ,int]nal 
,rev5ue ,code ( #aihf to impose a tax on
 specifi$ settlem5t fund paym5ts1 & =   
o!r purposes4  #a4 ,%ort title  ,?is    
,act may be cit$ z ! ,/op ,lett+ ,unit$ 
,/ates ,heads ,funnel ,unau?oriz$       
,nontransp>5t ,doll>s ,act ( #bjbf or ! 
,,slu% ,,fund ,act ( #bjbf4  #b4        
,imposition ( tax on specifi$ settlem5t 
fund paym5ts  7a7 ,9 g5]al ,subtitle ,d 
( ! ,int]nal ,rev5ue ,code ( #aihf is   
am5d$ by add+ at ! end ! foll[+ new     
*apt]3  #ej;,b ,specifi$ settlem5t fund 
paym5ts  ,sec4 #ejjj;,e4 ,imposition (  
tax on specifi$ settlem5t fund paym5ts4 
#ejjj;,e4 ,imposition ( tax on specifi$ 
settlem5t fund paym5ts  7a7 ,9 g5]al    
,!re is h]eby impos$ on any taxpay] =   
any taxable ye> a tax equal to #ajj     

p]c5t ( any specifi$ settlem5t fund     
paym5t receiv$ by su* taxpay] dur+ su*  
taxable ye>4  7b7 ,specifi$ settlem5t   
fund paym5t ,= purposes ( ?is section-- 
7#a7 ,9 g5]al ,! t]m specifi$ settlem5t 
fund paym5t means1 ) respect to any     
taxpay] = any taxable ye>1 any am\nt    
receiv$ by su* taxpay] dur+ su* taxable 
ye> f any fund1 tru/1 or acc\nt ! assets
 ( :i* are d]iv$ f ! outcome 7:e!r by   
settlem5t1 v]dict1 or o!rwise7 ( any    
civil action :i* 0 fil$ by a specifi$   
p]son aga9/ ! ,unit$ ,/ates 7or any     
ag5cy or in/rum5tality !re(74  7#b7     
,specifi$ p]son  7,a7 ,9 g5]al ,! t]m   
specifi$ p]son means-- 7i7 any          
individual :o has s]v$ z ,presid5t ( !  
,unit$ ,/ates1  7ii7 any memb] ( !      
family ( su* individual1 &  7iii7 any   
p]son controll$ 7bas$ on pr9ciples      
simil> to ! pr9ciples :i* apply =       
purposes ( section #eb7;b77 by "o or m  
individuals describ$ 9 clause 7i7 or    
7ii74  7,b7 ,memb] ( ! family ,! t]m    
memb] ( ! family means1 ) respect to any

 individual describ$ 9 subp>agraph      
7,a77i7-- 7i7 ! sp\se ( su* individual1 
&  7ii7 any individual :o be>s a        
relation%ip to su* individual :i* is    
describ$ 9 subp>agraphs 7,a7 ?r\gh 7,g7 
( section #aeb7;d77#b74  7c7 ,special   
rules  7#a7 ,adm9i/rative provisions ,= 
purposes ( subtitle ,f1 any tax impos$  
by ?is section %all be treat$ z a tax   
impos$ by subtitle ,a4  7#b7 ,exclusion 
f gross income ,= purposes ( *apt] #a1 !
 gross income ( any taxpay] = any       
taxable ye> %all n include any specifi$ 
settlem5t fund paym5t receiv$ by su*    
taxpay] dur+ su* taxable ye>4  4  7b7   
,no d$uction f income tax ,section      
#bge7;a77#f7 ( su* ,code is am5d$ by    
ins]t+ #ej;,b1 aft] #ej;,a14  7c7       
,failure ,to pay tax on specifi$        
settlem5t fund paym5ts ,"p ,i ( sub*apt]
 ,a ( *apt] #fh ( su* ,code is am5d$ by 
add+ at ! end ! foll[+ new section3     
#fffj4  ,failure to pay tax on specifi$ 
settlem5t fund paym5ts  ,any taxpay] :o1
 ) respect to any taxable ye>--  7#a7   

willfully fails to pay ! tax impos$ by  
section #ejjj;,e7a71 or  7#b7 willfully 
attempts 9 any mann] to evade or defeat 
su* tax or ! paym5t !re(1  %all1 9      
addition to o!r p5alties provid$ by law1
 be liable = a p5alty ( #ej p]c5t ( su* 
tax = su* taxable ye>4  4  7d7 ,cl]ical 
am5dm5ts  7#a7 ,! table ( *apt]s =      
subtitle ,d ( su* ,code is am5d$ by add+
 at ! end ! foll[+ new item3  ,*apt]    
#ej;,b--,specifi$ settlem5t fund paym5ts
  4  7#b7 ,! table ( sections = "p ,i ( 
sub*apt] ,a ( *apt] #fh ( su* ,code is  
am5d$ by add+ at ! end ! foll[+ new     
item3  ,sec4 #fffj4 ,failure to pay tax 
on specifi$ settlem5t fund paym5ts4  4  
7e7 ,effective dates  7#a7 ,9 g5]al     
,except z provid$ by p>agraph 7#b71 !   
am5dm5ts made by ?is section %all apply 
) respect to am\nts receiv$ on or aft]  
,may #bj1 #bjbf4  7#b7 ,failure to pay  
tax on specifi$ settlem5t fund paym5ts  
,! am5dm5t made by subsection 7c7 %all  
apply ) respect to taxable ye>s end+ on 
or aft] ,may #bj1 #bjbf4  #c4 ,returns  

relat+ to specifi$ settlem5t fund       
paym5ts  7a7 ,9 g5]al ,subp>t ,b ( "p   
,,iii ( sub*apt] ,a ( *apt] #fa ( !     
,int]nal ,rev5ue ,code ( #aihf is am5d$ 
by add+ at ! end ! foll[+ new section3  
#fjej;,,bb4 ,returns relat+ to specifi$ 
settlem5t fund paym5ts  7a7 ,requirem5t 
( report+ ,e tru/ee1 adm9i/rator1 or o!r
 fiduci>y :o makes any specifi$         
settlem5t fund paym5t 7z def9$ 9 section
 #ejjj;,e7b77 to any taxpay] dur+ any   
taxable ye> %all make a return1 accord+ 
to ! =ms & regulations prescrib$ by !   
,secret>y1 sett+ =?-- 7#a7 ! aggregate  
am\nt ( su* paym5ts receiv$ by su*      
taxpay] dur+ su* taxable ye>1 &  7#b7 ! 
"n & address ( su* taxpay]4  7b7        
,/atem5ts ,to be furni%$ ) respect to   
:om in=mation is requir$ ,e p]son       
requir$ to make a return "u subsection  
7a7 %all furni% to ea* taxpay] ^: "n is 
requir$ to be set =? 9 su* return a     
writt5 /atem5t--  7#a7 %[+ ! id5tity ( !
 tru/ee1 adm9i/rator1 or o!r fiduci>y   
mak+ ! specifi$ settlem5t fund paym5t1  

7#b7 %[+ ! aggregate am\nt ( su* paym5ts
 receiv$ by su* taxpay] requir$ to be   
%[n on ! return1 &  7#c7 notify+ t su*  
paym5ts are subject to ! tax impos$ by  
section #ejjj;,e7a74  ,! writt5 /atem5t 
requir$ "u ! prec$+ s5t5ce %all be      
furni%$ to ! taxpay] on or be=e ,janu>y 
#ca ( ! ye> foll[+ ! taxable ye> = :i* !
 return "u subsection 7a7 0 requir$ to  
be made4  7c7 ,public disclosure (      
returns ,! ,secret>y %all1 n lat] ?an #a
 mon? foll[+ receipt ( a return "u      
subsection 7a71 make su* return publicly
 available 79 su* =m & mann] z !        
,secret>y det]m9es appropriate74  4  7b7
 ,failure ,to file return ) respect to  
specifi$ settlem5t fund paym5ts ,section
 #ffeb ( su* ,code is am5d$ by add+ at !
 end ! foll[+ new subsection3  7q7      
,failure ,to file return ) respect to   
specifi$ settlem5t fund paym5ts  ,9 !   
case ( any failure to make a return     
requir$ "u section #fjej;,,bb :i*       
conta9s ! in=mation requir$ by su*      
section on ! date prescrib$ !re=1 unless

 x is %[n t su* failure is due to       
reasonable cause1 !re %all be paid 7on  
notice & dem& by ! ,secret>y & 9 ! same 
mann] z tax7 by ! p]son fail+ to file   
su* return1 an am\nt equal to #aj1jjj = 
ea* su* failure4  4  7c7 ,cl]ical       
am5dm5t ,! table ( sections = subp>t ,b 
( "p ,,iii ( sub*apt] ,a ( *apt] #fa (  
su* ,code is am5d$ by add+ at ! end !   
foll[+ new item3  ,sec4 #fjej;,,bb4     
,returns relat+ to specifi$ settlem5t   
fund paym5ts4  4  7d7 ,effective dates  
7#a7 ,9 g5]al ,except z provid$ by      
p>agraph 7#b71 ! am5dm5ts made by ?is   
section %all apply ) respect to am\nts  
paid on or aft] ,may #bj1 #bjbf4  7#b7  
,failure to file return ) respect to    
specifi$ settlem5t fund paym5ts ,!      
am5dm5t made by subsection 7b7 %all     
apply ) respect to taxable ye>s end+ on 
or aft] ,may #bj1 #bjbf4