H.R. 22 (103rd): Federal Program Improvement Act of 1993

103rd Congress, 1993–1994. Text as of Sep 14, 1993 (Introduced).

Status & Summary | PDF | Source: GPO

HR 22 SC

103d CONGRESS

1st Session

H. R. 22

To make certain changes to improve the administration of the medicare program, to reform customs overtime pay practices, to prevent the payment of Federal benefits to deceased individuals, to require reports on employers with underfunded pension plans, to provide for increased taxpayer procedural protections, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

January 5, 1993

Mr. PICKLE (for himself, Mr. ROSTENKOWSKI, Mr. STARK, Mr. RANGEL, Mr. JACOBS, Mr. FORD of Tennessee, Mr. THOMAS of California, Mr. SUNDQUIST, and Mr. SHAW) introduced the following bill; which was referred jointly to the Committees on Ways and Means, Energy and Commerce, and Post Office and Civil Service

September 14, 1993

Additional sponsors: Ms. EDDIE BERNICE JOHNSON of Texas, Mr. SWIFT, Mr. BARLOW, Mr. CRAMER, Mr. RICHARDSON, Mrs. LLOYD, Mr. GORDON, and Mr. STRICKLAND


A BILL

To make certain changes to improve the administration of the medicare program, to reform customs overtime pay practices, to prevent the payment of Federal benefits to deceased individuals, to require reports on employers with underfunded pension plans, to provide for increased taxpayer procedural protections, and for other purposes.

    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 Program Improvement Act of 1993’.

TITLE I--PROVISIONS RELATING TO THE MEDICARE PROGRAM

SEC. 1000. REFERENCES IN TITLE.

    (a) AMENDMENTS TO SOCIAL SECURITY ACT- Except as otherwise specifically provided, whenever in this title an amendment is expressed in terms of an amendment to or repeal of a section or other provision, the reference shall be considered to be made to that section or other provision of the Social Security Act.

    (b) REFERENCES TO OBRA- In this Act, the terms ‘OBRA-1989’ and ‘OBRA-1990’ refer to the Omnibus Budget Reconciliation Act of 1989 (Public Law 101-239) and the Omnibus Budget Reconciliation Act of 1990 (Public Law 101-508), respectively.

Subtitle A--Durable Medical Equipment

SEC. 1001. CERTIFICATION OF SUPPLIERS.

    (a) REQUIREMENTS-

      (1) IN GENERAL- Section 1834 (42 U.S.C. 1395m) is amended by adding at the end the following new subsection:

    ‘(i) REQUIREMENTS FOR SUPPLIERS OF MEDICAL EQUIPMENT AND SUPPLIES-

      ‘(1) ISSUANCE AND RENEWAL OF SUPPLIER NUMBER-

        ‘(A) PAYMENT- Except as provided in subparagraph (C), no payment may be made under this part after October 1, 1993, for items furnished by a supplier of medical equipment and supplies unless such supplier obtains (and renews at such intervals as the Secretary may require) a supplier number.

        ‘(B) STANDARDS FOR POSSESSING A SUPPLIER NUMBER- A supplier may not obtain a supplier number unless--

          ‘(i) for medical equipment and supplies furnished on or after October 1, 1993, and on or before December 31, 1994, the supplier meets standards prescribed by the Secretary; and

          ‘(ii) for medical equipment and supplies furnished on or after January 1, 1995, the supplier meets revised standards prescribed by the Secretary (in consultation with representatives of suppliers of medical equipment and supplies, carriers, and consumers) that shall include requirements that the supplier--

            ‘(I) comply with all applicable State and Federal licensure and regulatory requirements;

            ‘(II) maintain a physical facility on an appropriate site;

            ‘(III) have proof of appropriate liability insurance; and

            ‘(IV) meet such other requirements as the Secretary may specify.

        ‘(C) EXCEPTION FOR ITEMS FURNISHED AS INCIDENT TO A PHYSICIAN’S SERVICE- Subparagraph (A) shall not apply with respect to medical equipment and supplies furnished as an incident to a physician’s service.

        ‘(D) PROHIBITION AGAINST MULTIPLE SUPPLIER NUMBERS- The Secretary may not issue more than one supplier number to any supplier of medical equipment and supplies unless the issuance of more than one number is appropriate to identify subsidiary or regional entities under the supplier’s ownership or control.

        ‘(E) PROHIBITION AGAINST DELEGATION OF SUPPLIER DETERMINATIONS- The Secretary may not delegate (other than by contract under section 1842) the responsibility to determine whether suppliers meet the standards necessary to obtain a supplier number.

      ‘(2) CERTIFICATES OF MEDICAL NECESSITY-

        ‘(A) STANDARDIZED CERTIFICATES- Not later than October 1, 1993, the Secretary shall, in consultation with carriers under this part, develop one or more standardized certificates of medical necessity (as defined in subparagraph (C)) for medical equipment and supplies for which the Secretary determines that such a certificate is necessary.

        ‘(B) PROHIBITION AGAINST DISTRIBUTION BY SUPPLIERS OF CERTIFICATES OF MEDICAL NECESSITY-

          ‘(i) IN GENERAL- Except as provided in clause (ii), a supplier of medical equipment and supplies may not distribute to physicians or to individuals entitled to benefits under this part for commercial purposes any completed or partially completed certificates of medical necessity on or after October 1, 1993.

          ‘(ii) EXCEPTION FOR CERTAIN BILLING INFORMATION- Clause (i) shall not apply with respect to a certificate of medical necessity for any item that is not contained on the list of potentially overused items developed by the Secretary under subsection (a)(15)(A) to the extent that such certificate contains only information completed by the supplier of medical equipment and supplies identifying such supplier and the beneficiary to whom such medical equipment and supplies are furnished, a description of such medical equipment and supplies, any product code identifying such medical equipment and supplies, and any other administrative information (other than information relating to the beneficiary’s medical condition) identified by the Secretary. In the event a supplier provides a certificate of medical necessity containing information permitted under this clause, such certificate shall also contain the fee schedule amount and the supplier’s charge for the medical equipment or supplies being furnished prior to distribution of such certificate to the physician.

          ‘(iii) PENALTY- Any supplier of medical equipment and supplies who knowingly and willfully distributes a certificate of medical necessity in violation of clause (i) is subject to a civil money penalty in an amount not to exceed $1,000 for each such certificate of medical necessity so distributed. The provisions of section 1128A (other than subsections (a) and (b)) shall apply to civil money penalties under this subparagraph in the same manner as they apply to a penalty or proceeding under section 1128A(a).

        ‘(C) DEFINITION- For purposes of this paragraph, the term ‘certificate of medical necessity’ means a form or other document containing information required by the Secretary to be submitted to show that a covered item is reasonable and necessary for the diagnosis or treatment of illness or injury or to improve the functioning of a malformed body member.

      ‘(3) COVERAGE AND REVIEW CRITERIA-

        ‘(A) DEVELOPMENT AND ESTABLISHMENT- Not later than January 1, 1995, the Secretary, in consultation with representatives of suppliers of medical equipment and supplies, individuals enrolled under this part, and appropriate medical specialty societies, shall develop and establish uniform national coverage and utilization review criteria for 200 items of medical equipment and supplies selected in accordance with the standards described in subparagraph (B). The Secretary shall publish the criteria as part of the instructions provided to fiscal intermediaries and carriers under this part and no further publication, including publication in the Federal Register, shall be required.

        ‘(B) STANDARDS FOR SELECTING ITEMS SUBJECT TO CRITERIA- The Secretary may select an item for coverage under the criteria developed and established under subparagraph (A) if the Secretary finds that--

          ‘(i) the item is frequently purchased or rented by beneficiaries;

          ‘(ii) the item is frequently subject to a determination that such item is not medically necessary; or

          ‘(iii) the coverage or utilization criteria applied to the item (as of the date of the enactment of this subsection) is not consistent among carriers.

        ‘(C) ANNUAL REVIEW AND EXPANSION OF ITEMS SUBJECT TO CRITERIA- The Secretary shall annually review the coverage and utilization of items of medical equipment and supplies to determine whether items not included among the items selected under subparagraph (A) should be made subject to uniform national coverage and utilization review criteria, and, if appropriate, shall develop and apply such criteria to such additional items.

      ‘(4) DEFINITION- The term ‘medical equipment and supplies’ means--

        ‘(A) durable medical equipment (as defined in section 1861(n));

        ‘(B) prosthetic devices (as described in section 1861(s)(8));

        ‘(C) orthotics and prosthetics (as described in section 1861(s)(9));

        ‘(D) surgical dressings (as described in section 1861(s)(5));

        ‘(E) such other items as the Secretary may determine; and

        ‘(F) for purposes of paragraphs (1) and (3)--

          ‘(i) home dialysis supplies and equipment (as described in section 1861(s)(2)(F)), and

          ‘(ii) immunosuppressive drugs (as described in section 1861(s)(2)(J)).’.

    (2) CONFORMING AMENDMENT- Effective October 1, 1993, paragraph (16) of section 1834(a) (42 U.S.C. 1395m(a)) is repealed.

    (b) REPORT ON EFFECT OF UNIFORM CRITERIA ON UTILIZATION OF ITEMS- Not later than July 1, 1995, the Secretary shall submit a report to the Committee on Ways and Means and the Committee on Energy and Commerce of the House of Representatives and the Committee on Finance of the Senate analyzing the impact of the uniform criteria established under section 1834(i)(3)(A) of the Social Security Act (as added by subsection (a)) on the utilization of items of medical equipment and supplies by individuals enrolled under part B of the medicare program.

    (c) USE OF COVERED ITEMS BY DISABLED BENEFICIARIES-

      (1) IN GENERAL- The Secretary of Health and Human Services, in consultation with representatives of suppliers of durable medical equipment under part B of the medicare program and individuals entitled to benefits under such program on the basis of disability, shall conduct a study of the effects of the methodology for determining payments for items of such equipment under such part on the ability of such individuals to obtain items of such equipment, including customized items.

      (2) REPORT- Not later than May 1, 1994, the Secretary shall submit a report to Congress on the study conducted under paragraph (1), and shall include in the report such recommendations as the Secretary considers appropriate to assure that disabled medicare beneficiaries have access to items of durable medical equipment.

    (d) CRITERIA FOR TREATMENT OF ITEMS AS PROSTHETICS DEVICES OR ORTHOTICS AND PROSTHETICS- Not later than July 1, 1994, the Secretary of Health and Human Services shall submit a report to the Committees on Ways and Means and Energy and Commerce of the House of Representatives and the Committee on Finance of the Senate describing prosthetic devices or orthotics and prosthetics covered under part B of the medicare program that do not require individualized or custom fitting and adjustment to be used by a patient. Such report shall include recommendations for an appropriate methodology for determining the amount of payment for such items under such program.

SEC. 1002. PROHIBITION AGAINST CARRIER FORUM SHOPPING.

    (a) IN GENERAL- Section 1834(a)(12) (42 U.S.C. 1395m(a)(12)) is amended to read as follows:

      ‘(12) USE OF CARRIERS TO PROCESS CLAIMS-

        ‘(A) DESIGNATION OF REGIONAL CARRIERS- The Secretary may designate, by regulation under section 1842, one carrier for one or more entire regions to process all claims within the region for covered items under this section.

        ‘(B) PROHIBITION AGAINST CARRIER SHOPPING- (i) No supplier of a covered item may present or cause to be presented a claim for payment under this part unless such claim is presented to the appropriate regional carrier (as designated by the Secretary).

        ‘(ii) For purposes of clause (i), the term ‘appropriate regional carrier’ means the carrier having jurisdiction over the geographic area that includes the permanent residence of the patient to whom the item is furnished.’.

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to items furnished on or after October 1, 1993.

    (c) CLARIFICATION OF AUTHORITY TO DESIGNATE CARRIERS FOR OTHER ITEMS AND SERVICES- Nothing in this subsection or the amendment made by this subsection may be construed to restrict the authority of the Secretary of Health and Human Services to designate regional carriers or modify claims jurisdiction rules with respect to items or services under part B of the medicare program that are not covered items under section 1834(a) of the Social Security Act or prosthetic devices or orthotics and prosthetics under section 1834(h) of such Act.

SEC. 1003. RESTRICTIONS ON CERTAIN MARKETING AND SALES ACTIVITIES.

    (a) PROHIBITING UNSOLICITED TELEPHONE CONTACTS FROM SUPPLIERS OF DURABLE MEDICAL EQUIPMENT TO MEDICARE BENEFICIARIES-

      (1) IN GENERAL- Section 1834(a) (42 U.S.C. 1395m(a)) is amended by adding at the end the following new paragraph:

      ‘(17) PROHIBITION AGAINST UNSOLICITED TELEPHONE CONTACTS BY SUPPLIERS-

        ‘(A) IN GENERAL- A supplier of a covered item under this subsection may not contact an individual enrolled under this part by telephone regarding the furnishing of a covered item to the individual (other than a covered item the supplier has already furnished to the individual) unless--

          ‘(i) the individual gives permission to the supplier to make contact by telephone for such purpose; or

          ‘(ii) the supplier has furnished a covered item under this subsection to the individual during the 15-month period preceding the date on which the supplier contacts the individual for such purpose.

        ‘(B) PROHIBITING PAYMENT FOR ITEMS FURNISHED SUBSEQUENT TO UNSOLICITED CONTACTS- If a supplier knowingly contacts an individual in violation of subparagraph (A), no payment may be made under this part for any item subsequently furnished to the individual by the supplier.

        ‘(C) EXCLUSION FROM PROGRAM FOR SUPPLIERS ENGAGING IN PATTERN OF UNSOLICITED CONTACTS- If a supplier knowingly contacts individuals in violation of subparagraph (A) to such an extent that the supplier’s conduct establishes a pattern of contacts in violation of such subparagraph, the Secretary shall exclude the supplier from participation in the programs under this Act, in accordance with the procedures set forth in subsections (c), (f), and (g) of section 1128.’.

      (2) REQUIRING REFUND OF AMOUNTS COLLECTED FOR DISALLOWED ITEMS- Section 1834(a) (42 U.S.C. 1395m(a)), as amended by paragraph (1), is amended by adding at the end the following new paragraph:

      ‘(18) REFUND OF AMOUNTS COLLECTED FOR CERTAIN DISALLOWED ITEMS-

        ‘(A) IN GENERAL- If a nonparticipating supplier furnishes to an individual enrolled under this part a covered item for which no payment may be made under this part by reason of paragraph (17)(B), the supplier shall refund on a timely basis to the patient (and shall be liable to the patient for) any amounts collected from the patient for the item, unless--

          ‘(i) the supplier establishes that the supplier did not know and could not reasonably have been expected to know that payment may not be made for the item by reason of paragraph (17)(B), or

          ‘(ii) before the item was furnished, the patient was informed that payment under this part may not be made for that item and the patient has agreed to pay for that item.

        ‘(B) SANCTIONS- If a supplier knowingly and willfully fails to make refunds in violation of subparagraph (A), the Secretary may apply sanctions against the supplier in accordance with section 1842(j)(2).

        ‘(C) NOTICE- Each carrier with a contract in effect under this part with respect to suppliers of covered items shall send any notice of denial of payment for covered items by reason of paragraph (17)(B) and for which payment is not requested on an assignment-related basis to the supplier and the patient involved.

        ‘(D) TIMELY BASIS DEFINED- A refund under subparagraph (A) is considered to be on a timely basis only if--

          ‘(i) in the case of a supplier who does not request reconsideration or seek appeal on a timely basis, the refund is made within 30 days after the date the supplier receives a denial notice under subparagraph (C), or

          ‘(ii) in the case in which such a reconsideration or appeal is taken, the refund is made within 15 days after the date the supplier receives notice of an adverse determination on reconsideration or appeal.’.

    (b) CONFORMING AMENDMENT- Section 1834(h)(3) (42 U.S.C. 1395m(h)(3)) is amended by striking ‘Paragraph (12)’ and inserting ‘Paragraphs (12) and (17)’.

    (c) EFFECTIVE DATE- The amendments made by subsections (a) and (b) shall apply to items furnished after the expiration of the 60-day period that begins on the date of the enactment of this Act.

SEC. 1004. BENEFICIARY LIABILITY FOR NONCOVERED SERVICES.

    (a) IN GENERAL- Section 1879 (42 U.S.C. 1395pp) is amended by adding at the end the following new subsection:

    ‘(h) If a supplier of medical equipment and supplies (as defined in section 1834(i)(4))--

      ‘(1) furnishes an item or service to a beneficiary for which no payment may be made by reason of section 1834(i)(1);

      ‘(2) furnishes an item or service to a beneficiary for which payment is denied in advance under section 1834(a)(15); or

      ‘(3) furnishes an item or service to a beneficiary for which payment is denied under section 1862(a)(1);

    any expenses incurred for items and services furnished to an individual by such a supplier on an unassigned basis shall be the responsibility of such supplier. The individual shall have no financial responsibility for such expenses and the supplier shall refund on a timely basis to the individual (and shall be liable to the individual for) any amounts collected from the individual for such items or services. The provisions of section 1834(a)(18) shall apply to refunds required under the previous sentence in the same manner as such provisions apply to refunds under such section.’.

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to items or services furnished on or after October 1, 1993.

SEC. 1005. ADJUSTMENTS FOR INHERENT REASONABLENESS.

    (a) ADJUSTMENTS MADE TO FINAL PAYMENT AMOUNTS-

      (1) IN GENERAL- Section 1834(a)(10)(B) (42 U.S.C. 1395m(a)(10)(B)) is amended by adding at the end the following: ‘In applying such provisions to payments for an item under this subsection, the Secretary shall make adjustments to the payment basis for the item described in paragraph (1)(B) if the Secretary determines (in accordance with such provisions and on the basis of prices and costs applicable at the time the item is furnished) that such payment basis is not inherently reasonable.’.

      (2) EFFECTIVE DATE- The amendment made by paragraph (1) shall take effect on the date of the enactment of this Act.

    (b) ADJUSTMENT REQUIRED FOR CERTAIN ITEMS-

      (1) IN GENERAL- In accordance with section 1834(a)(10)(B) of the Social Security Act (as amended by subsection (a)), the Secretary of Health and Human Services shall determine whether the payment amounts for the items described in paragraph (2) are not inherently reasonable, and shall adjust such amounts in accordance with such section if the amounts are not inherently reasonable.

      (2) ITEMS DESCRIBED- The items referred to in paragraph (1) are decubitus care equipment, transcutaneous electrical nerve stimulators, and any other items considered appropriate by the Secretary.

SEC. 1006. PAYMENT FOR OSTOMY SUPPLIES, TRACHEOSTOMY SUPPLIES, UROLOGICALS, AND SURGICAL DRESSINGS.

    (a) OSTOMY SUPPLIES, TRACHEOSTOMY SUPPLIES, AND UROLOGICALS-

      (1) IN GENERAL- Section 1834(h)(1) (42 U.S.C. 1395m(h)(1)) is amended by adding at the end the following new subparagraph:

        ‘(E) EXCEPTION FOR CERTAIN ITEMS- Payment for ostomy supplies, tracheostomy supplies, and urologicals shall be made in accordance with subparagraphs (B) and (C) of section 1834(a)(2).’.

      (2) CONFORMING AMENDMENT- Section 1834(h)(1)(B) (42 U.S.C. 1395m(h)(1)(B)) is amended by striking ‘subparagraph (C),’ and inserting ‘subparagraphs (C) and (E),’.

      (3) EFFECTIVE DATE- The amendments made by this subsection shall apply to items furnished on or after January 1, 1994.

    (b) SURGICAL DRESSINGS-

      (1) IN GENERAL- Section 1834 (42 U.S.C. 1395m), as amended by section 1001(a), is amended by adding at the end the following new subsection:

    ‘(j) PAYMENT FOR SURGICAL DRESSINGS-

      ‘(1) IN GENERAL- Payment under this subsection for surgical dressings (described in section 1861(s)(5)) shall be made in a lump sum amount for the purchase of the item in an amount equal to 80 percent of the lesser of--

        ‘(A) the actual charge for the item; or

        ‘(B) a payment amount determined in accordance with the methodology described in subparagraphs (B) and (C) of subsection (a)(2) (except that in applying such methodology, the national limited payment amount referred to in such subparagraphs shall be initially computed based on local payment amounts using average reasonable charges for the 12-month period ending December 31, 1992, increased by the covered item updates described in such subsection for 1993 and 1994)

      ‘(2) EXCEPTIONS- Paragraph (1) shall not apply to surgical dressings that are--

        ‘(A) furnished as an incident to a physician’s professional service; or

        ‘(B) furnished by a home health agency.’.

      (2) CONFORMING AMENDMENT- Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)) is amended--

        (A) by striking ‘and’ before ‘(N)’;

        (B) with respect to the matter inserted by section 4155(b)(2)(B) of OBRA-1990--

          (i) by striking ‘(M)’ and inserting ‘, and (O)’, and

          (ii) by transferring and inserting it (as amended) immediately before the semicolon at the end;

        (C) by striking ‘and’ before ‘(O)’; and

        (D) by inserting before the semicolon at the end the following: ‘, and (P) with respect to surgical dressings, the amounts paid shall be the amounts determined under section 1834(j)’.

      (3) EFFECTIVE DATE- The amendments made by this subsection shall apply to items furnished on or after January 1, 1994.

SEC. 1007. PAYMENTS FOR TENS DEVICES.

    (a) IN GENERAL- Section 1834(a)(1)(D) (42 U.S.C. 1395m(a)(1)(D)) is amended by striking ‘15 percent’ the second place it appears and inserting ‘45 percent’.

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to items furnished on or after January 1, 1994.

SEC. 1008. MISCELLANEOUS AND TECHNICAL CORRECTIONS.

    (a) UPDATES TO PAYMENT AMOUNTS- Subparagraph (A) of section 1834(a)(14) (42 U.S.C. 1395m(a)(14)) is amended to read as follows:

        ‘(A) for 1991 and 1992, the percentage increase in the consumer price index for all urban consumers (U.S. city average) for the 12-month period ending with June of the previous year reduced by 1 percentage point; and’.

    (b) TREATMENT OF POTENTIALLY OVERUSED ITEMS AND ADVANCED DETERMINATIONS OF COVERAGE- (1) Effective on the date of the enactment of this Act, section 1834(a)(15) (42 U.S.C. 1395m(a)(15)) is amended to read as follows:

      ‘(15) SPECIAL TREATMENT FOR POTENTIALLY OVERUSED ITEMS-

        ‘(A) DEVELOPMENT OF LIST OF ITEMS BY SECRETARY- The Secretary shall develop and periodically update a list of items for which payment may be made under this subsection that are potentially overused, and shall include in such list seat-lift mechanisms, transcutaneous electrical nerve stimulators, motorized scooters, decubitus care mattresses, and any such other item determined by the Secretary to be potentially overused on the basis of any of the following criteria--

          ‘(i) the item is marketed directly to potential patients;

          ‘(ii) the item is marketed with an offer to potential patients to waive the costs of coinsurance associated with the item or is marketed as being available at no cost to policyholders of a medicare supplemental policy (as defined in section 1882(g)(1));

          ‘(iii) the item has been subject to a consistent pattern of overutilization; or

          ‘(iv) a high proportion of claims for payment for such item under this part may not be made because of the application of section 1862(a)(1).

        ‘(B) ITEMS SUBJECT TO SPECIAL CARRIER SCRUTINY- Payment may not be made under this part for any item contained in the list developed by the Secretary under subparagraph (A) unless the carrier has subjected the claim for payment for the item to special scrutiny or has followed the procedures described in paragraph (11)(C) with respect to the item.’.

    (2) Effective January 1, 1994, section 1834(a)(11) (42 U.S.C. 1395m(a)) is amended by adding at the end the following new subparagraph:

        ‘(C) CARRIER DETERMINATIONS FOR CERTAIN ITEMS IN ADVANCE- A carrier shall determine in advance whether payment for an item may not be made under this subsection because of the application of section 1862(a)(1) if--

          ‘(i) the item is a customized item (other than inexpensive items specified by the Secretary); or

          ‘(ii) the item is a specified covered item under subparagraph (B).’.

    (3) Effective for standards applied for contract years beginning after the date of the enactment of this Act, section 1842(c) (42 U.S.C. 1395u(c)) is amended by adding at the end the following new paragraph:

    ‘(4) Each contract under this section which provides for the disbursement of funds, as described in subsection (a)(1)(B), shall require the carrier to meet criteria developed by the Secretary to measure the timeliness of carrier responses to requests for payment of items described in section 1834(a)(11)(C).’.

    (4) Section 1834(h)(3) (42 U.S.C. 1395m(h)(3)) is amended by striking ‘paragraph (10) and paragraph (11)’ and inserting ‘paragraphs (10) and (11)’.

    (c) STUDY OF VARIATIONS IN DURABLE MEDICAL EQUIPMENT SUPPLIER COSTS-

      (1) COLLECTION AND ANALYSIS OF SUPPLIER COST DATA- The Administration of the Health Care Financing Administration shall, in consultation with appropriate organizations, collect data on supplier costs of durable medical equipment for which payment may be made under part B of the medicare program, and shall analyze such data to determine the proportions of such costs attributable to the service and product components of furnishing such equipment and the extent to which such proportions vary by type of equipment and by the geographic region in which the supplier is located.

      (2) DEVELOPMENT OF GEOGRAPHIC ADJUSTMENT INDEX; REPORTS- Not later than January 1, 1995--

        (A) the Administrator shall submit a report to the Committees on Energy and Commerce and Ways and Means of the House of Representatives and the Committee on Finance of the Senate on the data collected and the analysis conducted under paragraph (1), and shall include in such report the Administrator’s recommendations for a geographic cost adjustment index for suppliers of durable medical equipment under the medicare program and an analysis of the impact of such proposed index on payments under the medicare program; and

        (B) the Comptroller General shall submit a report to the Committees on Energy and Commerce and Ways and Means of the House of Representatives and the Committee on Finance of the Senate analyzing on a geographic basis the supplier costs of durable medical equipment under the medicare program.

    (d) OXYGEN RETESTING- Section 1834(a)(5)(E) (42 U.S.C. 1395m(a)(5)(E)) is amended by striking ‘55’ and inserting ‘56’.

    (e) OTHER MISCELLANEOUS AND TECHNICAL AMENDMENTS- (1) Section 4152(a)(3) of OBRA-1990 is amended by striking ‘amendment made by subsection (a)’ and inserting ‘amendments made by this subsection’.

    (2) Section 4152(c)(2) of OBRA-1990 is amended by striking ‘1395m(a)(7)(A)’ and inserting ‘1395m(a)(7)’.

    (3) Section 1834(a)(7)(A)(iii)(II) (42 U.S.C. 1395m(a)(7)(A)(iii)(II)) is amended by striking ‘clause (v)’ and inserting ‘clause (vi)’.

    (4) Section 1834(a)(7)(C)(i) (42 U.S.C. 1395m(a)(7)(C)(i)) is amended by striking ‘or paragraph (3)’.

    (5) Section 1834(a)(3) (42 U.S.C. 1395m(a)(3)) is amended by striking subparagraph (D).

    (6) Section 4153(c)(1) of OBRA-1990 is amended by striking ‘1834(a)’ and inserting ‘1834(h)’.

    (7) Section 4153(d)(2) of OBRA-1990 is amended by striking ‘Reconiliation’ and inserting ‘Reconciliation’.

    (8)(A) Section 1834(a) (42 U.S.C. 1395m(a)) is amended by striking paragraph (6).

    (B) Section 1834(a) (42 U.S.C. 1395m(a)) is amended--

      (i) in subparagraphs (A) and (B) of paragraph (1), by striking ‘(2) through (7)’ each place it appears and inserting ‘(2) through (5) and (7)’;

      (ii) in paragraph (7), by striking ‘(2) through (6)’ and inserting ‘(2) through (5)’;

      (iii) in paragraph (8), by striking ‘paragraphs (6) and (7)’ each place it appears in the matter preceding subparagraph (A) and in subparagraph (C) and inserting ‘paragraph (7)’; and

      (iv) in paragraph (8)(A)(i), by striking ‘described--’ and all that follows and inserting ‘described in paragraph (7) equal to the average of the purchase prices on the claims submitted on an assignment-related basis for the unused item supplied during the 6-month period ending with December 1986.’.

    (9) The amendments made by this subsection shall take effect as if included in the enactment of OBRA-1990.

Subtitle B--Medicare Secondary Payer

SEC. 1101. MEDICARE SECONDARY PAYER.

    (a) SECONDARY PAYER EXEMPTION FOR MEMBERS OF RELIGIOUS ORDERS- Effective as if included in the enactment of OBRA-1989, section 6202(e)(2) of such Act is amended by adding at the end the following: ‘Such amendment also shall apply to items and services furnished before such date with respect to secondary payor cases which the Secretary of Health and Human Services had not identified as of such date.’.

    (b) IMPROVING IDENTIFICATION OF MEDICARE SECONDARY PAYER SITUATIONS-

      (1) SURVEY OF BENEFICIARIES-

        (A) IN GENERAL- Section 1862(b)(5) (42 U.S.C. 1395y(b)(5)) is amended by adding at the end the following new subparagraph:

        ‘(D) OBTAINING INFORMATION FROM BENEFICIARIES- Before an individual applies for benefits under part A or enrolls under part B, the Administrator shall mail the individual a questionnaire to obtain information on whether the individual is covered under a primary plan and the nature of the coverage provided under the plan, including the name, address, and identifying number of the plan.’.

        (B) DISTRIBUTION OF QUESTIONNAIRE BY CONTRACTOR- The Secretary of Health and Human Services shall enter into an agreement with an entity not later than November 1, 1993, to distribute the questionnaire described in section 1862(b)(5)(D) of the Social Security Act (as added by subparagraph (A)).

        (C) NO MEDICARE SECONDARY PAYOR DENIAL BASED ON FAILURE TO COMPLETE QUESTIONNAIRE- Section 1862(b)(2) (42 U.S.C. 1395y(b)(2)) is amended by adding at the end the following new subparagraph:

        ‘(C) TREATMENT OF QUESTIONNAIRES- The Secretary may not fail to make payment under subparagraph (A) solely on the ground that an individual failed to complete a questionnaire concerning the existence of a primary plan.’.

      (2) MANDATORY SCREENING BY PROVIDERS AND SUPPLIERS UNDER PART B-

        (A) IN GENERAL- Section 1862(b) (42 U.S.C. 1395y(b)) is amended by adding at the end the following new paragraph:

      ‘(6) SCREENING REQUIREMENTS FOR PROVIDERS AND SUPPLIERS-

        ‘(A) IN GENERAL- Notwithstanding any other provision of this title, no payment may be made for any item or service furnished under part B unless the entity furnishing such item or service completes (to the best of its knowledge and on the basis of information obtained from the individual to whom the item or service is furnished) the portion of the claim form relating to the availability of other health benefit plans.

        ‘(B) PENALTIES- An entity that knowingly, willfully, and repeatedly fails to complete a claim form in accordance with subparagraph (A) or provides inaccurate information relating to the availability of other health benefit plans on a claim form under such subparagraph shall be subject to a civil money penalty of not to exceed $2,000 for each such incident. The provisions of section 1128A (other than subsections (a) and (b)) shall apply to a civil money penalty under the previous sentence in the same manner as such provisions apply to a penalty or proceeding under section 1128A(a).’.

        (B) EFFECTIVE DATE- The amendment made by subparagraph (A) shall apply with respect to items and services furnished on or after July 1, 1993.

    (c) IMPROVEMENTS IN RECOVERY OF PAYMENTS FROM PRIMARY PAYERS-

      (1) SUBMISSION OF REPORTS ON EFFORTS TO RECOVER ERRONEOUS PAYMENTS-

        (A) FISCAL INTERMEDIARIES UNDER PART A- Section 1816 (42 U.S.C. 1396h) is amended by adding at the end the following new subsection:

    ‘(k) An agreement with an agency or organization under this section shall require that such agency or organization submit an annual report to the Secretary describing the steps taken to recover payments made for items or services for which payment has been or could be made under a primary plan (as defined in section 1862(b)(2)(A)).’.

        (B) CARRIERS UNDER PART B- Section 1842(b)(3) (42 U.S.C. 1395u(b)(3)) is amended--

          (i) by striking ‘and’ at the end of subparagraphs (G) and (H); and

          (ii) by inserting after subparagraph (H) the following new subparagraph:

      ‘(I) will submit annual reports to the Secretary describing the steps taken to recover payments made under this part for items or services for which payment has been or could be made under a primary plan (as defined in section 1862(b)(2)(A)).’.

      (2) REQUIREMENTS UNDER CARRIER PERFORMANCE EVALUATION PROGRAM-

        (A) FISCAL INTERMEDIARIES UNDER PART A- Section 1816(f)(1)(A) (42 U.S.C. 1396h(f)(1)(A)) is amended by striking ‘processing’ and inserting ‘processing (including the agency’s or organization’s success in recovering payments made under this title for services for which payment has been or could be made under a primary plan (as defined in section 1862(b)(2)(A)))’.

        (B) CARRIERS UNDER PART B- Section 1842(b)(2) (42 U.S.C. 1395u(b)(2)) is amended by adding at the end the following new subparagraph:

    ‘(D) In addition to any other standards and criteria established by the Secretary for evaluating carrier performance under this paragraph relating to avoiding erroneous payments, the Secretary shall establish standards and criteria relating to the carrier’s success in recovering payments made under this part for items or services for which payment has been or could be made under a primary plan (as defined in section 1862(b)(2)(A)).’.

      (3) DEADLINE FOR REIMBURSEMENT BY PRIMARY PLANS-

        (A) IN GENERAL- Section 1862(b)(2)(B)(i) (42 U.S.C. 1395y(b)(2)(B)(i)) is amended by adding at the end the following sentence: ‘If reimbursement is not made to the appropriate Trust Fund before the expiration of the 60-day period that begins on the date such notice or other information is received, the Secretary may charge interest (beginning with the date on which the notice or other information is received) on the amount of the reimbursement until reimbursement is made (at a rate determined by the Secretary in accordance with regulations of the Secretary of the Treasury applicable to charges for late payments).’.

        (B) CONFORMING AMENDMENT- The heading of clause (i) of section 1862(b)(2)(B) is amended to read as follows: ‘REPAYMENT REQUIRED- ’.

        (C) EFFECTIVE DATE- The amendments made by this paragraph shall apply to payments for items and services furnished on or after the date of the enactment of this Act.

      (4) EFFECTIVE DATE- The amendments made by paragraphs (1) and (2) shall apply to contracts with fiscal intermediaries and carriers under title XVIII of the Social Security Act for years beginning with 1993.

    (d) MISCELLANEOUS AND TECHNICAL CORRECTIONS-

      (1) The sentence in section 1862(b)(1)(C) added by section 4203(c)(1)(B) of OBRA-1990 is amended--

        (A) by striking ‘on or before January 1, 1996,’ and inserting ‘before January 1, 1996’; and

        (B) by striking ‘clauses (i) and (ii)’ and inserting ‘this subparagraph’.

      (2) Effective as if included in the enactment of OBRA-1989, section 1862(b)(1) is amended--

        (A) in subparagraphs (A)(v) and (B)(iv)(II), by inserting ‘, without regard to section 5000(d) of such Code’ before the period at the end of each subparagraph;

        (B) in subparagraph (A)(iii), by striking ‘current calendar year or the preceding calendar year’ and inserting ‘current calendar year and the preceding calendar year’; and

        (C) in the matter in subparagraph (C) after clause (ii), by striking ‘taking into account that’ and inserting ‘paying benefits secondary to this title when’.

      (3) Section 4203(c)(2) of OBRA-1990 is amended--

        (A) by striking ‘the application of clause (iii)’ and inserting ‘the second sentence’;

        (B) by striking ‘on individuals’ and all that follows through ‘section 226A of such Act’;

        (C) in clause (ii), by striking ‘clause’ and inserting ‘sentence’;

        (D) in clause (v), by adding ‘and’ at the end; and

        (E) in clause (vi)--

          (i) by inserting ‘of such Act’ after ‘1862(b)(1)(C)’, and

          (ii) by striking the period at the end and inserting the following: ‘, without regard to the number of employees covered by such plans.’.

      (4) Section 4203(d) of OBRA-1990 is amended by striking ‘this subsection’ and inserting ‘this section’.

      (5) Except as provided in paragraph (2), the amendments made by this subsection shall be effective as if included in the enactment of OBRA-1990.

TITLE II--CUSTOMS OFFICER PAY REFORM

SEC. 2001. OVERTIME AND PREMIUM PAY FOR CUSTOMS OFFICERS.

    (a) IN GENERAL- Section 5 of the Act of February 13, 1911 (19 U.S.C. 261 and 267) is amended to read as follows:

‘SEC. 5. OVERTIME AND PREMIUM PAY FOR CUSTOMS OFFICERS.

    ‘(a) OVERTIME PAY-

      ‘(1) IN GENERAL- Subject to paragraph (2) and subsection (c), a customs officer who is officially assigned to perform work in excess of 40 hours in the administrative workweek of the officer or in excess of 8 hours in a day shall be compensated for that work at an hourly rate of pay that is equal to 2 times the hourly rate of the basic pay of the officer. For purposes of this paragraph, the hourly rate of basic pay for a customs officer does not include any premium pay provided for under subsection (b).

      ‘(2) SPECIAL PROVISIONS RELATING TO OVERTIME WORK ON CALLBACK BASIS-

        ‘(A) MINIMUM DURATION- Any work for which compensation is authorized under paragraph (1) and for which the customs officer is required to return to the officer’s place of work shall be treated as being not less than 2 hours in duration; but only if such work begins at least 1 hour after the end of any previous regularly scheduled work assignment and ends at least 1 hour before the beginning of the following regularly scheduled work assignment.

        ‘(B) COMPENSATION FOR COMMUTING TIME-

          ‘(i) IN GENERAL- Except as provided in clause (ii), in addition to the compensation authorized under paragraph (1) for work to which subparagraph (A) applies, the customs officer is entitled to be paid, as compensation for commuting time, an amount equal to 3 times the hourly rate of basic pay of the officer.

          ‘(ii) EXCEPTION- Compensation for commuting time is not payable under clause (i) if the work for which compensation is authorized under paragraph (1)--

            ‘(I) does not commence within 16 hours of the customs officer’s last regularly scheduled work assignment, or

            ‘(II) commences within 2 hours of the next regularly scheduled work assignment of the customs officer.

    ‘(b) PREMIUM PAY FOR CUSTOMS OFFICERS-

      ‘(1) NIGHT WORK DIFFERENTIAL-

        ‘(A) 3 P.M. TO MIDNIGHT SHIFTWORK- If the majority of the hours of regularly scheduled work of a customs officer occur during the period beginning at 3 p.m. and ending at 12 a.m., the officer is entitled to pay for work during such period (except for work to which paragraph (2) or (3) applies) at the officer’s hourly rate of basic pay plus premium pay amounting to 15 percent of that basic rate.

        ‘(B) 11 P.M. TO 8 A.M. SHIFTWORK- If the majority of the hours of regularly scheduled work of a customs officer occur during the period beginning at 11 p.m. and ending at 8 a.m., the officer is entitled to pay for work during such period (except for work to which paragraph (2) or (3) applies) at the officer’s hourly rate of basic pay plus premium pay amounting to 20 percent of that basic rate.

        ‘(C) 7:30 P.M. TO 3:30 A.M. SHIFTWORK- If the regularly scheduled work assignment of a customs officer is 7:30 p.m. to 3:30 a.m., the officer is entitled to pay for work during such period (except for work to which paragraph (2) or (3) applies) at the officer’s hourly rate of basic pay plus premium pay amounting to 15 percent of that basic rate for the period from 7:30 p.m. to 11:30 p.m. and at the officer’s hourly rate of basic pay plus premium pay amounting to 20 percent of that basic rate for the period from 11:30 p.m. to 3:30 a.m.

      ‘(2) SUNDAY DIFFERENTIAL- A customs officer who performs any regularly scheduled work on a Sunday that is not a holiday is entitled to pay for that work at the officer’s hourly rate of basic pay plus premium pay amounting to 50 percent of that basic rate.

      ‘(3) HOLIDAY DIFFERENTIAL- A customs officer who performs any regularly scheduled work on a holiday is entitled to pay for that work at the officer’s hourly rate of basic pay plus premium pay amounting to 100 percent of that basic rate.

      ‘(4) TREATMENT OF PREMIUM PAY- Premium pay provided for under this subsection may not be treated as being overtime pay or compensation for any purpose.

    ‘(c) LIMITATIONS-

      ‘(1) FISCAL YEAR CAP- The aggregate of overtime pay under subsection (a) (including commuting compensation under subsection (a)(2)(B)) and premium pay under subsection (b) that a customs officer may be paid in any fiscal year may not exceed $25,000; except that the Commissioner of Customs or his designee may waive this limitation in individual cases in order to prevent excessive costs or to meet emergency requirements of the Customs Service.

      ‘(2) EXCLUSIVITY OF PAY UNDER THIS SECTION- A customs officer who receives overtime pay under subsection (a) or premium pay under subsection (b) for time worked may not receive pay or other compensation for that work under any other provision of law.

    ‘(d) REGULATIONS- The Secretary of the Treasury shall prescribe such regulations as are necessary or appropriate to carry out this section, including regulations--

      ‘(1) to ensure that callback work assignments are commensurate with the overtime pay authorized for such work; and

      ‘(2) to prevent the disproportionate assignment of overtime work to customs officers who are near to retirement.

    ‘(e) DEFINITIONS- As used in this section:

      ‘(1) The term ‘customs officer’ means an individual performing those functions specified by regulation by the Secretary of the Treasury for a customs inspector or canine enforcement officer. Such functions shall be consistent with such applicable standards as may be promulgated by the Office of Personnel Management.

      ‘(2) The term ‘holiday’ means any day designated as a holiday under a Federal statute or Executive order.’.

    (b) CONFORMING AMENDMENTS-

      (1) Section 2 of the Act of June 3, 1944 (19 U.S.C. 1451a), is repealed.

      (2) Section 450 of the Tariff Act of 1930 (19 U.S.C. 1450) is amended--

        (A) by striking out ‘at night’ in the section heading and inserting ‘during overtime hours’;

        (B) by striking out ‘at night’ and inserting ‘during overtime hours’; and

        (C) by inserting ‘aircraft,’ immediately before ‘vessel’.

    (c) EFFECTIVE DATE- The amendments made by subsections (a) and (b) apply to customs inspectional services provided on or after October 1, 1993.

SEC. 2002. FOREIGN LANGUAGE PROFICIENCY AWARDS FOR CUSTOMS OFFICERS.

    Cash awards for foreign language proficiency may, under regulations prescribed by the Secretary of the Treasury, be paid to customs officers (as referred to in section 5(e)(1) of the Act of February 13, 1911) to the same extent and in the same manner as would be allowable under subchapter III of chapter 45 of title 5, United States Code, with respect to law enforcement officers (as defined by section 4521 of such title).

SEC. 2003. APPROPRIATIONS REIMBURSEMENTS FROM THE CUSTOMS USER FEE ACCOUNT.

    Section 13031(f)(3) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(f)(3)) is amended--

      (1) by amending clause (i) of subparagraph (A) to read as follows: ‘(i) in--

        ‘(I) paying overtime compensation and premium pay under section 5 (a) and (b) of the Act of February 13, 1911,

        ‘(II) paying agency contributions to the Civil Service Retirement and Disability Fund to match deductions from the overtime compensation paid under subclause (I), and

        ‘(III) providing all preclearance services for which the recipients of such services are not required to reimburse the Secretary of the Treasury, and’; and

      (2) by striking out ‘except for costs described in subparagraph (A)(i) (I) and (II),’ in subparagraph (B)(i).

SEC. 2004. TREATMENT OF CERTAIN PAY OF CUSTOMS OFFICERS FOR RETIREMENT PURPOSES.

    (a) IN GENERAL- Section 8331(3) of title 5, United States Code, is amended--

      (1) by striking out ‘and’ at the end of subparagraph (C);

      (2) by striking out the semicolon at the end of subparagraph (D) and inserting ‘; and’;

      (3) by adding after subparagraph (D) the following:

        ‘(E) with respect to a customs officer (referred to in subsection (e)(1) of section 5 of the Act of February 13, 1911), compensation for overtime inspectional services provided for under subsection (a) of such section 5, but not to exceed 50 percent of any statutory maximum in overtime pay for customs officers which is in effect for the year involved;’; and

      (4) by striking out ‘subparagraphs (B), (C), and (D) of this paragraph,’ and inserting ‘subparagraphs (B), (C), (D), and (E) of this paragraph’.

    (b) EFFECTIVE DATE- The amendments made by subsection (a) take effect on the date of the enactment of this Act and apply only with respect to service performed on or after such date.

SEC. 2005. REPORTS.

    (a) CUSTOMS USER FEE ACCOUNT REPORTS- Subparagraph (D) of section 13031(f)(3) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(f)(3)(D)) is amended to read as follows:

        ‘(D) At the close of each fiscal year, the Secretary of the Treasury shall submit a report to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives--

          ‘(i) containing a detailed accounting of all expenditures from the Customs User Fee Account during such year, including a summary of the expenditures, on a port-by-port basis, for which reimbursement has been provided under subparagraph (A)(ii);

          ‘(ii) containing a listing of all callback assignments of customs officers for which overtime compensation was paid under section 5(a) of the Act of February 13, 1911, and that were less than 1 hour in duration; and

          ‘(iii) containing a listing of all customs officers who were paid $25,000 or more under subsections 5(a) and 5(b) of the Act of February 13, 1911, including a listing of the total compensation paid to each of those customs officers under all other statutory authority.’.

    (b) OTHER REPORTS-

      (1) GAO REPORT- The Comptroller General of the United States shall undertake--

        (A) an evaluation of the appropriateness and efficiency of the customs user fee laws for financing the provision of customs inspectional services; and

        (B) a study to determine whether cost savings in the provision of overtime inspectional services could be realized by the United States Customs Service through the use of additional inspectors as opposed to continuing the current practice of relying on overtime pay.

      The Comptroller General shall submit a report on the evaluation and study required under this subsection to the Committees by no later than the 1st anniversary of the date of the enactment of this Act.

      (2) TREASURY RECOMMENDATION- On the day that the President submits the budget for the United States Government for fiscal year 1995 to the Congress under section 1105(a) of title 31, United States Code, the Secretary of the Treasury shall submit to the Committees recommended legislative proposals for improving the operation of customs user fee laws in financing the provision of customs inspectional services.

      (3) DEFINITION OF COMMITTEES- For purposes of this subsection, the term ‘Committees’ means the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate.

TITLE III--AVAILABILITY AND USE OF DEATH INFORMATION UNDER THE OLD-AGE, SURVIVORS, AND DISABILITY INSURANCE PROGRAM

SEC. 3001. AVAILABILITY AND USE OF DEATH INFORMATION UNDER THE OLD-AGE, SURVIVORS, AND DISABILITY INSURANCE PROGRAM.

    (a) IMPROVEMENTS IN PROGRAM FOR USE OF DEATH CERTIFICATES TO CORRECT PROGRAM INFORMATION-

      (1) ELIMINATION OF STATE RESTRICTIONS ON USE OF INFORMATION- Section 205(r)(1) of the Social Security Act (42 U.S.C. 405(r)(1)) is amended by adding at the end, after and below subparagraph (B), the following new sentence:

    ‘Any contract entered into pursuant to subparagraph (A) shall not include any restriction on the use of information obtained by the Secretary pursuant to such contract, except to the extent that such use may be restricted under paragraph (6).’.

      (2) INFORMATION PROVIDED TO STATE AGENCIES FREE OF CHARGE-

        (A) IN GENERAL- Section 205(r)(4) of such Act (42 U.S.C. 405(r)(4)) is amended to read as follows:

    ‘(4)(A) In the case of individuals with respect to whom federally funded benefits are provided by (or through) a State agency other than under this Act, the Secretary shall to the extent feasible provide such information free of charge through a cooperative arrangement with such agency, for ensuring proper payment of those benefits with respect to such individuals, if such arrangement does not conflict with the duties of the Secretary under paragraph (1).

    ‘(B) The Secretary may enter into similar agreements with States to provide information free of charge for their use in programs wholly funded by the States if such arrangement does not conflict with the duties of the Secretary under paragraph (1).’.

        (B) CONFORMING AMENDMENT- Section 205(r)(3) of such Act (42 U.S.C. 405(r)(3)) is amended by striking ‘or State’.

      (3) USE BY STATES OF SOCIAL SECURITY ACCOUNT NUMBERS CONTINGENT UPON PARTICIPATION IN PROGRAM- Section 205(r)(2) of such Act (42 U.S.C. 405(r)(2)) is amended--

        (A) by inserting ‘(A)’ after ‘(2)’; and

        (B) by adding at the end the following new subparagraph:

    ‘(B) Notwithstanding section 7(a)(2)(B) of the Privacy Act of 1974 and clauses (i) and (v) of subsection (c)(2)(C) of this section, any State which is not a party to a contract with the Secretary meeting the requirements of paragraph (1) (and any political subdivision thereof) may not utilize an individual’s social security account number in the administration of any driver’s license or motor vehicle registration law.’.

    (b) STUDY REGARDING IMPROVEMENTS IN GATHERING AND REPORTING OF DEATH INFORMATION.

      (1) IN GENERAL- As soon as practicable after the date of the enactment of this Act, the Secretary of Health and Human Services shall conduct a study of possible improvements in the current methods of gathering and reporting death information by the Federal, State, and local governments which would result in more efficient and expeditious handling of such information.

      (2) SPECIFIC MATTERS TO BE STUDIED- In carrying out the study required under this subsection, the Secretary shall--

        (A) ascertain the delays in the receipt of death information which are currently encountered by the Social Security Administration and other agencies in need of such information on a regular basis,

        (B) analyze the causes of such delays,

        (C) develop alternative options for improving Federal, State, and local agency cooperation in reducing such delays, and

        (D) evaluate the costs and benefits associated with the options referred to in subparagraph (C).

      (3) REPORT- Not later than June 1, 1994, the Secretary shall submit a written report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate setting forth the results of the study conducted pursuant to this subsection, together with such administrative and legislative recommendations as the Secretary may consider appropriate.

    (c) EFFECTIVE DATE-

      (1) IN GENERAL- The amendments made by subsection (a) shall take effect 1 year after the date of the enactment of this Act.

      (2) PROMOTION OF ENTRY INTO NEW CONTRACTS- As soon as practicable after the date of the enactment of this Act, the Secretary of Health and Human Services shall take such actions as are necessary and appropriate to promote entry into contracts under section 205(r) of the Social Security Act which are in compliance with the requirements of the amendments made by subsection (a).

TITLE IV--PBGC REPORT ON EMPLOYERS WITH UNDERFUNDED PLANS

SEC. 4001. REPORT ON EMPLOYERS WITH UNDERFUNDED PLANS.

    (a) GENERAL RULE- The Pension Benefit Guaranty Corporation shall, on January 31 of each calendar year after 1993, submit a report to the Congress setting forth--

      (1) the name of each contributing sponsor of 1 or more applicable plans having unfunded liabilities aggregating $25,000,000 or more, and

      (2) the name of each contributing sponsor with an applicable plan which has an unfunded liability in excess of $5,000,000 and with respect to which a minimum funding waiver in excess of $1,000,000 has been granted.

    Information may be included in such report only if such information may be publicly disclosed by the Pension Benefit Guaranty Corporation.

    (b) DETERMINATIONS OF UNFUNDED LIABILITY- For purposes of subsection (a), determinations of the unfunded liability of any plan shall be made by the Pension Benefit Guaranty Corporation on the basis of the most recent information available to it.

    (c) APPLICABLE PLAN- For purposes of subsection (a), the term ‘applicable plan’ means any employee pension benefit plan (as defined in paragraph (2) of section 3 of the Employee Retirement Income Security Act of 1974) covered under subtitle B of title IV of such Act; except that such term shall not include a multiemployer plan (as defined in section 4001(a)(3) of such Act).

    (d) CONTRIBUTING SPONSOR- For purposes of this section, the term ‘contributing sponsor’ has the meaning given to such term by section 4001(a)(13) of such Act.

TITLE V--TAXPAYER BILL OF RIGHTS 2

SEC. 5000. SHORT TITLE; AMENDMENT OF 1986 CODE.

    (a) SHORT TITLE- This title may be cited as the ‘Taxpayer Bill of Rights 2’.

    (b) AMENDMENT OF 1986 CODE- Except as otherwise expressly provided, whenever in this title or title VI an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.

Subtitle A--Taxpayer Advocate

SEC. 5001. ESTABLISHMENT OF POSITION OF TAXPAYER ADVOCATE WITHIN INTERNAL REVENUE SERVICE.

    (a) GENERAL RULE- Section 7802 (relating to Commissioner of Internal Revenue; Assistant Commissioner (Employee Plans and Exempt Organizations)) is amended by adding at the end thereof the following new subsection:

    ‘(d) OFFICE OF TAXPAYER ADVOCATE-

      ‘(1) IN GENERAL- There is established in the Internal Revenue Service an office to be known as the ‘Office of the Taxpayer Advocate’. Such office, including all problem resolution officers, shall be under the supervision and direction of an official to be known as the ‘Taxpayer Advocate’ who shall be appointed by the President by and with the advice and consent of the Senate, and who shall report directly to the Commissioner of Internal Revenue. The Taxpayer Advocate shall be entitled to compensation at the same rate as the Chief Counsel for the Internal Revenue Service.

      ‘(2) FUNCTIONS OF OFFICE-

        ‘(A) IN GENERAL- It shall be the function of the Office of Taxpayer Advocate to--

          ‘(i) assist taxpayers in resolving problems with the Internal Revenue Service,

          ‘(ii) identify areas in which taxpayers have problems in dealings with the Internal Revenue Service,

          ‘(iii) to the extent possible, propose changes in the administrative practices of the Internal Revenue Service to mitigate problems identified under clause (ii), and

          ‘(iv) identify potential legislative changes which may be appropriate to mitigate such problems.

        ‘(B) ANNUAL REPORTS-

          ‘(i) OBJECTIVES- Not later than October 31 of each calendar year after 1993, the Taxpayer Advocate shall report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate on the objectives of the Taxpayer Advocate for the following calendar year. Any such report shall contain full and substantive analysis, in addition to statistical information.

          ‘(ii) ACTIVITIES- Not later than June 30 of each calendar year after 1993, the Taxpayer Advocate shall report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate on the activities of the Taxpayer Advocate during the fiscal year ending during such calendar year. Any such report shall contain full and substantive analysis, in addition to statistical information, and shall--

            ‘(I) identify the initiatives the Taxpayer Advocate has taken on improving taxpayer services and Internal Revenue Service responsiveness,

            ‘(II) contain recommendations received from individuals with the authority to issue taxpayer assistance orders under section 7811,

            ‘(III) contain a summary of at least 20 of the most serious problems encountered by taxpayers, including a description of the nature of such problems,

            ‘(IV) contain an inventory of the items described in subclauses (I), (II), and (III) for which action has been taken and the result of such action,

            ‘(V) contain an inventory of the items described in subclauses (I), (II), and (III) for which action remains to be completed and the period during which each item has remained on such inventory,

            ‘(VI) contain an inventory of the items described in subclauses (II) and (III) for which no action has been taken, the period during which each item has remained on such inventory, the reasons for the inaction, and identify any Internal Revenue Service official who is responsible for such inaction,

            ‘(VII) identify any Taxpayer Assistance Order which was not honored by the Internal Revenue Service in a timely manner, as specified under section 7811(b),

            ‘(VIII) contain recommendations for such administrative and legislative action as may be appropriate to resolve problems encountered by taxpayers, and

            ‘(IX) include such other information as the Taxpayer Advocate may deem advisable.

          ‘(iii) REPORT TO BE SUBMITTED DIRECTLY- Each report required under this subparagraph shall be provided directly to the Committees referred to in clauses (i) and (ii) without any prior review or comment from the Commissioner of the Internal Revenue Service, the Secretary of the Treasury, any other officer or employee of the Department of the Treasury, or the Office of Management and Budget.

      ‘(3) RESPONSIBILITIES OF COMMISSIONER OF INTERNAL REVENUE SERVICE- The Commissioner of Internal Revenue shall establish procedures requiring a formal response to all recommendations submitted to the Commissioner by the Taxpayer Advocate.’

    (b) CONFORMING AMENDMENTS-

      (1) Section 7811 (relating to taxpayer assistance orders) is amended--

        (A) by striking ‘the Office of Ombudsman’ in subsection (a) and inserting ‘the Office of the Taxpayer Advocate’, and

        (B) by striking ‘Ombudsman’ each place it appears (including in the headings of subsections (e) and (f)) and inserting ‘Taxpayer Advocate’.

      (2) The heading for section 7802 is amended to read as follows:

‘SEC. 7802. COMMISSIONER OF INTERNAL REVENUE; ASSISTANT COMMISSIONERS; TAXPAYER ADVOCATE.’

      (3) The table of sections for subchapter A of chapter 80 of subtitle F is amended by striking the item relating to section 7802 and inserting the following new item:

‘Sec. 7802. Commissioner of Internal Revenue; Assistant Commissioners; Taxpayer Advocate.’

    (c) EFFECTIVE DATE- The amendments made by this section shall take effect on the date of the enactment of this Act.

SEC. 5002. EXPANSION OF AUTHORITY TO ISSUE TAXPAYER ASSISTANCE ORDERS.

    (a) TERMS OF ORDERS- Subsection (b) of section 7811 (relating to terms of taxpayer assistance orders) is amended--

      (1) by inserting ‘within a specified time period’ after ‘the Secretary’, and

      (2) by inserting ‘take any action as permitted by law,’ after ‘cease any action,’.

    (b) LIMITATION ON AUTHORITY TO MODIFY OR RESCIND- Section 7811(c) (relating to authority to modify or rescind) is amended to read as follows:

    ‘(c) AUTHORITY TO MODIFY OR RESCIND- Any Taxpayer Assistance Order issued by the Taxpayer Advocate under this section may be modified or rescinded only by the Taxpayer Advocate, the Commissioner, or any superior of either.’

    (c) EFFECTIVE DATE- The amendments made by this section shall take effect on the date of the enactment of this Act.

Subtitle B--Modifications to Installment Agreement Provisions

SEC. 5101. NOTIFICATION OF REASONS FOR TERMINATION OR DENIAL OF INSTALLMENT AGREEMENTS.

    (a) TERMINATIONS- Subsection (b) of section 6159 (relating to extent to which agreements remain in effect) is amended by adding at the end thereof the following new paragraph:

      ‘(5) NOTICE REQUIREMENTS- The Secretary may not take any action under paragraph (2), (3), or (4) unless--

        ‘(A) a notice of such action is provided to the taxpayer not later than the day 30 days before the date of such action, and

        ‘(B) such notice includes an explanation why the Secretary intends to take such action.

      The preceding sentence shall not apply in any case in which the Secretary believes that collection of any tax to which an agreement under this section relates is in jeopardy.’

    (b) DENIALS- Section 6159 (relating to agreements for payment of tax liability in installments) is amended by adding at the end thereof the following new subsection:

    ‘(c) NOTICE REQUIREMENTS FOR DENIALS- The Secretary may not deny any request for an installment agreement under this section unless--

      ‘(1) a notice of the proposed denial is provided to the taxpayer not later than the day 30 days before the date of such denial, and

      ‘(2) such notice includes an explanation why the Secretary intends to deny such request.

    The preceding sentence shall not apply in any case in which the Secretary believes that collection of any tax to which a request for an agreement under this section relates is in jeopardy.’

    (c) CONFORMING AMENDMENT- Paragraph (3) of section 6159(b) is amended to read as follows:

      ‘(3) SUBSEQUENT CHANGE IN FINANCIAL CONDITIONS- If the Secretary makes a determination that the financial condition of a taxpayer with whom the Secretary has entered into an agreement under subsection (a) has significantly changed, the Secretary may alter, modify, or terminate such agreement.’

    (d) EFFECTIVE DATE- The amendments made by this section shall take effect on the date 6 months after the date of the enactment of this Act.

SEC. 5102. ADMINISTRATIVE REVIEW OF DENIAL OF REQUEST FOR, OR TERMINATION OF, INSTALLMENT AGREEMENT.

    (a) GENERAL RULE- Section 6159 (relating to agreements for payment of tax liability in installments), as amended by section 1101, is amended by adding at the end thereof the following new subsection:

    ‘(d) ADMINISTRATIVE REVIEW- The Secretary shall establish procedures for an independent administrative review of denials of requests for, or terminations of, installment agreements under this section.’

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall take effect on January 1, 1994.

Subtitle C--Interest

SEC. 5201. EXPANSION OF AUTHORITY TO ABATE INTEREST.

    (a) GENERAL RULE- Paragraph (1) of section 6404(e) (relating to abatement of interest in certain cases) is amended--

      (1) by inserting ‘unreasonable’ before ‘error’ each place it appears in subparagraphs (A) and (B), and

      (2) by striking ‘ministerial act’ each place it appears and inserting ‘ministerial or managerial act’.

    (b) CLERICAL AMENDMENT- The subsection heading for subsection (e) of section 6404 is amended by striking ‘Assessments’ and inserting ‘Abatement’.

    (c) EFFECTIVE DATE- The amendments made by this section shall apply to interest accruing with respect to deficiencies or payments for taxable years beginning after the date of the enactment of this Act.

SEC. 5202. EXTENSION OF INTEREST-FREE PERIOD FOR PAYMENT OF TAX AFTER NOTICE AND DEMAND.

    (a) GENERAL RULE- Paragraph (3) of section 6601(e) (relating to payments made within 10 days after notice and demand) is amended to read as follows:

      ‘(3) PAYMENTS MADE WITHIN SPECIFIED PERIOD AFTER NOTICE AND DEMAND- If notice and demand is made for payment of any amount and if such amount is paid within 21 days (10 days if the amount for which such notice and demand is made equals or exceeds $100,000) after the date of such notice and demand, interest under this section on the amount so paid shall not be imposed for the period after the date of such notice and demand.’

    (b) CONFORMING AMENDMENT- Paragraph (3) of section 6651(a) (relating to addition to tax for failure to file tax return or pay tax) is amended by striking ‘10 days’ and inserting ‘21 days (10 days if the amount for which such notice and demand is made equals or exceed $100,000)’.

    (c) EFFECTIVE DATE- The amendments made by this section shall apply in the case of any notice and demand given after June 30, 1994.

Subtitle D--Joint Returns

SEC. 5301. DISCLOSURE OF COLLECTION ACTIVITIES.

    (a) GENERAL RULE- Subsection (e) of section 6103 (relating to disclosure to persons having material interest) is amended by adding at the end thereof the following new paragraph:

      ‘(8) DISCLOSURE OF COLLECTION ACTIVITIES WITH RESPECT TO JOINT RETURN- If any deficiency of tax with respect to a joint return is assessed and the individuals filing such return are no longer married or no longer reside in the same household, upon request in writing of either of such individuals, the Secretary may disclose in writing to the individual making the request whether the Secretary has attempted to collect such deficiency from such other individual, the general nature of such collection activities, and the amount collected.’

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall take effect on the date of the enactment of this Act.

SEC. 5302. JOINT RETURN MAY BE MADE AFTER SEPARATE RETURNS WITHOUT FULL PAYMENT OF TAX.

    (a) GENERAL RULE- Paragraph (2) of section 6013(b) (relating to limitations on filing of joint return after filing separate returns) is amended by striking subparagraph (A) and redesignating the following subparagraphs accordingly.

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to taxable years beginning after the date of the enactment of this Act.

Subtitle E--Collection Activities

SEC. 5401. MODIFICATIONS TO LIEN AND LEVY PROVISIONS.

    (a) WITHDRAWAL OF CERTAIN NOTICES- Section 6323 (relating to validity and priority against certain persons) is amended by adding at the end thereof the following new subsection:

    ‘(j) WITHDRAWAL OF NOTICE IN CERTAIN CIRCUMSTANCES-

      ‘(1) IN GENERAL- The Secretary may withdraw a notice of a lien filed under this section and this chapter shall be applied as if the withdrawn notice had not been filed, if the Secretary determines that--

        ‘(A) the filing of such notice was premature or otherwise not in accordance with administrative procedures of the Secretary,

        ‘(B) the taxpayer has entered into an agreement under section 6159 to satisfy the tax liability for which the lien was imposed by means of installment payments, unless such agreement provides otherwise,

        ‘(C) the withdrawal of such notice will facilitate the collection of the tax liability, or

        ‘(D) with the consent of the taxpayer or the Taxpayer Advocate, the withdrawal of such notice would be in the best interests of the taxpayer (as determined by the Taxpayer Advocate) and the United States.

      Any such withdrawal shall be made by filing notice thereof at the same office as the withdrawn notice. A copy of such notice of withdrawal shall be provided to the taxpayer.

      ‘(2) NOTICE TO CREDIT AGENCIES, ETC- Upon written request by the taxpayer with respect to whom a notice of a lien was withdrawn under paragraph (1), the Secretary shall promptly make reasonable efforts to notify credit reporting agencies, and any financial institution or creditor whose name and address is specified in such request, of the withdrawal of such notice. Any such request shall be in such form as the Secretary may prescribe.’

    (b) RETURN OF LEVIED PROPERTY IN CERTAIN CASES- Section 6343 (relating to authority to release levy and return property) is amended by adding at the end thereof the following new subsection:

    ‘(d) RETURN OF PROPERTY IN CERTAIN CASES- If--

      ‘(1) any property has been levied upon, and

      ‘(2) the Secretary determines that--

        ‘(A) the levy on such property was premature or otherwise not in accordance with administrative procedures of the Secretary,

        ‘(B) the taxpayer has entered into an agreement under section 6159 to satisfy the tax liability for which the levy was imposed by means of installment payments, unless such agreement provides otherwise,

        ‘(C) the return of such property will facilitate the collection of the tax liability, or

        ‘(D) with the consent of the taxpayer or the Taxpayer Advocate, the return of such property would be in the best interests of the taxpayer (as determined by the Taxpayer Advocate) and the United States,

    the provisions of subsection (b) shall apply in the same manner as if such property had been wrongly levied upon, except that no interest shall be allowed under subsection (c).’

    (c) MODIFICATIONS IN CERTAIN LEVY EXEMPTION AMOUNTS-

      (1) FUEL, ETC- Paragraph (2) of section 6334(a) (relating to fuel, provisions, furniture, and personal effects exempt from levy) is amended--

        (A) by striking ‘If the taxpayer is the head of a family, so’ and inserting ‘So’, and

        (B) by striking ‘$1,650 ($1,550 in the case of levies issued during 1989)’ and inserting ‘$1,700’.

      (2) BOOKS, ETC- Paragraph (3) of section 6334(a) (relating to books and tools of a trade, business, or profession exempt from levy) is amended by striking ‘$1,100 ($1,050 in the case of levies issued during 1989)’ and inserting ‘$1,200’.

      (3) INDEXED FOR INFLATION- Section 6334 (relating to property exempt from levy) is amended by adding at the end thereof the following new subsection:

    ‘(f) INFLATION ADJUSTMENTS-

      ‘(1) IN GENERAL- In the case of any calendar year beginning after 1994, each dollar amount referred to in paragraphs (2) and (3) of subsection (a) shall be increased by an amount equal to--

        ‘(A) such dollar amount, multiplied by

        ‘(B) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year, by substituting ‘calendar year 1993’ for ‘calendar year 1989’ in subparagraph (B) thereof.

      ‘(2) ROUNDING- If any dollar amount after being increased under paragraph (1) is not a multiple of $10, such dollar amount shall be rounded to the nearest multiple of $10 (or, if such dollar amount is a multiple of $5, such dollar amount shall be increased to the next higher multiple of $10).’

    (d) EFFECTIVE DATES-

      (1) IN GENERAL- Except as provided in paragraph (2), the amendments made by this section shall take effect on the date of the enactment of this Act.

      (2) EXEMPT AMOUNTS- The amendments made by subsection (c) shall take effect with respect to levies issued after December 31, 1993.

SEC. 5402. OFFERS-IN-COMPROMISE.

    (a) GENERAL RULE- Subsection (a) of section 7122 (relating to compromises) is amended by adding at the end thereof the following new sentence: ‘The Secretary may make such a compromise in any case where the Secretary determines that such compromise would be in the best interests of the United States.’.

    (b) REVIEW REQUIREMENTS- Subsection (b) of section 7122 (relating to records) is amended by striking ‘$500.’ and inserting ‘$50,000. However, such compromise shall be subject to continuing quality review by the Secretary.’.

    (c) EFFECTIVE DATE- The amendments made by this section shall take effect on the date of the enactment of this Act.

SEC. 5403. NOTIFICATION OF EXAMINATION.

    (a) IN GENERAL- Section 7605 (relating to restrictions on examination of taxpayer) is amended by redesignating subsection (c) as subsection (d) and by inserting after subsection (b) the following new subsection:

    ‘(c) NOTIFICATION REQUIREMENT- No examination described in subsection (a) shall be made unless the Secretary notifies the taxpayer in writing by mail to an address determined under section 6212(b) that the taxpayer is under examination and provides the taxpayer with an explanation of the process as described in section 7521(b)(1). The preceding sentence shall not apply in the case of any examination if the Secretary determines that--

      ‘(1) such examination is in connection with a criminal investigation or is with respect to a tax the collection of which is in jeopardy, or

      ‘(2) the application of the preceding sentence would be inconsistent with national security needs or would interfere with the effective conduct of a confidential law enforcement or foreign counterintelligence activity.’

    (b) CONFORMING AMENDMENT- Paragraph (1) of section 7521(b) (relating to safeguards) is amended by striking ‘or at’.

    (c) EFFECTIVE DATE- The amendments made by this section shall take effect on the date of the enactment of this Act.

SEC. 5404. INCREASE IN LIMIT ON RECOVERY OF CIVIL DAMAGES FOR UNAUTHORIZED COLLECTION ACTIONS.

    (a) GENERAL RULE- Subsection (b) of section 7433 (relating to damages) is amended by striking ‘$100,000’ and inserting ‘$1,000,000’.

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to actions by officers or employees of the Internal Revenue Service after the date of the enactment of this Act.

SEC. 5405. SAFEGUARDS RELATING TO DESIGNATED SUMMONS.

    (a) STANDARD OF REVIEW- Subparagraph (A) of section 6503(k)(2) (defining designated summons) is amended by redesignating clauses (i) and (ii) as clauses (ii) and (iii), respectively, and by inserting before clause (ii) (as so redesignated) the following new clause:

          ‘(i) the issuance of such summons is preceded by a review of such issuance by the regional counsel of the Office of Chief Counsel for the region in which the examination of the corporation is being conducted,’.

    (b) NOTICE REQUIREMENTS FOR ISSUANCE- Section 6503(k) is amended by adding at the end thereof the following new paragraph:

      ‘(4) NOTICE REQUIREMENTS- With respect to any summons referred to in paragraph (1)(A) issued to any person other than the corporation, the Secretary shall promptly notify the corporation, in writing, that such summons has been issued with respect to such corporation’s return of tax.’

    (c) EFFECTIVE DATE- The amendments made by this section shall apply to summons issued after the date of the enactment of this Act.

Subtitle F--Information Returns

SEC. 5501. PHONE NUMBER OF PERSON PROVIDING PAYEE STATEMENTS REQUIRED TO BE SHOWN ON SUCH STATEMENT.

    (a) GENERAL RULE- The following provisions are each amended by striking ‘name and address’ and inserting ‘name, address, and phone number of the information contact’:

      (1) Section 6041(d)(1).

      (2) Section 6041A(e)(1).

      (3) Section 6042(c)(1).

      (4) Section 6044(e)(1).

      (5) Section 6045(b)(1).

      (6) Section 6049(c)(1)(A).

      (7) Section 6050B(b)(1).

      (8) Section 6050H(d)(1).

      (9) Section 6050I(e)(1).

      (10) Section 6050J(e).

      (11) Section 6050K(b)(1).

      (12) Section 6050N(b)(1).

    (b) EFFECTIVE DATE- The amendments made by subsection (a) shall apply to statements required to be furnished after December 31, 1994 (determined without regard to any extension).

SEC. 5502. CIVIL DAMAGES FOR FRAUDULENT FILING OF INFORMATION RETURNS.

    (a) GENERAL RULE- Subchapter B of chapter 76 (relating to proceedings by taxpayers and third parties) is amended by redesignating section 7434 as section 7435 and by inserting after section 7433 the following new section:

‘SEC. 7434. CIVIL DAMAGES FOR FRAUDULENT FILING OF INFORMATION RETURNS.

    ‘(a) IN GENERAL- If any person willfully files a false or fraudulent information return with respect to payments purported to be made to any other person, such other person may bring a civil action for damages against the person so filing such return.

    ‘(b) DAMAGES- In any action brought under subsection (a), upon a finding of liability on the part of the defendant, the defendant shall be liable to the plaintiff in an amount equal to the greater of $5,000 or the sum of--

      ‘(1) any actual damages sustained by the plaintiff as a proximate result of the filing of the false or fraudulent information return (including any costs attributable to resolving deficiencies asserted as a result of such filing), and

      ‘(2) the costs of the action.

    ‘(c) PERIOD FOR BRINGING ACTION- Notwithstanding any other provision of law, an action to enforce the liability created under this section may be brought without regard to the amount in controversy and may be brought only within the later of--

      ‘(1) 4 years after the date of the filing of the false or fraudulent information return, or

      ‘(2) 1 year after the date such false or fraudulent information return would have been discovered by exercise of reasonable care.

    ‘(d) COPY OF COMPLAINT FILED WITH IRS- Any person bringing an action under subsection (a) shall provide a copy of the complaint to the Internal Revenue Service upon the filing of such complaint with the court.

    ‘(e) FINDING OF COURT TO INCLUDE CORRECT AMOUNT OF PAYMENT- The judgment of the court in an action brought under subsection (a) shall include a finding of the correct amount which should have been reported in the information return.

    ‘(f) INFORMATION RETURN- For purposes of this section, the term ‘information return’ means any statement described in section 6724(d)(1)(A).’

    (b) CLERICAL AMENDMENT- The table of sections for subchapter B of chapter 76 is amended by striking the item relating to section 7434 and inserting the following:

‘Sec. 7434. Civil damages for fraudulent filing of information returns.

‘Sec. 7435. Cross references.’

    (c) EFFECTIVE DATE- The amendments made by this section shall apply to false or fraudulent information returns filed after the date of the enactment of this Act.

SEC. 5503. REQUIREMENT TO VERIFY ACCURACY OF INFORMATION RETURNS.

    (a) GENERAL RULE- Section 6201 (relating to assessment authority) is amended by redesignating subsection (d) as subsection (e) and by inserting after subsection (c) the following new subsection:

    ‘(d) REQUIRED REASONABLE VERIFICATION OF INFORMATION RETURNS- In any court proceeding, if a taxpayer asserts a reasonable dispute with respect to any item of income reported on an information return filed with the Secretary under subpart B of part III of subchapter A of chapter 61 by a third party and the taxpayer has fully cooperated with the Secretary (including providing, within a reasonable period of time, access to and inspection of all witnesses, information, and documents within the control of the taxpayer as reasonably requested by the Secretary), the Secretary shall present reasonable and probative information concerning such deficiency in addition to such information return.’

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall take effect on the date of the enactment of this Act.

Subtitle G--Modifications to Penalty for Failure to Collect and Pay Over Tax

SEC. 5601. PRELIMINARY NOTICE REQUIREMENT.

    (a) IN GENERAL- Section 6672 (relating to failure to collect and pay over tax, or attempt to evade or defeat tax) is amended by redesignating subsection (b) as subsection (c) and by inserting after subsection (a) the following new subsection:

    ‘(b) PRELIMINARY NOTICE REQUIREMENT-

      ‘(1) IN GENERAL- No penalty shall be imposed under subsection (a) unless the Secretary notifies the taxpayer in writing by mail to an address as determined under section 6212(b) that the taxpayer shall be subject to an assessment of such penalty.

      ‘(2) TIMING OF NOTICE- The mailing of the notice described in paragraph (1) shall precede any notice and demand of any penalty under subsection (a) by at least 60 days.

      ‘(3) STATUTE OF LIMITATIONS- If a notice described in paragraph (1) with respect to any penalty is mailed before the expiration of the period provided by section 6501 for the assessment of such penalty (determined without regard to this paragraph), the period provided by such section for the assessment of such penalty shall not expire before the date 90 days after the date on which such notice was mailed.

      ‘(4) EXCEPTION FOR JEOPARDY- This subsection shall not apply if the Secretary finds that the collection of the penalty is in jeopardy.’

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to assessments made after June 30, 1994.

SEC. 5602. NO PENALTY IF PROMPT NOTIFICATION OF THE SECRETARY.

    (a) IN GENERAL- Section 6672 (relating to failure to collect and pay over tax, or attempt to evade or defeat tax) is amended by adding at the end thereof the following new subsection:

    ‘(d) PENALTY NOT APPLICABLE WHERE PROMPT NOTIFICATION OF FAILURE-

      ‘(1) IN GENERAL- A person shall not be liable for any penalty under subsection (a) by reason of any failure referred to in subsection (a) if--

        ‘(A) such person is not a significant owner, or highly compensated employee, of the trade or business with respect to which such failure occurred,

        ‘(B) such person notifies the Secretary (in such manner as he may prescribe) that such failure has occurred within 10 days after the date of such failure,

        ‘(C) such notification was before any notice by the Secretary to any person with respect to such failure, and

        ‘(D) such failure is not a part of a plan to defraud the Federal Government.

      ‘(2) DEFINITIONS- For purposes of paragraph (1)--

        ‘(A) SIGNIFICANT OWNER- The term ‘significant owner’ means--

          ‘(i) any person holding an interest as a proprietor in a trade or business carried on as a proprietorship, and

          ‘(ii) in the case of a trade or business conducted by a corporation or partnership, any person who is a 5-percent owner (as defined in section 416(i)(1)) in such corporation or partnership, as the case may be.

        ‘(B) HIGHLY COMPENSATED EMPLOYEE- The term ‘highly compensated employee’ means any employee who receives compensation from the employer at an annual rate in excess of $75,000.

      ‘(3) SPECIAL RULES-

        ‘(A) ONE-TIME RELIEF- This subsection shall apply only once with respect to--

          ‘(i) any person, and

          ‘(ii) any trade or business with respect to which the failure described in subsection (a) occurred.

        ‘(B) APPLICATION OF SUBSECTION- This subsection shall not apply if it results in no person being held liable for the penalty described in subsection (a).’

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply in the case of failures after the date of the enactment of this Act.

SEC. 5603. DISCLOSURE OF CERTAIN INFORMATION WHERE MORE THAN 1 PERSON SUBJECT TO PENALTY.

    (a) IN GENERAL- Subsection (e) of section 6103 (relating to disclosure to persons having material interest), as amended by section 5301, is amended by adding at the end thereof the following new paragraph:

      ‘(9) DISCLOSURE OF CERTAIN INFORMATION WHERE MORE THAN 1 PERSON SUBJECT TO PENALTY UNDER SECTION 6672- If the Secretary determines that a person is liable for a penalty under section 6672(a) with respect to any failure, upon request in writing of such person, the Secretary shall disclose in writing to such person--

        ‘(A) the name of any other person whom the Secretary has determined to be liable for such penalty with respect to such failure, and

        ‘(B) whether the Secretary has attempted to collect such penalty from such other person, the general nature of such collection activities, and the amount collected.’

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall take effect on the date of the enactment of this Act.

SEC. 5604. PENALTIES UNDER SECTION 6672.

    (a) PUBLIC INFORMATION REQUIREMENTS- The Secretary of the Treasury or the Secretary’s delegate (hereafter in this section referred to as the ‘Secretary’) shall take such actions as may be appropriate to ensure that employees are aware of their responsibilities under the Federal tax depository system, the circumstances under which employees may be liable for the penalty imposed by section 6672 of the Internal Revenue Code of 1986, and the responsibility to promptly report to the Internal Revenue Service any failure referred to in subsection (a) of such section 6672. Such actions shall include--

      (1) printing of a warning on deposit coupon booklets and the appropriate tax returns that certain employees may be liable for the penalty imposed by such section 6672, and

      (2) the development of a special information packet.

    (b) BOARD MEMBERS OF TAX-EXEMPT ORGANIZATIONS-

      (1) VOLUNTARY BOARD MEMBERS-

        (A) IN GENERAL- The penalty under section 6672 of the Internal Revenue Code of 1986 shall not be imposed on unpaid, volunteer members of any board of trustees or directors of an organization referred to in section 501 of such Code to the extent such members are solely serving in an honorary capacity, do not participate in the day-to-day or financial operations of the organization, and do not have actual knowledge of the failure on which such penalty is imposed.

        (B) APPLICATION OF PARAGRAPH- This paragraph shall not apply if it results in no person being held liable for the penalty described in section 6672(a) of the Internal Revenue Code of 1986.

      (2) DEVELOPMENT OF EXPLANATORY MATERIALS- The Secretary shall develop materials explaining the circumstances under which board members of tax-exempt organizations (including voluntary and honorary members) may be subject to penalty under section 6672 of such Code. Such materials shall be made available to tax-exempt organizations.

      (3) IRS INSTRUCTIONS- The Secretary shall clarify the instructions to Internal Revenue Service employees on the application of the penalty under section 6672 of such Code with regard to voluntary members of boards of trustees or directors of tax-exempt organizations.

    (c) PROMPT NOTIFICATION- To the maximum extent practicable, the Secretary shall notify all persons who have failed to make timely and complete deposit of any taxes described in section 6672 of the Internal Revenue Code of 1986 of such failure within 30 days after the return was filed reflecting such failure or after the date on which the Secretary is first aware of such failure. If the person failing to make the deposit is not an individual, the Secretary shall notify the entity subject to such deposit requirement and that entity shall notify, within 15 days of the notification by the Secretary, all officers, general partners, trustees, or other managers of the failure.

Subtitle H--Awarding of Costs and Certain Fees

SEC. 5701. MOTION FOR DISCLOSURE OF INFORMATION.

    Paragraph (4) of section 7430(c) (defining prevailing party) is amended by adding at the end thereof the following new subparagraph:

        ‘(C) MOTION FOR DISCLOSURE OF INFORMATION- Once a taxpayer substantially prevails as described in subparagraph (A)(ii), the taxpayer may file a motion for an order requiring the disclosure (within a reasonable period of time specified by the court) of all information and copies of relevant records in the possession of the Internal Revenue Service with respect to such taxpayer’s case and the substantial justification for the position taken by the Internal Revenue Service.’

SEC. 5702. INCREASED LIMIT ON ATTORNEY FEES.

    Paragraph (1) of section 7430(c) (defining reasonable litigation costs) is amended--

      (1) by striking ‘$75’ in clause (iii) of subparagraph (B) and inserting ‘$110’,

      (2) by striking ‘an increase in the cost of living or’ in clause (iii) of subparagraph (B), and

      (3) by adding after clause (iii) the following:

      ‘In the case of any calendar year beginning after 1993, the dollar amount referred to in clause (iii) shall be increased by an amount equal to such dollar amount multiplied by the cost-of-living adjustment determined under section 1(f)(3) for such calendar year, by substituting ‘calendar year 1992’ for ‘calendar year 1989’ in subparagraph (B) thereof. If any dollar amount after being increased under the preceding sentence is not a multiple of $10, such dollar amount shall be rounded to the nearest multiple of $10 (or, if such dollar amount is a multiple of $5, such dollar amount shall be increased to the next higher multiple of $10).’

SEC. 5703. FAILURE TO AGREE TO EXTENSION NOT TAKEN INTO ACCOUNT.

    Paragraph (1) of section 7430(b) (relating to requirement that administrative remedies be exhausted) is amended by adding at the end thereof the following new sentence: ‘Any failure to agree to an extension of the time for the assessment of any tax shall not be taken into account for purposes of determining whether the prevailing party meets the requirements of the preceding sentence.’

SEC. 5704. EFFECTIVE DATE.

    The amendments made by this subtitle shall apply in the case of proceedings commenced after the date of the enactment of this Act.

Subtitle I--Other Provisions

SEC. 5801. REQUIRED CONTENT OF CERTAIN NOTICES.

    (a) GENERAL RULE- Subsection (a) of section 7522 (relating to content of tax due, deficiency, and other notices) is amended by striking ‘shall describe the basis for, and identify’ and inserting ‘shall set forth the adjustments which are the basis for, and shall identify’.

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to notices sent after the date 6 months after the date of the enactment of this Act.

SEC. 5802. TREATMENT OF SUBSTITUTE RETURNS UNDER SECTION 6651.

    (a) GENERAL RULE- Section 6651 (relating to failure to file tax return or to pay tax) is amended by adding at the end thereof the following new subsection:

    ‘(h) TREATMENT OF RETURNS PREPARED BY SECRETARY UNDER SECTION 6020(b)- In the case of any return made by the Secretary under section 6020(b)--

      ‘(1) such return shall be disregarded for purposes of determining the amount of the addition under paragraph (1) of subsection (a), but

      ‘(2) such return shall be treated as the return filed by the taxpayer for purposes of determining the amount of the addition under paragraphs (2) and (3) of subsection (a).’

    (b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply in the case of any return the due date for which (determined without regard to extensions) is after the date of the enactment of this Act.

SEC. 5803. RELIEF FROM RETROACTIVE APPLICATION OF TREASURY DEPARTMENT REGULATIONS.

    (a) IN GENERAL- Subsection (b) of section 7805 (relating to rules and regulations) is amended to read as follows:

    ‘(b) RETROACTIVITY OF REGULATIONS-

      ‘(1) IN GENERAL- Except as otherwise provided in this subsection, no temporary, proposed, or final regulation relating to the internal revenue laws shall apply to any taxable period ending before the earliest of the following dates:

        ‘(A) The date on which such regulation is filed with the Federal Register.

        ‘(B) In the case of any final regulation, the date on which any proposed or temporary regulation to which such final regulation relates was filed with the Federal Register.

        ‘(C) The date on which any notice substantially describing the expected contents of any temporary, proposed, or final regulation is issued to the public.

      ‘(2) EXCEPTION FOR PROMPTLY ISSUED REGULATIONS- Paragraph (1) shall not apply to regulations issued within 12 months of the date of the enactment of the statutory provision to which the regulation relates.

      ‘(3) PREVENTION OF ABUSE- The Secretary may provide that any regulation may take effect or apply retroactively to prevent abuse of a statute to which the regulation relates.

      ‘(4) CORRECTION OF PROCEDURAL DEFECTS- The Secretary may provide that any regulation may apply retroactively to correct a procedural defect in the issuance of any prior regulation.

      ‘(5) INTERNAL REGULATIONS- The limitations of paragraph (1) shall not apply to any regulation relating to internal Treasury Department policies, practices or procedures.

      ‘(6) CONGRESSIONAL AUTHORIZATION- The limitation of paragraph (1) may be superseded by a legislative grant from Congress authorizing the Secretary to prescribe the effective date with respect to any regulation.

      ‘(7) ELECTION TO APPLY RETROACTIVELY- The Secretary may provide for any taxpayer to elect to apply any regulation before the dates specified in paragraph (1).

      ‘(8) APPLICATION TO RULINGS- The Secretary may prescribe the extent, if any, to which any ruling (including any judicial decision or any administrative determination other than by regulation) relating to the internal revenue laws shall be applied without retroactive effect.’

    (b) EFFECTIVE DATE-

      (1) IN GENERAL- Except as provided in paragraphs (2) and (3), the amendment made by subsection (a) shall apply with respect to--

        (A) any temporary or proposed regulation filed on or after January 5, 1993, and

        (B) any temporary or proposed regulation filed before January 5, 1993, and filed as a final regulation after such date.

      (2) SPECIAL RULE- Section 7805(b)(2) of the Internal Revenue Code of 1986 (as added by subsection (a)) shall apply only to statutes enacted on or after the date of the enactment of this Act.

SEC. 5804. REQUIRED NOTICE OF CERTAIN PAYMENTS.

    If any payment is received by the Secretary of the Treasury or the Secretary’s delegate (hereafter in the section referred to as the ‘Secretary’) from any taxpayer and the Secretary cannot associate such payment with any outstanding tax liability of such taxpayer, the Secretary shall make reasonable efforts to notify the taxpayer of such inability within 60 days after the receipt of such payment.

SEC. 5805. UNAUTHORIZED ENTICEMENT OF INFORMATION DISCLOSURE.

    (a) IN GENERAL- Subchapter B of chapter 76 (relating to proceedings by taxpayers and third parties) is amended by redesignating section 7434 as section 7435 and by inserting after section 7433 the following new section:

‘SEC. 7434. CIVIL DAMAGES FOR UNAUTHORIZED ENTICEMENT OF INFORMATION DISCLOSURE.

    ‘(a) IN GENERAL- If any officer or employee of the United States intentionally compromises the determination or collection of any tax due from an attorney, certified public accountant, or enrolled agent representing a taxpayer in exchange for information conveyed by the taxpayer to the attorney, certified public accountant, or enrolled agent for purposes of obtaining advice concerning the taxpayer’s tax liability, such taxpayer may bring a civil action for damages against the United States in a district court of the United States. Such civil action shall be the exclusive remedy for recovering damages resulting from such actions.

    ‘(b) DAMAGES- In any action brought under subsection (a), upon a finding of liability on the part of the defendant, the defendant shall be liable to the plaintiff in an amount equal to the lesser of $500,000 or the sum of--

      ‘(1) actual, direct economic damages sustained by the plaintiff as a proximate result of the information disclosure, and

      ‘(2) the costs of the action.

    Damages shall not include the taxpayer’s liability for any civil or criminal penalties, or other losses attributable to incarceration or the imposition of other criminal sanctions.

    ‘(c) PAYMENT AUTHORITY- Claims pursuant to this section shall be payable out of funds appropriated under section 1304 of title 31, United States Code.

    ‘(d) PERIOD FOR BRINGING ACTION- Notwithstanding any other provision of law, an action to enforce liability created under this section may be brought without regard to the amount in controversy and may be brought only within 2 years after the date the actions creating such liability would have been discovered by exercise of reasonable care.

    ‘(e) MANDATORY STAY- Upon a certification by the Commissioner or the Commissioner’s delegate that there is an ongoing investigation or prosecution of the taxpayer, the district court before which an action under this section is pending, shall stay all proceedings with respect to such action pending the conclusion of the investigation or prosecution.

    ‘(f) CRIME-FRAUD EXCEPTION- Subsection (a) shall not apply to information conveyed to an attorney, certified public accountant, or enrolled agent for the purpose of perpetrating a fraud or crime.’

    (b) CLERICAL AMENDMENT- The table of sections for subchapter B of chapter 76 is amended by striking the item relating to section 7434 and by adding at the end thereof the following new items:

‘Sec. 7434. Civil damages for unauthorized enticement of information disclosure.

‘Sec. 7435. Cross references.’

    (c) EFFECTIVE DATE- The amendments made by this section shall apply to actions after the date of the enactment of this Act.

Subtitle J--Form Modifications; Studies

SEC. 5900. DEFINITIONS.

    For purposes of this subtitle:

      (1) SECRETARY- The term ‘Secretary’ means the Secretary of the Treasury or his delegate.

      (2) 1986 CODE- The term ‘1986 Code’ means the Internal Revenue Code of 1986.

      (3) TAX-WRITING COMMITTEES- The term ‘tax-writing Committees’ means the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate.

PART I--FORM MODIFICATIONS

SEC. 5901. EXPLANATION OF CERTAIN PROVISIONS.

    (a) GENERAL RULE- The Secretary shall take such actions as may be appropriate to ensure that taxpayers are aware of the provisions of the 1986 Code permitting payment of tax in installments, extensions of time for payment of tax, and compromises of tax liability. Such actions shall include revising the instructions for filing income tax returns so that such instructions include an explanation of--

      (1) the procedures for requesting the benefits of such provisions, and

      (2) the terms and conditions under which the benefits of such provisions are available.

    (b) COLLECTION NOTICES- In any notice of an underpayment of tax or proposed underpayment of tax sent by the Secretary to any taxpayer, the Secretary shall include a notification of the availability of the provisions of sections 6159, 6161, and 7122 of the 1986 Code.

SEC. 5902. IMPROVED PROCEDURES FOR NOTIFYING SERVICE OF CHANGE OF ADDRESS OR NAME.

    The Secretary shall provide improved procedures for taxpayers to notify the Secretary of changes in names and addresses. Not later than June 30, 1994, the Secretary shall institute procedures for timely updating all Internal Revenue Service records with change-of-address information provided to the Secretary by taxpayers.

SEC. 5903. RIGHTS AND RESPONSIBILITIES OF DIVORCED INDIVIDUALS.

    The Secretary shall include in the Internal Revenue Service publication entitled ‘Your Rights As A Taxpayer’ a section on the rights and responsibilities of divorced individuals.

PART II--STUDIES

SEC. 5911. PILOT PROGRAM FOR APPEAL OF ENFORCEMENT ACTIONS.

    (a) GENERAL RULE- The Secretary shall establish a 1-year pilot program for appeals of enforcement actions (including lien, levy, and seizure actions) to the Appeals Division of the Internal Revenue Service--

      (1) where the deficiency was assessed without actual knowledge of the taxpayer,

      (2) where the deficiency was assessed without an opportunity for administrative appeal, and

      (3) in other appropriate circumstances.

    (b) REPORT- Not later than June 30, 1994, the Secretary shall submit to the tax-writing Committees a report on the pilot program established under subsection (a), together with such recommendations as he may deem advisable.

SEC. 5912. STUDY ON TAXPAYERS WITH SPECIAL NEEDS.

    (a) GENERAL RULE- The Secretary shall conduct a study on ways to assist the elderly, physically impaired, foreign-language speaking, and other taxpayers with special needs to comply with the internal revenue laws.

    (b) REPORT- Not later than June 30, 1994, the Secretary shall submit to the tax-writing Committees a report on the study conducted under subsection (a), together with such recommendations as he may deem advisable.

SEC. 5913. REPORTS ON TAXPAYER-RIGHTS EDUCATION PROGRAM.

    Not later than April 1, 1994, the Secretary shall submit a report to the tax-writing Committees on the scope and content of the Internal Revenue Service’s taxpayer-rights education program for its officers and employees. Not later than June 30, 1994, the Secretary shall submit a report to the tax-writing Committees on the effectiveness of the program referred to in the preceding sentence.

SEC. 5914. BIENNIAL REPORTS ON MISCONDUCT BY INTERNAL REVENUE SERVICE EMPLOYEES.

    During June 30, 1994 and during June of each second calendar year thereafter, the Secretary shall report to the tax-writing Committees on all cases involving complaints about misconduct of Internal Revenue Service employees and the disposition of such complaints.

SEC. 5915. STUDY OF NOTICES OF DEFICIENCY.

    (a) GENERAL RULE- The Comptroller General shall conduct a study on--

      (1) the effectiveness of current Internal Revenue Service efforts to notify taxpayers with regard to tax deficiencies under section 6212 of the 1986 Code,

      (2) the number of registered or certified letters and other notices returned to the Internal Revenue Service as undeliverable,

      (3) any follow-up action taken by the Internal Revenue Service to locate taxpayers who did not receive actual notice,

      (4) the effect that failures to receive notice of such deficiencies have on taxpayers, and

      (5) recommendations to improve Internal Revenue Service notification of taxpayers.

    (b) REPORT- Not later than June 30, 1994, the Comptroller General shall submit to the tax-writing Committees a report on the study conducted under subsection (a), together with such recommendations as he may deem advisable.

SEC. 5916. NOTICE AND FORM ACCURACY STUDY.

    (a) GENERAL RULE- The Comptroller General shall conduct annual studies of the accuracy of 25 of the most commonly used Internal Revenue Service forms, notices, and publications. In conducting any such study, the Comptroller General shall examine the suitability and usefulness of Internal Revenue Service telephone numbers on Internal Revenue Service notices and shall solicit and consider the comments of organizations representing taxpayers, employers, and tax professionals.

    (b) REPORTS- The Comptroller General shall submit to the tax-writing Committees a report on each study conducted under subsection (a), together with such recommendations as he may deem advisable. The first such report shall be submitted not later than June 30, 1994.

TITLE VI--OTHER INTERNAL REVENUE CODE PROVISIONS

Subtitle A--Extension of Authority for Undercover Operations; Cash-Transaction Reports

SEC. 6001. EXTENSION OF AUTHORITY FOR UNDERCOVER OPERATIONS.

    (a) 3-YEAR EXTENSION-

      (1) IN GENERAL- Subsection (c) of section 7608 (relating to undercover operations) is amended by adding at the end thereof the following new paragraph:

      ‘(6) TERMINATION- The provisions of this subsection shall cease to apply on and after September 1, 1995; and all amounts expended pursuant to this subsection shall be recovered to the extent possible, and deposited in the Treasury of the United States as miscellaneous receipts, before such date.’

      (2) CONFORMING AMENDMENT- Paragraph (3) of section 7601(c) of the Anti-Drug Abuse Act of 1988 is amended by striking all that follows ‘this Act’ and inserting a period.

      (3) EFFECTIVE DATE- The amendments made by this subsection shall take effect on January 1, 1992.

    (b) ENHANCED OVERSIGHT-

      (1) ADDITIONAL INFORMATION REQUIRED IN REPORTS TO CONGRESS- Subparagraph (B) of section 7608(c)(4) is amended--

        (A) by striking ‘preceding the period’ in clause (ii),

        (B) by striking ‘and’ at the end of clause (ii), and

        (C) by striking clause (iii) and inserting the following:

          ‘(iii) the number, by programs, of undercover investigative operations closed in the 1-year period for which such report is submitted, and

          ‘(iv) the following information with respect to each undercover investigative operation pending as of the end of the 1-year period for which such report is submitted or closed during such 1-year period--

            ‘(I) the date the operation began and the date of the certification referred to in the last sentence of paragraph (1),

            ‘(II) the total expenditures under the operation and the amount and use of the proceeds from the operation,

            ‘(III) a detailed description of the operation including the potential violation being investigated and whether the operation is being conducted under grand jury auspices, and

            ‘(IV) the results of the operation including the results of criminal proceedings.’

      (2) AUDITS REQUIRED WITHOUT REGARD TO AMOUNTS INVOLVED- Subparagraph (C) of section 7608(c)(5) is amended to read as follows:

        ‘(C) UNDERCOVER INVESTIGATIVE OPERATION- The term ‘undercover investigative operation’ means any undercover investigative operation of the Service; except that, for purposes of subparagraphs (A) and (C) of paragraph (4), such term only includes an operation which is exempt from section 3302 or 9102 of title 31, United States Code.’

      (3) EFFECTIVE DATE- The amendments made by this subsection shall take effect on the date of the enactment of this Act.

SEC. 6002. DISCLOSURE OF RETURNS ON CASH TRANSACTIONS.

    (a) GENERAL RULE- Subsection (l) of section 6103 (relating to disclosure of returns and return information for purposes other than tax administration) is amended by adding at the end thereof the following new paragraph:

      ‘(13) DISCLOSURE OF RETURNS FILED UNDER SECTION 6050I- The Secretary may, upon written request, disclose to officers and employees of--

        ‘(A) any Federal agency,

        ‘(B) any agency of a State or local government, or

        ‘(C) any agency of the government of a foreign country,

      information contained on returns filed under section 6050I. Any such disclosure shall be made on the same basis, and subject to the same conditions, as apply to disclosures of information on reports filed under section 5313 of title 31, United States Code; except that no disclosure under this paragraph shall be made for purposes of the administration of any tax law.’

    (b) CONFORMING AMENDMENTS-

      (1) Subsection (i) of section 6103 is amended by striking paragraph (8).

      (2) Subparagraph (A) of section 6103(p)(3) is amended--

        (A) by striking ‘(7)(A)(ii), or (8)’ and inserting ‘or (7)(A)(ii)’, and

        (B) by striking ‘or (12)’ and inserting ‘(12), or (13)’.

      (3) The material preceding subparagraph (A) of section 6103(p)(4) is amended--

        (A) by striking ‘(5), or (8)’ and inserting ‘or (5)’,

        (B) by striking ‘(i)(3)(B)(i) or (8)’ and inserting ‘(i)(3)(B)(i)’, and

        (C) by striking ‘or (12)’ and inserting ‘(12), or (13)’.

      (4) Clause (ii) of section 6103(p)(4)(F) is amended--

        (A) by striking ‘(5), or (8)’ and inserting ‘or (5)’, and

        (B) by striking ‘or (12) and inserting ‘(12), or (13)’.

      (5) Paragraph (2) of section 7213(a) is amended by striking ‘or (12)’ and inserting ‘(12), or (13)’.

    (c) EFFECTIVE DATE- The amendments made by this section shall take effect on the date of the enactment of this Act.

Subtitle B--Provisions Relating to Exempt Organizations

SEC. 6101. CERTAIN ORGANIZATIONS REQUIRED TO DISCLOSE NONEXEMPT STATUS.

    (a) GENERAL RULE- Subchapter B of chapter 61 (relating to miscellaneous provisions) is amended by redesignating section 6115 as section 6116 and by inserting after section 6114 the following new section:

‘SEC. 6115. CERTAIN ORGANIZATIONS REQUIRED TO DISCLOSE NONEXEMPT STATUS.

    ‘(a) IN GENERAL- If--

      ‘(1) in an advertisement or solicitation by (or on behalf of) an organization, such organization is referred to as being nonprofit, and

      ‘(2) such organization is not exempt from tax under subtitle A,

    such advertisement or solicitation shall contain an express statement (in a conspicuous and easily recognizable format) that such organization is not exempt from Federal income taxes.

    ‘(b) Cross Reference-

‘For penalties for violation of subsection (a), see section 6714.’

    (b) PENALTY- Part I of subchapter B of chapter 68 is amended by adding at the end thereof the following new section:

‘SEC. 6714. FAILURE TO DISCLOSE NONEXEMPT STATUS.

    ‘(a) IMPOSITION OF PENALTY- If there is a failure to meet the requirements of section 6115 with respect to any advertisement or solicitation by (or on behalf of) an organization, such organization shall pay a penalty of $1,000 for each day on which such a failure occurred. The maximum penalty imposed under this subsection on failures by any organization during any calendar year shall not exceed $10,000.

    ‘(b) REASONABLE CAUSE EXEMPTION- No penalty shall be imposed under this section with respect to any failure if it is shown that such failure is due to reasonable cause.

    ‘(c) $10,000 LIMITATION NOT TO APPLY WHERE INTENTIONAL DISREGARD- If any failure to which subsection (a) applies is due to intentional disregard of the requirements of section 6115--

      ‘(1) the penalty under subsection (a) for the day on which failure occurred shall be the greater of--

        ‘(A) $1,000, or

        ‘(B) 50 percent of the aggregate cost of the advertisements and solicitations which occurred on such day and with respect to which there was such failure,

      ‘(2) the $10,000 limitation of subsection (a) shall not apply to any penalty under subsection (a) for the day on which such failure occurred, and

      ‘(3) such penalty shall not be taken into account in applying such limitation to other penalties under subsection (a).

    ‘(d) DAY ON WHICH FAILURE OCCURS- For purposes of this section, rules similar to the rules of section 6710(d) shall apply in determining the day on which any failure occurs.’

    (c) CLERICAL AMENDMENTS-

      (1) The table of sections for subchapter B of chapter 61 is amended by striking the item relating to section 6115 and inserting the following:

‘Sec. 6115. Certain organizations required to disclose nonexempt status.

‘Sec. 6116. Cross reference.’

      (2) The table of sections of part I of subchapter B of chapter 68 is amended by adding at the end thereof the following new item:

‘Sec. 6714. Failure to disclose nonexempt status.’

    (d) EFFECTIVE DATE- The amendments made by this section shall take effect on January 1, 1994.

SEC. 6102. EXEMPT ORGANIZATIONS REQUIRED TO PROVIDE COPY OF RETURN.

    (a) GENERAL RULE-

      (1) Subparagraph (A) of section 6104(e)(1) (relating to public inspection of annual returns) is amended to read as follows:

        ‘(A) IN GENERAL- During the 3-year period beginning on the filing date--

          ‘(i) a copy of the annual return filed under section 6033 (relating to returns by exempt organizations) by any organization to which this paragraph applies shall be made available by such organization for inspection during regular business hours by any individual at the principal office of such organization and, if such organization regularly maintains 1 or more regional or district offices having 3 or more employees, at each such regional or district office, and

          ‘(ii) upon request of an individual made at such principal office or such a regional or district office, a copy of such annual return shall be provided to such individual without charge other than a reasonable fee for the cost of reproduction.

        If the request under clause (ii) is made in person, such copy shall be provided immediately and, if made other than in person, shall be provided within 30 days.’

      (2) Clause (ii) of section 6104(e)(2)(A) is amended by inserting before the period at the end thereof the following: ‘(and, upon request of an individual made at such principal office or such a regional or district office, a copy of the material required to be available for inspection under this subparagraph shall be provided (in accordance with the last sentence of paragraph (1)(A)) to such individual without charge other than a reasonable fee for the cost of reproduction)’.

    (b) ADVERTISEMENTS ETC., REQUIRED TO DISCLOSE AVAILABILITY OF ANNUAL RETURN-

      (1) Paragraph (1) of section 6104(e) is amended by adding at the end thereof the following new subparagraph:

        ‘(E) ADVERTISEMENTS ETC., REQUIRED TO DISCLOSE AVAILABILITY OF ANNUAL RETURN- In the case of an organization required by subparagraph (A) to provide a copy of its annual return under section 6033 upon request to individuals, each advertisement or solicitation by (or on behalf of) such organization shall contain an express statement (in a conspicuous and easily recognizable format) that such return shall be provided to individuals upon request.’

      (2) Section 6714 is amended--

        (A) by striking ‘section 6115’ each place it appears and inserting ‘section 6115 or section 6104(e)(1)(E)’,

        (B) by striking ‘$1,000’ in subsection (a) and inserting ‘$1,000 ($100 in the case of a failure to meet the requirements of 6104(e)(1)(E))’, and

        (C) by inserting before the period at the end of the section heading ‘; failure of certain exempt organizations to disclose availability of annual return’.

      (3) Subparagraph (C) of section 6652(c)(1) is amended by striking ‘(e)(1)’ and inserting ‘(e)(1) (other than subparagraph (E))’, and by striking ‘$10’ and inserting ‘$50’.

      (4) Subparagraph (D) of section 6652(c)(1) is amended by striking ‘$10’ and inserting ‘$50’.

      (5) The item relating to section 6714 in the table of sections for part I of subchapter B of chapter 68 is amended by inserting before the period ‘; failure of certain exempt organizations to disclose availability of annual return’.

    (c) EFFECTIVE DATE- The amendments made by this section shall take effect on January 1, 1994.

TITLE VII--PROHIBITION OF MISUSE OF DEPARTMENT OF THE TREASURY NAMES, SYMBOLS, ETC

SEC. 7001. PROHIBITION OF MISUSE OF DEPARTMENT OF THE TREASURY NAMES, SYMBOLS, ETC.

    (a) GENERAL RULE- Subchapter II of chapter 3 of title 31, United States Code, is amended by adding at the end thereof the following new section:

‘Sec. 333. Prohibition of misuse of Department of the Treasury names, symbols, etc.

    ‘(a) GENERAL RULE- No person may use, in connection with, or as a part of, any advertisement, solicitation, business activity, or product, whether alone or with other words, letters, symbols, or emblems--

      ‘(1) the words ‘Department of the Treasury’, or the name of any service, bureau, office, or other subdivision of the Department of the Treasury,

      ‘(2) the titles ‘Secretary of the Treasury’ or ‘Treasurer of the United States’ or the title of any other officer or employee of the Department of the Treasury,

      ‘(3) the abbreviations or initials of any entity referred to in paragraph (1),

      ‘(4) the words ‘United States Savings Bond’ or the name of any other obligation issued by the Department of the Treasury,

      ‘(5) any symbol or emblem of an entity referred to in paragraph (1) (including the design of any envelope or stationary used by such an entity), and

      ‘(6) any colorable imitation of any such words, titles, abbreviations, initials, symbols, or emblems,

    in a manner which could reasonably be interpreted or construed as conveying the false impression that such advertisement, solicitation, business activity, or product is in any manner approved, endorsed, sponsored, or authorized by, or associated with, the Department of the Treasury or any entity referred to in paragraph (1) or any officer or employee thereof.

    ‘(b) TREATMENT OF WAIVERS- Any determination of whether a person has violated the provisions of subsection (a) shall be made without regard to any use of a disclaimer of affiliation with the United States Government or any particular agency or instrumentality thereof.

    ‘(c) CIVIL PENALTY-

      ‘(1) IN GENERAL- The Secretary of the Treasury may impose a civil penalty on any person who violates the provisions of subsection (a).

      ‘(2) AMOUNT OF PENALTY- The amount of the civil penalty imposed by paragraph (1) shall not exceed $5,000 for each use of any material in violation of subsection (a). If such use is in a broadcast or telecast, the preceding sentence shall be applied by substituting ‘$25,000’ for ‘$5,000’.

      ‘(3) TIME LIMITATIONS-

        ‘(A) ASSESSMENTS- The Secretary of the Treasury may assess any civil penalty under paragraph (1) at any time before the end of the 3-year period beginning on the date of the violation with respect to which such penalty is imposed.

        ‘(B) CIVIL ACTION- The Secretary of the Treasury may commence a civil action to recover any penalty imposed under this subsection at any time before the end of the 2-year period beginning on the date on which such penalty was assessed.’.

    (b) CLERICAL AMENDMENT- The analysis for chapter 3 of title 31, United States Code, is amended by adding after the item relating to section 332 the following new item:

      ‘333. Prohibition of misuse of Department of the Treasury names, symbols, etc.’.

    (c) EFFECTIVE DATE- The amendments made by this section shall take effect on the date of the enactment of this Act.

    (d) REPORT- Not later than May 1, 1995, the Secretary of the Treasury shall submit a report to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate on the implementation of the amendments made by this section. Such report shall include the number of cases in which the Secretary has notified persons of violations of section 333 of title 31, United States Code (as added by subsection (a)), the number and amount of civil penalties assessed under such section, and the total amount of such penalties collected.