H.R. 295: Protect and Save Act of 2013

113th Congress, 2013–2015. Text as of Jan 15, 2013 (Introduced).

Status & Summary | PDF | Source: GPO and Cato Institute Deepbills

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113th CONGRESS

1st Session

H. R. 295

IN THE HOUSE OF REPRESENTATIVES

January 15, 2013

introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to prevent identity theft and tax fraud, and for other purposes.

1.

Short title

This Act may be cited as the Protect and Save Act of 2013 .

2.

Authority to disclose return and return information in Federal and State prosecution law enforcement

(a)

In general

Subsection (k) of section 6103 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(11)

Disclosure of certain return information in connection with identity theft and fraudulent returns

(A)

In general

In the case of an investigation pertaining to the misuse of the identity of another person for purposes of filing a false or fraudulent return of tax, upon receipt of a written request which meets the requirements of subparagraph (C), the Secretary may disclose return information to officers and employees of any Federal law enforcement agency, or any officers and employees of any State or local law enforcement agency, who are personally and directly engaged in the investigation of any crimes implicated in such misuse, but only if any such law enforcement agency is part of a team with the Internal Revenue Service in such investigation.

(B)

Limitation on use of information

Information disclosed under this subparagraph shall be solely for the use of such officers and employees to whom such information is disclosed in such investigation.

(C)

Requirements

A request meets the requirements of this clause if—

(i)

the request is made by the head of the agency (or his delegate) involved in such investigation, and

(ii)

the request sets forth the specific reason why such disclosure may be relevant to the investigation.

(D)

Notification

The Secretary shall determine whether or not to grant the disclosure request described in subparagraph (A) and notify the petitioning law enforcement agency within 30 days of receiving the request. This determination shall be expedited in instances where the crimes of murder, murder for hire, or arson are involved as certified by the requesting agency’s head.

.

(b)

Conforming amendments

(1)

Paragraph (2) of section 6103(a) of such Code is amended by inserting or (k)(11) after subsection (i)(7)(A) .

(2)

Paragraph (4) of section 6103(p) of such Code is amended—

(A)

in the matter preceding subparagraph (A) by inserting or (11) after (k)(10) , and

(B)

in subparagraph (F)(ii) by striking or (10) and inserting (10) or (11).

(3)

Paragraph (2) of section 7213(a) of such Code is amended by inserting (k)(11), after (7)(A)(ii),.

(c)

Effective date

The amendment made by subsection (a) shall apply to disclosures made after the date of the enactment of this Act.

(d)

Rule of Construction

Nothing in section 6103 of the Internal Revenue Code of 1986 may be construed to prohibit Federal law enforcement officials from coordinating with State and local law enforcement agencies already investigating related crimes.

3.

Local law enforcement liaison

Section 7803 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

(e)

Local Law Enforcement Liaison

(1)

Establishment

The Commissioner of Internal Revenue shall establish within the Criminal Investigation Division of the Internal Revenue Service the position of Local Law Enforcement Liaison.

(2)

Duties

The Local Law Enforcement Liaison shall—

(A)

coordinate the investigation of tax fraud with State and local law enforcement agencies,

(B)

communicate the status of tax fraud cases involving identity theft, and

(C)

carry out such other duties as delegated by the Commissioner of Internal Revenue.

.

4.

PIN system for prevention of identity theft tax fraud

(a)

In general

Not later than 1 year after the date of the enactment of this Act, the Secretary of the Treasury (or the Secretary’s delegate) shall implement an identify theft tax fraud prevention program under which—

(1)

a person who has filed an identity theft affidavit with the Secretary may elect—

(A)

to be provided with a unique personal identification number to be included on any Federal tax return filed by such person, or

(B)

to prevent the processing of any Federal tax return submitted in an electronic format by a person purporting to be such person, and

(2)

the Secretary will provide additional identity verification safeguards for the processing of any Federal tax return filed by a person described in paragraph (1) in cases where a unique personal identification number is not included on the return.

5.

Study on the use of prepaid debit cards and commercial tax preparation software in tax fraud

(a)

In general

The Comptroller General of the United States shall conduct a study to examine the role of prepaid debit cards and commercial tax preparation software in facilitating fraudulent tax returns through identity theft.

(b)

Report

Not later than 6 months after the date of the enactment of this Act, the Comptroller General shall submit to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives a report with the results of the study conducted under subsection (a), together with any recommendations.

6.

Study on the use of e-filing in tax fraud

(a)

In general

The Comptroller General of the United States shall conduct a study to examine the role filing tax returns electronically (e-filing) and electronic tax returns play in either facilitating or preventing fraudulent tax returns through identity theft.

(b)

Report

Not later than 6 months after the date of the enactment of this Act, the Comptroller General shall submit to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives a report with the results of the study conducted under subsection (a), together with any recommendations.

7.

Restriction on access to the Death Master File

(a)

In general

The Secretary of Commerce shall not disclose information contained on the Death Master File to any person with respect to any individual who has died at any time during the previous two calendar years in which the request for disclosure is made or the succeeding calendar year unless such person is certified under the program established under subsection (b).

(b)

Certification program

(1)

In general

The Secretary of Commerce shall establish a program to certify persons who are eligible to access the information described in subsection (a) contained on the Death Master File.

(2)

Certification

A person shall not be certified under the program established under paragraph (1) unless the Secretary determines that such person has a legitimate fraud prevention interest in accessing the information described in subsection (a).

(c)

Imposition of penalty

Any person who is certified under the program established under subsection (b), who receives information described in subsection (a), and who during the period of time described in subsection (a)

(1)

discloses such information to any other person, or

(2)

uses any such information for any purpose other than to detect or prevent fraud,

shall pay a penalty of $1,000 for each such disclosure or use, but the total amount imposed under this subsection on such a person for any calendar year shall not exceed $50,000.
(d)

Exemption from Freedom of Information Act requirement with respect to certain records of deceased individuals

(1)

In general

The Social Security Administration shall not be compelled to disclose to any person who is not certified under the program established under subsection (b) the information described in subsection (a).

(2)

Treatment of information

For purposes of section 552 of title 5, United States Code, this section shall be considered a statute described in subsection (b)(3)(B) of such section 552.

8.

Extension of authority to disclose certain return information to prison officials

(a)

In general

Section 6103(k)(10) of the Internal Revenue Code of 1986 is amended by striking subparagraph (D).

(b)

Report from Federal Bureau of Prisons

Not later than 6 months after the date of the enactment of this Act, the head of the Federal Bureau of Prisons shall submit to Congress a detailed plan on how it will use the information provided from the Secretary of the Treasury under section 6103(k)(10) of the Internal Revenue Code of 1986 to reduce prison tax fraud.

(c)

Sense of House regarding State prison authorities

It is the sense of the House that the heads of State agencies charged with the administration of prisons should—

(1)

develop plans for using the information provided by the Secretary of the Treasury under section 6103(k)(10) of the Internal Revenue Code of 1986 to reduce prison tax fraud, and

(2)

coordinate with the Internal Revenue Service with respect to the use of such information.

9.

Treasury report on information sharing barriers with respect to identity theft

(a)

Review

(1)

In general

The Secretary of the Treasury (or the Secretary’s delegate) shall review whether current Federal tax laws and regulations related to the confidentiality and disclosure of return information prevent the effective enforcement of local, State, and Federal identity theft statutes. The review shall consider whether greater information sharing between the Internal Revenue Service and Federal, State and local law enforcement authorities would improve the enforcement of criminal laws at all levels of government.

(2)

Consultation

In conducting the review under paragraph (1), the Secretary shall solicit the views of, and consult with, State and local law enforcement officials. Among the Federal agencies the Secretary shall consult in conducting the review are the following:

(A)

The Department of Veterans Affairs.

(B)

The Department of Justice.

(C)

The United States Postal Inspection Service.

(D)

The Social Security Administration.

(b)

Report

Not later than 180 days after the date of enactment of this Act, the Secretary shall submit a report with the results of the review conducted under subsection (a), along with any legislative recommendations, to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives.