Tax Reform Act of 2005 - Senate Finance Committee Report 11/17/05
 
SEC
. 522. TERMINATION OF
INSTALLMENT AGREEMENTS.
(a) IN GENERAL. --Section 6159(b)(4) (relating to
failure to pay an installment or any other tax
liability when due or to provide requested financial
information) is amended by striking "or"
at the end of subparagraph (B), by redesignating
subparagraph (C) as subparagraph (E), and by
inserting after subparagraph (B) the following:
"(C)
to make a Federal tax deposit under section 6302 at
the time such deposit is required to be made,
"(D)
to file a return of tax imposed under this title by
its due date (including extensions), or".
(b) CONFORMING AMENDMENT. --The heading for section
6159(b)(4) is amended by striking "FAILURE TO
PAY AN INSTALLMENT OR ANY OTHER TAX LIABILITY WHEN
DUE OR TO PROVIDE REQUESTED FINANCIAL
INFORMATION" and inserting "FAILURE TO
MAKE PAYMENTS OR DEPOSITS OR
FILE
RETURNS WHEN DUE OR TO PROVIDE REQUESTED FINANCIAL
INFORMATION".
(c) EFFECTIVE DATE. --The amendments made by this
section shall apply to failures occurring on or
after the date of the enactment of this Act.
SEC
. 523. PARTIAL PAYMENTS REQUIRED WITH SUBMISSION
OF OFFERS-IN-COMPROMISE.
(a) IN GENERAL. --Section 7122 (relating to
compromises), as amended by this Act, is amended by
redesignating subsections (c), (d), and (e) as
subsections (d), (e), and (f), respectively, and by
inserting after subsection (b) the following new
subsection:
"(c) RULES FOR SUBMISSION OF
OFFERS-IN-COMPROMISE. --
"(1)
PARTIAL PAYMENT REQUIRED WITH SUBMISSION. --
"(A)
LUMP-SUM OFFERS. --
"(i)
IN GENERAL. --The submission of any lump-sum
offer-in-compromise shall be accompanied by the
payment of 20 percent of amount of such offer.
"(ii)
LUMP-SUM OFFER-IN-COMPROMISE. --For purposes of this
section, the term 'lump-sum offer-in-compromise'
means any offer of payments made in 5 or fewer
installments.
"(B)
PERIODIC PAYMENT OFFERS. --The submission of any
periodic payment offer-in-compromise shall be
accompanied by the payment of the amount of the
first proposed installment and each proposed
installment due during the period such offer is
being evaluated for acceptance and has not been
rejected by the Secretary. Any failure to make a
payment required under the preceding sentence shall
be deemed a withdrawal of the offer-in-compromise.
"(2)
RULES OF APPLICATION. --
"(A)
USE OF PAYMENT. --The application of any payment
made under this subsection to the assessed tax or
other amounts imposed under this title with respect
to such tax may be specified by the taxpayer.
"(B)
NO USER FEE IMPOSED. --Any user fee which would
otherwise be imposed under this section shall not be
imposed on any offerin-compromise accompanied by a
payment required under this subsection.
"(C)
WAIVER AUTHORITY. --The Secretary may issue
regulations waiving any payment required under
paragraph (1) in a manner consistent with the
practices established in accordance with the
requirements under subsection (d)(3).".
(b) ADDITIONAL RULES RELATING TO TREATMENT OF
OFFERS. --
(1) UNPROCESSABLE OFFER IF PAYMENT REQUIREMENTS
ARE
NOT
MET
. --Paragraph (3) of section 7122(d) (relating to
standards for evaluation of offers), as redesignated
by subsection (a), is amended by striking ";
and" at the end of subparagraph (A) and
inserting a comma, by striking the period at the end
of subparagraph (B) and inserting ", and",
and by adding at the end the following new
subparagraph:
"(C)
any offer-in-compromise which does not meet the
requirements of subsection (c) shall be returned to
the taxpayer as unprocessable.".
(2) DEEMED ACCEPTANCE OF OFFER NOT REJECTED WITHIN
CERTAIN PERIOD. --Section 7122, as amended by
subsection (a), is amended by adding at the end the
following new subsection:
"(g) DEEMED ACCEPTANCE OF OFFER NOT REJECTED
WITHIN CERTAIN PERIOD. --Any offer-in-compromise
submitted under this section shall be deemed to be
accepted by the Secretary if such offer is not
rejected by the Secretary before the date which is
24 months after the date of the submission of such
offer (12 months for offers-in-compromise submitted
after the date which is 5 years after the date of
the enactment of this subsection). For purposes of
the preceding sentence, any period during which any
tax liability which is the subject of such
offer-in-compromise is in dispute in any judicial
proceeding shall not be taken in to account in
determining the expiration of the 24-month period
(or 12-month period, if applicable).".
(c) EFFECTIVE DATE. --The amendments made by this
section shall apply to offers-in-compromise
submitted on and after the date which is 60 days
after the date of the enactment of this Act.
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