Sec. 503. Protecting the security of taxpayer information held by third-party providers by improving coordination and establishing minimum security requirements to reduce fragmentation
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/bill/117/s/2782/is/section-503·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Not later than 180 days after the date of the enactment of this Act, the Secretary of the Treasury (or the Secretary's delegate) shall prescribe standards for the security of return information and information technology systems that are consistent with security standards issued by the National Institute for Standards and Technology. Section 6695 of the Internal Revenue Code of 1986 is amended by redesignating subsection
(h)as subsection
(i)and by inserting after subsection
(g)the following new subsection: Any person who is authorized by the Secretary to provide electronic filing services and who fails to secure return information and information technology standards in such manner as prescribed by the Secretary shall pay a penalty of $500 for each such failure. The maximum penalty imposed under this subsection on any person with respect to any calendar year shall not exceed $25,000. . Section 6695(i) of such Code, as redesignated by subparagraph (A), is amended— by redesignating paragraph
(2)as paragraph (3); by inserting after paragraph
(1)the following new paragraph: In the case of any failure described in subsection
(h)in a calendar year beginning after 2022, each of the dollar amounts under subsection
(h)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 the calendar year determined by substituting calendar year 2021 for calendar year 2016 in subparagraph (A)(ii) thereof. ; and in paragraph
(3)(as redesignated by clause (i)), by striking paragraph
(1)and inserting paragraph
(1)or
(2). The amendments made by this paragraph shall apply to failures described in section 6695(h) of the Internal Revenue Code of 1986 (as added by subparagraph (A)) after the date that is 60 days after the date the Secretary prescribes the standards required under paragraph (1). Not later than 180 days after the date of enactment of this Act, the Commissioner of Internal Revenue shall develop an organizational plan to create a centralized body or other governance structure to coordinate all aspects of the Internal Revenue Service’s efforts to protect return information while being held or transmitted by those authorized by the Internal Revenue Service to provide electronic filing services. The Commissioner shall transmit the organizational plan to the Committee on Finance of the Senate, the Committee on Homeland Security and Governmental Affairs of the Senate , the Committee on Ways and Means of the House of Representatives , and the Committee on Oversight and Reform of the House of Representatives.