Title II — 21st Century Irs

116th Congress · Approved Jul 1, 2019 · 133 Stat. 981

TITLE II 21st Century Irs

Subtitle A Cybersecurity and Identity Protection

SEC. 2001. Public-Private Partnership to Address Identity Theft Refund Fraud.

The Secretary of the Treasury (or the Secretary’s delegate) shall work collaboratively with the public and private sectors to protect taxpayers from identity theft refund fraud.

SEC. 2002. Recommendations of Electronic Tax Administration Advisory Committee Regarding Identity Theft Refund Fraud.

The Secretary of the Treasury shall ensure that the advisory group convened by the Secretary pursuant to section 2001(b)(2) of the Internal Revenue Service Restructuring and Reform Act of 1998 (commonly known as the Electronic Tax Administration Advisory Committee) studies (including by providing organized public forums) and makes recommendations to the Secretary regarding methods to prevent identity theft and refund fraud.

SEC. 2003. Information Sharing and Analysis Center.

(a)

In General.— The Secretary of the Treasury (or the Secretary’s delegate) may participate in an information sharing and analysis center to centralize, standardize, and enhance data compilation and analysis to facilitate sharing actionable data and information with respect to identity theft tax refund fraud.

(b)

Development of Performance Metrics.— The Secretary of the Treasury (or the Secretary’s delegate) shall develop metrics for measuring the success of such center in detecting and preventing identity theft tax refund fraud.

(c)

Disclosure.—

(1)

In general.— Section 6103(k), as amended by this Act, is amended by adding at the end the following new paragraph:

“(14) Disclosure of return information for purposes of cybersecurity and the prevention of identity theft tax refund fraud.—

“(A) In general.—Under such procedures and subject to such conditions as the Secretary may prescribe, the Secretary may disclose specified return information to specified ISAC participants to the extent that the Secretary determines such disclosure is in furtherance of effective Federal tax administration relating to the detection or prevention of identity theft tax refund fraud, validation of taxpayer identity, authentication of taxpayer returns, or detection or prevention of cybersecurity threats.

“(B) Specified isac participants.—For purposes of this paragraph—

“(i) In general.—The term ‘specified ISAC participant’ means—

“(I) any person designated by the Secretary as having primary responsibility for a function performed with respect to the information sharing and analysis center described in section 2003(a) of the Taxpayer First Act, and

“(II) any person subject to the requirements of section 7216 and which is a participant in such information sharing and analysis center.

“(ii) Information sharing agreement.—Such term shall not include any person unless such person has entered into a written agreement with the Secretary setting forth the terms and conditions for the disclosure of information to such person under this paragraph, including requirements regarding the protection and safeguarding of such information by such person.

“(C) Specified return information.—For purposes of this paragraph, the term ‘specified return information’ means—

“(i) in the case of a return which is in connection with a case of potential identity theft refund fraud—

“(I) in the case of such return filed electronically, the internet protocol address, device identification, email domain name, speed of completion, method of authentication, refund method, and such other return information related to the electronic filing characteristics of such return as the Secretary may identify for purposes of this subclause, and

“(II) in the case of such return prepared by a tax return preparer, identifying information with respect to such tax return preparer, including the preparer taxpayer identification number and electronic filer identification number of such preparer,

“(ii) in the case of a return which is in connection with a case of a identity theft refund fraud which has been confirmed by the Secretary (pursuant to such procedures as the Secretary may provide), the information referred to in subclauses (I) and (II) of clause (i), the name and taxpayer identification number of the taxpayer as it appears on the return, and any bank account and routing information provided for making a refund in connection with such return, and

“(iii) in the case of any cybersecurity threat to the Internal Revenue Service, information similar to the information described in subclauses (I) and (II) of clause (i) with respect to such threat.

“(D) Restriction on use of disclosed information.—

“(i) Designated third parties.—Any return information received by a person described in subparagraph (B)(i)(I) shall be used only for the purposes of and to the extent necessary in—

“(I) performing the function such person is designated to perform under such subparagraph,

“(II) facilitating disclosures authorized under subparagraph (A) to persons described in subparagraph (B)(i)(II), and

“(III) facilitating disclosures authorized under subsection (d) to participants in such information sharing and analysis center.

“(ii) Return preparers.—Any return information received by a person described in subparagraph (B)(i)(II) shall be treated for purposes of section 7216 as information furnished to such person for, or in connection with, the preparation of a return of the tax imposed under chapter 1.

“(E) Data protection and safeguards.—Return information disclosed under this paragraph shall be subject to such protections and safeguards as the Secretary may require in regulations or other guidance or in the written agreement referred to in subparagraph (B)(ii). Such written agreement shall include a requirement that any unauthorized access to information disclosed under this paragraph, and any breach of any system in which such information is held, be reported to the Treasury Inspector General for Tax Administration.”

(2)

Application of civil and criminal penalties.—

(A)

Section 6103(a)(3), as amended by this Act, is amended by striking “ or (13)” and inserting “ , (13), or (14)”.

(B)

Section 7213(a)(2), as amended by this Act, is amended by striking “ or (13)” and inserting “ , (13), or (14)”.

SEC. 2004. Compliance by Contractors with Confidentiality Safeguards.

(a)

In General.— Section 6103(p) is amended by adding at the end the following new paragraph:

“(9) Disclosure to contractors and other agents.—Notwithstanding any other provision of this section, no return or return information shall be disclosed to any contractor or other agent of a Federal, State, or local agency unless such agency, to the satisfaction of the Secretary—

“(A) has requirements in effect which require each such contractor or other agent which would have access to returns or return information to provide safeguards (within the meaning of paragraph (4)) to protect the confidentiality of such returns or return information,

“(B) agrees to conduct an on-site review every 3 years (or a mid-point review in the case of contracts or agreements of less than 3 years in duration) of each contractor or other agent to determine compliance with such requirements,

“(C) submits the findings of the most recent review conducted under subparagraph (B) to the Secretary as part of the report required by paragraph (4)(E), and

“(D) certifies to the Secretary for the most recent annual period that such contractor or other agent is in compliance with all such requirements.

(b)

Conforming Amendment.— Section 6103(p)(8)(B) is amended by inserting “ or paragraph (9)” after “ subparagraph (A)”.

(c)

Effective Date.— The amendments made by this section shall apply to disclosures made after December 31, 2022.

SEC. 2005. Identity Protection Personal Identification Numbers.

(a)

In General.— Subject to subsection (b), the Secretary of the Treasury or the Secretary’s delegate (hereafter referred to in this section as the “Secretary”) shall establish a program to issue, upon the request of any individual, a number which may be used in connection with such individual’s social security number (or other identifying information with respect to such individual as determined by the Secretary) to assist the Secretary in verifying such individual’s identity.

(b)

Requirements.—

(1)

Annual expansion.— For each calendar year beginning after the date of the enactment of this Act, the Secretary shall provide numbers through the program described in subsection (a) to individuals residing in such States as the Secretary deems appropriate, provided that the total number of States served by such program during such year is greater than the total number of States served by such program during the preceding year.

(2)

Nationwide availability.— Not later than 5 years after the date of the enactment of this Act, the Secretary shall ensure that the program described in subsection (a) is made available to any individual residing in the United States.

SEC. 2006. Single Point of Contact for Tax-Related Identity Theft Victims.

(a)

In General.— The Secretary of the Treasury (or the Secretary’s delegate) shall establish and implement procedures to ensure that any taxpayer whose return has been delayed or otherwise adversely affected due to tax-related identity theft has a single point of contact at the Internal Revenue Service throughout the processing of the taxpayer’s case. The single point of contact shall track the taxpayer’s case to completion and coordinate with other Internal Revenue Service employees to resolve case issues as quickly as possible.

(b)

Single Point of Contact.—

(1)

In general.— For purposes of subsection (a), the single point of contact shall consist of a team or subset of specially trained employees who—

(A)

have the ability to work across functions to resolve the issues involved in the taxpayer’s case; and

(B)

shall be accountable for handling the case until its resolution.

(2)

Team or subset.— The employees included within the team or subset described in paragraph (1) may change as required to meet the needs of the Internal Revenue Service, provided that procedures have been established to—

(A)

ensure continuity of records and case history; and

(B)

notify the taxpayer when appropriate.

SEC. 2007. Notification of Suspected Identity Theft.

(a)

In General.— Chapter 77 is amended by adding at the end the following new section:

“SEC. 7529. NOTIFICATION OF SUSPECTED IDENTITY THEFT.

“(a) In General.—If the Secretary determines that there has been or may have been an unauthorized use of the identity of any individual, the Secretary shall, without jeopardizing an investigation relating to tax administration—

“(1) as soon as practicable—

“(A) notify the individual of such determination,

“(B) provide instructions on how to file a report with law enforcement regarding the unauthorized use,

“(C) identify any steps to be taken by the individual to permit law enforcement to access personal information of the individual during the investigation,

“(D) provide information regarding actions the individual may take in order to protect the individual from harm relating to the unauthorized use, and

“(E) offer identity protection measures to the individual, such as the use of an identity protection personal identification number, and

“(2) at the time the information described in paragraph (1) is provided (or, if not available at such time, as soon as practicable thereafter), issue additional notifications to such individual (or such individual’s designee) regarding—

“(A) whether an investigation has been initiated in regards to such unauthorized use,

“(B) whether the investigation substantiated an unauthorized use of the identity of the individual, and

“(C) whether—

“(i) any action has been taken against a person relating to such unauthorized use, or

“(ii) any referral has been made for criminal prosecution of such person and, to the extent such information is available, whether such person has been criminally charged by indictment or information.

“(b) Employment-Related Identity Theft.—

“(1) In general.—For purposes of this section, the unauthorized use of the identity of an individual includes the unauthorized use of the identity of the individual to obtain employment.

“(2) Determination of employment-related identity theft.—For purposes of this section, in making a determination as to whether there has been or may have been an unauthorized use of the identity of an individual to obtain employment, the Secretary shall review any information—

“(A) obtained from a statement described in section 6051 or an information return relating to compensation for services rendered other than as an employee, or

“(B) provided to the Internal Revenue Service by the Social Security Administration regarding any statement described in section 6051,

(b)

Additional Measures.—

(1)

Examination of both paper and electronic statements and returns.— The Secretary of the Treasury (or the Secretary’s delegate) shall examine the statements, information returns, and tax returns described in section 7529(b)(2) of the Internal Revenue Code of 1986 (as added by subsection (a)) for any evidence of employment-related identity theft, regardless of whether such statements or returns are submitted electronically or on paper.

(2)

Improvement of effective return processing program with social security administration.— Section 232 of the Social Security Act (42 U.S.C. 432) is amended by inserting after the third sentence the following: “ For purposes of carrying out the return processing program described in the preceding sentence, the Commissioner of Social Security shall request, not less than annually, such information described in section 7529(b)(2) of the Internal Revenue Code of 1986 as may be necessary to ensure the accuracy of the records maintained by the Commissioner of Social Security related to the amounts of wages paid to, and the amounts of self-employment income derived by, individuals.”.

(3)

Underreporting of income.— The Secretary of the Treasury (or the Secretary’s delegate) shall establish procedures to ensure that income reported in connection with the unauthorized use of a taxpayer’s identity is not taken into account in determining any penalty for underreporting of income by the victim of identity theft.

(c)

Clerical Amendment.— The table of sections for chapter 77 is amended by adding at the end the following new item:

“Sec. 7529. Notification of suspected identity theft.”.

(d)

Effective Date.— The amendments made by this section shall apply to determinations made after the date that is 6 months after the date of the enactment of this Act.

SEC. 2008. Guidelines for Stolen Identity Refund Fraud Cases.

(a)

In General.— Not later than 1 year after the date of the enactment of this Act, the Secretary of the Treasury (or the Secretary’s delegate), in consultation with the National Taxpayer Advocate, shall develop and implement publicly available guidelines for management of cases involving stolen identity refund fraud in a manner that reduces the administrative burden on taxpayers who are victims of such fraud.

(b)

Standards and Procedures To Be Considered.— The guidelines described in subsection (a) may include—

(1)

standards for—

(A)

the average length of time in which a case involving stolen identity refund fraud should be resolved;

(B)

the maximum length of time, on average, a taxpayer who is a victim of stolen identity refund fraud and is entitled to a tax refund which has been stolen should have to wait to receive such refund; and

(C)

the maximum number of offices and employees within the Internal Revenue Service with whom a taxpayer who is a victim of stolen identity refund fraud should be required to interact in order to resolve a case;

(2)

standards for opening, assigning, reassigning, or closing a case involving stolen identity refund fraud; and

(3)

procedures for implementing and accomplishing the standards described in paragraphs (1) and (2), and measures for evaluating such procedures and determining whether such standards have been successfully implemented.

SEC. 2009. Increased Penalty for Improper Disclosure or Use of Information by Preparers of Returns.

(a)

In General.— Section 6713 is amended—

(1)

by redesignating subsections (b) and (c) as subsections (c) and (d), respectively; and

(2)

by inserting after subsection (a) the following new subsection:

“(b) Enhanced Penalty for Improper Use or Disclosure Relating to Identity Theft.—

“(1) In general.—In the case of a disclosure or use described in subsection (a) that is made in connection with a crime relating to the misappropriation of another person’s taxpayer identity (as defined in section 6103(b)(6)), whether or not such crime involves any tax filing, subsection (a) shall be applied—

“(A) by substituting ‘$1,000’ for ‘$250’, and

“(B) by substituting ‘$50,000’ for ‘$10,000’.

“(2) Separate application of total penalty limitation.—The limitation on the total amount of the penalty under subsection (a) shall be applied separately with respect to disclosures or uses to which this subsection applies and to which it does not apply.”

(b)

Criminal Penalty.— Section 7216(a) is amended by striking “ $1,000” and inserting “ $1,000 ($100,000 in the case of a disclosure or use to which section 6713(b) applies)”.

(c)

Effective Date.— The amendments made by this section shall apply to disclosures or uses on or after the date of the enactment of this Act.

Subtitle B Development of Information Technology

SEC. 2101. Management of Internal Revenue Service Information Technology.

(a)

Duties and Responsibilities of Internal Revenue Service Chief Information Officer.— Section 7803, as amended by section 1001, is amended by adding at the end the following new subsection:

“(f) Internal Revenue Service Chief Information Officer.—

“(1) In general.—There shall be in the Internal Revenue Service an Internal Revenue Service Chief Information Officer (hereafter referred to in this subsection as the ‘IRS CIO’) who shall be appointed by the Commissioner of Internal Revenue.

“(2) Centralized responsibility for internal revenue service information technology.—The Commissioner of Internal Revenue (and the Secretary) shall act through the IRS CIO with respect to all development, implementation, and maintenance of information technology for the Internal Revenue Service. Any reference in this subsection to the IRS CIO which directs the IRS CIO to take any action, or to assume any responsibility, shall be treated as a reference to the Commissioner of Internal Revenue acting through the IRS CIO.

“(3) General duties and responsibilities.—The IRS CIO shall—

“(A) be responsible for the development, implementation, and maintenance of information technology for the Internal Revenue Service,

“(B) ensure that the information technology of the Internal Revenue Service is secure and integrated,

“(C) maintain operational control of all information technology for the Internal Revenue Service,

“(D) be the principal advocate for the information technology needs of the Internal Revenue Service, and

“(E) consult with the Chief Procurement Officer of the Internal Revenue Service to ensure that the information technology acquired for the Internal Revenue Service is consistent with—

“(i) the goals and requirements specified in subparagraphs (A) through (D), and

“(ii) the strategic plan developed under paragraph (4).

“(4) Strategic plan.—

“(A) In general.—The IRS CIO shall develop and implement a multiyear strategic plan for the information technology needs of the Internal Revenue Service. Such plan shall—

“(i) include performance measurements of such technology and of the implementation of such plan,

“(ii) include a plan for an integrated enterprise architecture of the information technology of the Internal Revenue Service,

“(iii) include and take into account the resources needed to accomplish such plan,

“(iv) take into account planned major acquisitions of information technology by the Internal Revenue Service, and

“(v) align with the needs and strategic plan of the Internal Revenue Service.

“(B) Plan updates.—The IRS CIO shall, not less frequently than annually, review and update the strategic plan under subparagraph (A) (including the plan for an integrated enterprise architecture described in subparagraph (A)(ii)) to take into account the development of new information technology and the needs of the Internal Revenue Service.

“(5) Scope of authority.—

“(A) Information technology.—For purposes of this subsection, the term ‘information technology’ has the meaning given such term by section 11101 of title 40, United States Code.

“(B) Internal revenue service.—Any reference in this subsection to the Internal Revenue Service includes a reference to all components of the Internal Revenue Service, including—

“(i) the Office of the Taxpayer Advocate,

“(ii) the Criminal Investigation Division of the Internal Revenue Service, and

“(iii) except as otherwise provided by the Secretary with respect to information technology related to matters described in subsection (b)(3)(B), the Office of the Chief Counsel.”

(b)

Independent Verification and Validation of the Customer Account Data Engine 2 and Enterprise Case Management System.—

(1)

In general.— The Commissioner of Internal Revenue shall enter into a contract with an independent reviewer to verify and validate the implementation plans (including the performance milestones and cost estimates included in such plans) developed for the Customer Account Data Engine 2 and the Enterprise Case Management System.

(2)

Deadline for completion.— Such contract shall require that such verification and validation be completed not later than the date which is 1 year after the date of the enactment of this Act.

(3)

Application to phases of cade 2.—

(A)

In general.— Paragraphs (1) and (2) shall not apply to phase 1 of the Customer Account Data Engine 2 and shall apply separately to each other phase.

(B)

Deadline for completing plans.— Not later than 1 year after the date of the enactment of this Act, the Commissioner of Internal Revenue shall complete the development of plans for all phases of the Customer Account Data Engine 2.

(C)

Deadline for completion of verification and validation of plans.— In the case of any phase after phase 2 of the Customer Account Data Engine 2, paragraph (2) shall be applied by substituting “the date on which the plan for such phase was completed” for “the date of the enactment of this Act”.

(c)

Coordination of IRS CIO and Chief Procurement Officer of the Internal Revenue Service.—

(1)

In general.— The Chief Procurement Officer of the Internal Revenue Service shall—

(A)

identify all significant IRS information technology acquisitions and provide written notification to the Internal Revenue Service Chief Information Officer (hereafter referred to in this subsection as the “IRS CIO”) of each such acquisition in advance of such acquisition, and

(B)

regularly consult with the IRS CIO regarding acquisitions of information technology for the Internal Revenue Service, including meeting with the IRS CIO regarding such acquisitions upon request.

(2)

Significant irs information technology acquisitions.— For purposes of this subsection, the term “significant IRS information technology acquisitions” means—

(A)

any acquisition of information technology for the Internal Revenue Service in excess of $1 million; and

(B)

such other acquisitions of information technology for the Internal Revenue Service (or categories of such acquisitions) as the IRS CIO, in consultation with the Chief Procurement Officer of the Internal Revenue Service, may identify.

(3)

Scope.— Terms used in this subsection which are also used in section 7803(f) of the Internal Revenue Code of 1986 (as added by subsection (a)) shall have the same meaning as when used in such section.

SEC. 2102. Internet Platform for Form 1099 Filings.

(a)

In General.— Not later than January 1, 2023, the Secretary of the Treasury or the Secretary’s delegate (hereafter referred to in this section as the “Secretary”) shall make available an internet website or other electronic media, with a user interface and functionality similar to the Business Services Online Suite of Services provided by the Social Security Administration, that provides access to resources and guidance provided by the Internal Revenue Service and allows persons to—

(1)

prepare and file Forms 1099;

(2)

prepare Forms 1099 for distribution to recipients other than the Internal Revenue Service; and

(3)

maintain a record of completed, filed, and distributed Forms 1099.

(b)

Electronic Services Treated as Supplemental; Application of Security Standards.— The Secretary shall ensure that the services described in subsection (a)—

(1)

are a supplement to, and not a replacement for, other services provided by the Internal Revenue Service to taxpayers; and

(2)

comply with applicable security standards and guidelines.

SEC. 2103. Streamlined Critical Pay Authority for Information Technology Positions.

(a)

In General.— Subchapter A of chapter 80 is amended by adding at the end the following new section:

“SEC. 7812. STREAMLINED CRITICAL PAY AUTHORITY FOR INFORMATION TECHNOLOGY POSITIONS.

“In the case of any position which is critical to the functionality of the information technology operations of the Internal Revenue Service—

“(1) section 9503 of title 5, United States Code, shall be applied—

“(A) by substituting ‘during the period beginning on the date of the enactment of section 7812 of the Internal Revenue Code of 1986, and ending on September 30, 2025’ for ‘Before September 30, 2013 in subsection (a)’,

“(B) without regard to subparagraph (B) of subsection (a)(1), and

“(C) by substituting ‘the date of the enactment of the Taxpayer First Act’ for ‘June 1, 1998’ in subsection (a)(6),

“(2) section 9504 of such title 5 shall be applied by substituting ‘During the period beginning on the date of the enactment of section 7812 of the Internal Revenue Code of 1986, and ending on September 30, 2025’ for ‘Before September 30, 2013’ each place it appears in subsections (a) and (b), and

“(3) section 9505 of such title shall be applied—

“(A) by substituting ‘During the period beginning on the date of the enactment of section 7812 of the Internal Revenue Code of 1986, and ending on September 30, 2025’ for ‘Before September 30, 2013’ in subsection (a), and

“(B) by substituting ‘the information technology operations’ for ‘significant functions’ in subsection (a).”

(b)

Clerical Amendment.— The table of sections for subchapter A of chapter 80 is amended by adding at the end the following new item:

“Sec. 7812. Streamlined critical pay authority for information technology positions.”.

Subtitle C Modernization of Consent-Based Income Verification System

SEC. 2201. Disclosure of Taxpayer Information for Third-Party Income Verification.

(a)

In General.— Not later than 1 year after the close of the 2-year period described in subsection (d)(1), the Secretary of the Treasury or the Secretary’s delegate (hereafter referred to in this section as the “Secretary”) shall implement a program to ensure that any qualified disclosure—

(1)

is fully automated and accomplished through the internet; and

(2)

is accomplished in as close to real-time as is practicable.

(b)

Qualified Disclosure.— For purposes of this section, the term “qualified disclosure” means a disclosure under section 6103(c) of the Internal Revenue Code of 1986 of returns or return information 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.

(c)

Application of Security Standards.— The Secretary shall ensure that the program described in subsection (a) complies with applicable security standards and guidelines.

(d)

User Fee.—

(1)

In general.— During the 2-year period beginning on the first day of the sixth calendar month beginning after the date of the enactment of this Act, the Secretary shall assess and collect a fee for qualified disclosures (in addition to any other fee assessed and collected for such disclosures) at such rates as the Secretary determines are sufficient to cover the costs related to implementing the program described in subsection (a), including the costs of any necessary infrastructure or technology.

(2)

Deposit of collections.— Amounts received from fees assessed and collected under paragraph (1) shall be deposited in, and credited to, an account solely for the purpose of carrying out the activities described in subsection (a). Such amounts shall be available to carry out such activities without need of further appropriation and without fiscal year limitation.

SEC. 2202. Limit Redisclosures and Uses of Consent-Based Disclosures of Tax Return Information.

(a)

In General.— Section 6103(c) is amended by adding at the end the following: “ Persons designated by the taxpayer under this subsection to receive return information shall not use the information for any purpose other than the express purpose for which consent was granted and shall not disclose return information to any other person without the express permission of, or request by, the taxpayer.”.

(b)

Application of Penalties.— Section 6103(a)(3) is amended by inserting “ subsection (c),” after “ return information under”.

(c)

Effective Date.— The amendments made by this section shall apply to disclosures made after the date which is 180 days after the date of the enactment of this Act.

Subtitle D Expanded Use of Electronic Systems

SEC. 2301. Electronic Filing of Returns.

(a)

In General.— Section 6011(e)(2)(A) is amended by striking “ 250” and inserting “ the applicable number of”.

(b)

Applicable Number.— Section 6011(e) is amended by striking paragraph (5) and inserting the following new paragraphs:

“(5) Applicable number.—

“(A) In general.—For purposes of paragraph (2)(A), the applicable number shall be—

“(i) except as provided in subparagraph (B), in the case of calendar years before 2021, 250,

“(ii) in the case of calendar year 2021, 100, and

“(iii) in the case of calendar years after 2021, 10.

“(B) Special rule for partnerships for 2018, 2019, 2020, and 2021.—In the case of a partnership, for any calendar year before 2022, the applicable number shall be—

“(i) in the case of calendar year 2018, 200,

“(ii) in the case of calendar year 2019, 150,

“(iii) in the case of calendar year 2020, 100, and

“(iv) in the case of calendar year 2021, 50.

“(6) Partnerships required to file on magnetic media.—Notwithstanding paragraph (2)(A), the Secretary shall require partnerships having more than 100 partners to file returns on magnetic media.”

(c)

Returns Filed by a Tax Return Preparer.— Section 6011(e)(3) is amended by adding at the end the following new subparagraph:

“(D) Exception for certain preparers located in areas without internet access.—The Secretary may waive the requirement of subparagraph (A) if the Secretary determines, on the basis of an application by the tax return preparer, that the preparer cannot meet such requirement by reason of being located in a geographic area which does not have access to internet service (other than dial-up or satellite service).”

(d)

Conforming Amendment.— Section 6724(c) is amended by striking “ 250 information returns (more than 100 information returns in the case of a partnership having more than 100 partners)” and inserting “ the applicable number (determined under section 6011(e)(5) with respect to the calendar year to which such returns relate) of information returns”.

(e)

Effective Date.— The amendments made by this section shall take effect on the date of the enactment of this Act.

SEC. 2302. Uniform Standards for the Use of Electronic Signatures for Disclosure Authorizations to, and Other Authorizations of, Practitioners.

Section 6061(b)(3) is amended to read as follows:

“(3) Published guidance.—

“(A) In general.—The Secretary shall publish guidance as appropriate to define and implement any waiver of the signature requirements or any method adopted under paragraph (1).

“(B) Electronic signatures for disclosure authorizations to, and other authorizations of, practitioners.—Not later than 6 months after the date of the enactment of this subparagraph, the Secretary shall publish guidance to establish uniform standards and procedures for the acceptance of taxpayers’ signatures appearing in electronic form with respect to any request for disclosure of a taxpayer’s return or return information under section 6103(c) to a practitioner or any power of attorney granted by a taxpayer to a practitioner.

“(C) Practitioner.—For purposes of subparagraph (B), the term ‘practitioner’ means any individual in good standing who is regulated under section 330 of title 31, United States Code.”

SEC. 2303. Payment of Taxes by Debit and Credit Cards.

Section 6311(d)(2) is amended by adding at the end the following: “ The preceding sentence shall not apply to the extent that the Secretary ensures that any such fee or other consideration is fully recouped by the Secretary in the form of fees paid to the Secretary by persons paying taxes imposed under subtitle A with credit, debit, or charge cards pursuant to such contract. Notwithstanding the preceding sentence, the Secretary shall seek to minimize the amount of any fee or other consideration that the Secretary pays under any such contract.”.

SEC. 2304. Authentication of Users of Electronic Services Accounts.

Beginning 180 days after the date of the enactment of this Act, the Secretary of the Treasury (or the Secretary’s delegate) shall verify the identity of any individual opening an e-Services account with the Internal Revenue Service before such individual is able to use the e-Services tools.

Subtitle E Other Provisions

SEC. 2401. Repeal of Provision Regarding Certain Tax Compliance Procedures and Reports.

Section 2004 of the Internal Revenue Service Restructuring and Reform Act of 1998 (26 U.S.C. 6012 note) is repealed.

SEC. 2402. Comprehensive Training Strategy.

Not later than 1 year after the date of the enactment of this Act, the Commissioner of Internal Revenue shall submit to Congress a written report providing a comprehensive training strategy for employees of the Internal Revenue Service, including—

(1)

a plan to streamline current training processes, including an assessment of the utility of further consolidating internal training programs, technology, and funding;

(2)

a plan to develop annual training regarding taxpayer rights, including the role of the Office of the Taxpayer Advocate, for employees that interface with taxpayers and the direct managers of such employees;

(3)

a plan to improve technology-based training;

(4)

proposals to—

(A)

focus employee training on early, fair, and efficient resolution of taxpayer disputes for employees that interface with taxpayers and the direct managers of such employees; and

(B)

ensure consistency of skill development and employee evaluation throughout the Internal Revenue Service; and

(5)

a thorough assessment of the funding necessary to implement such strategy.

Title II — 21st Century Irs