HR 3801 — Employer Reporting Improvement Act

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

 A. Changes in Existing Law Proposed by the Bill, as Reported

 In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, and existing law in which no 
change is proposed is shown in roman):

 INTERNAL REVENUE CODE OF 1986

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Subtitle D--Miscellaneous Excise Taxes

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CHAPTER 43--QUALIFIED PENSION, ETC., PLANS

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SEC. 4980H. SHARED RESPONSIBILITY FOR EMPLOYERS REGARDING HEALTH 
 COVERAGE.

 (a) Large employers not offering health coverage.--If--
 (1) any applicable large employer fails to offer to 
 its full-time employees (and their dependents) the 
 opportunity to enroll in minimum essential coverage 
 under an eligible employer-sponsored plan (as defined 
 in section 5000A(f)(2)) for any month, and
 (2) at least one full-time employee of the applicable 
 large employer has been certified to the employer under 
 section 1411 of the Patient Protection and Affordable 
 Care Act as having enrolled for such month in a 
 qualified health plan with respect to which an 
 applicable premium tax credit or cost-sharing reduction 
 is allowed or paid with respect to the employee,
then there is hereby imposed on the employer an assessable 
payment equal to the product of the applicable payment amount 
and the number of individuals employed by the employer as full-
time employees during such month.
 (b) Large employers offering coverage with employees who 
qualify for premium tax credits or cost-sharing reductions.--
 (1) In general.--If--
 (A) an applicable large employer offers to 
 its full-time employees (and their dependents) 
 the opportunity to enroll in minimum essential 
 coverage under an eligible employer-sponsored 
 plan (as defined in section 5000A(f)(2)) for 
 any month, and
 (B) 1 or more full-time employees of the 
 applicable large employer has been certified to 
 the employer under section 1411 of the Patient 
 Protection and Affordable Care Act as having 
 enrolled for such month in a qualified health 
 plan with respect to which an applicable 
 premium tax credit or cost-sharing reduction is 
 allowed or paid with respect to the employee,
 then there is hereby imposed on the employer an 
 assessable payment equal to the product of the number 
 of full-time employees of the applicable large employer 
 described in subparagraph (B) for such month and an 
 amount equal to 1/12 of $3,000.
 (2) Overall limitation.--The aggregate amount of tax 
 determined under paragraph (1) with respect to all 
 employees of an applicable large employer for any month 
 shall not exceed the product of the applicable payment 
 amount and the number of individuals employed by the 
 employer as full-time employees during such month.
 (c) Definitions and special rules.--For purposes of this 
section--
 (1) Applicable payment amount.--The term ``applicable 
 payment amount'' means, with respect to any month, 
 1/12 of $2,000.
 (2) Applicable large employer.--
 (A) In general.--The term ``applicable large 
 employer'' means, with respect to a calendar 
 year, an employer who employed an average of at 
 least 50 full-time employees on business days 
 during the preceding calendar year.
 (B) Exemption for certain employers.--
 (i) In general.--An employer shall 
 not be considered to employ more than 
 50 full-time employees if--
 (I) the employer's workforce 
 exceeds 50 full-time employees 
 for 120 days or fewer during 
 the calendar year, and
 (II) the employees in excess 
 of 50 employed during such 120-
 day period were seasonal 
 workers.
 (ii) Definition of seasonal 
 workers.--The term ``seasonal worker'' 
 means a worker who performs labor or 
 services on a seasonal basis as defined 
 by the Secretary of Labor, including 
 workers covered by section 500.20(s)(1) 
 of title 29, Code of Federal 
 Regulations and retail workers employed 
 exclusively during holiday seasons.
 (C) Rules for determining employer size.--For 
 purposes of this paragraph--
 (i) Application of aggregation rule 
 for employers.--All persons treated as 
 a single employer under subsection (b), 
 (c), (m), or (o) of section 414 of the 
 Internal Revenue Code of 1986 shall be 
 treated as 1 employer.
 (ii) Employers not in existence in 
 preceding year.--In the case of an 
 employer which was not in existence 
 throughout the preceding calendar year, 
 the determination of whether such 
 employer is an applicable large 
 employer shall be based on the average 
 number of employees that it is 
 reasonably expected such employer will 
 employ on business days in the current 
 calendar year.
 (iii) Predecessors.--Any reference in 
 this subsection to an employer shall 
 include a reference to any predecessor 
 of such employer.
 (D) Application of employer size to 
 assessable penalties.--
 (i) In general.--The number of 
 individuals employed by an applicable 
 large employer as full-time employees 
 during any month shall be reduced by 30 
 solely for purposes of calculating--
 (I) the assessable payment 
 under subsection (a), or
 (II) the overall limitation 
 under subsection (b)(2).
 (ii) Aggregation.--In the case of 
 persons treated as 1 employer under 
 subparagraph (C)(i), only 1 reduction 
 under subclause (I) or (II) shall be 
 allowed with respect to such persons 
 and such reduction shall be allocated 
 among such persons ratably on the basis 
 of the number of full-time employees 
 employed by each such person.
 (E) Full-time equivalents treated as full-
 time employees.--Solely for purposes of 
 determining whether an employer is an 
 applicable large employer under this paragraph, 
 an employer shall, in addition to the number of 
 full-time employees for any month otherwise 
 determined, include for such month a number of 
 full-time employees determined by dividing the 
 aggregate number of hours of service of 
 employees who are not full-time employees for 
 the month by 120.
 (F) Exemption for health coverage under 
 TRICARE or the Department of Veterans 
 Affairs.--Solely for purposes of determining 
 whether an employer is an applicable large 
 employer under this paragraph for any month, an 
 individual shall not be taken into account as 
 an employee for such month if such individual 
 has medical coverage for such month under--
 (i) chapter 55 of title 10, United 
 States Code, including coverage under 
 the TRICARE program, or
 (ii) under a health care program 
 under chapter 17 or 18 of title 38, 
 United States Code, as determined by 
 the Secretary of Veterans Affairs, in 
 coordination with the Secretary of 
 Health and Human Services and the 
 Secretary.
 (3) Applicable premium tax credit and cost-sharing 
 reduction.--The term ``applicable premium tax credit 
 and cost-sharing reduction'' means--
 (A) any premium tax credit allowed under 
 section 36B,
 (B) any cost-sharing reduction under section 
 1402 of the Patient Protection and Affordable 
 Care Act, and
 (C) any advance payment of such credit or 
 reduction under section 1412 of such Act.
 (4) Full-time employee.--
 (A) In general.--The term ``full-time 
 employee'' means, with respect to any month, an 
 employee who is employed on average at least 30 
 hours of service per week.
 (B) Hours of service.--The Secretary, in 
 consultation with the Secretary of Labor, shall 
 prescribe such regulations, rules, and guidance 
 as may be necessary to determine the hours of 
 service of an employee, including rules for the 
 application of this paragraph to employees who 
 are not compensated on an hourly basis.
 (5) Inflation adjustment.--
 (A) In general.--In the case of any calendar 
 year after 2014, each of the dollar amounts in 
 subsection (b) and paragraph (1) shall be 
 increased by an amount equal to the product 
 of--
 (i) such dollar amount, and
 (ii) the premium adjustment 
 percentage (as defined in section 
 1302(c)(4) of the Patient Protection 
 and Affordable Care Act) for the 
 calendar year.
 (B) Rounding.--If the amount of any increase 
 under subparagraph (A) is not a multiple of 
 $10, such increase shall be rounded to the next 
 lowest multiple of $10.
 (6) Other definitions.--Any term used in this section 
 which is also used in the Patient Protection and 
 Affordable Care Act shall have the same meaning as when 
 used in such Act.
 (7) Tax nondeductible.--For denial of deduction for 
 the tax imposed by this section, see section 275(a)(6).
 (d) Administration and procedure.--
 (1) In general.--Any assessable payment provided by 
 this section shall be paid upon notice and demand by 
 the Secretary, and shall be assessed and collected in 
 the same manner as an assessable penalty under 
 subchapter B of chapter 68.
 (2) Time for payment.--The Secretary may provide for 
 the payment of any assessable payment provided by this 
 section on an annual, monthly, or other periodic basis 
 as the Secretary may prescribe.
 (3) Coordination with credits, etc..--The Secretary 
 shall prescribe rules, regulations, or guidance for the 
 repayment of any assessable payment (including 
 interest) if such payment is based on the allowance or 
 payment of an applicable premium tax credit or cost-
 sharing reduction with respect to an employee, such 
 allowance or payment is subsequently disallowed, and 
 the assessable payment would not have been required to 
 be made but for such allowance or payment.
 (4) Time for response.--The Secretary shall allow an 
 applicable large employer at least 90 days from the 
 date of the first letter which informs the employer of 
 a proposed assessment of the employer shared 
 responsibility payment under this section to respond to 
 the proposed assessment before taking any further 
 action with respect to such proposed assessment.

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Subtitle F--Procedure and Administration

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 CHAPTER 61--INFORMATION AND RETURNS

Subchapter A--RETURNS AND RECORDS

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PART III--INFORMATION RETURNS

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 Subpart D--INFORMATION REGARDING HEALTH INSURANCE COVERAGE

SEC. 6055. REPORTING OF HEALTH INSURANCE COVERAGE.

 (a) In general.--Every person who provides minimum essential 
coverage to an individual during a calendar year shall, at such 
time as the Secretary may prescribe, make a return described in 
subsection (b).
 (b) Form and manner of return.--
 (1) In general.--A return is described in this 
 subsection if such return--
 (A) is in such form as the Secretary may 
 prescribe, and
 (B) contains--
 (i) the name, address and TIN of the 
 primary insured and the name and TIN of 
 each other individual obtaining 
 coverage under the policy,
 (ii) the dates during which such 
 individual was covered under minimum 
 essential coverage during the calendar 
 year,
 (iii) in the case of minimum 
 essential coverage which consists of 
 health insurance coverage, information 
 concerning--
 (I) whether or not the 
 coverage is a qualified health 
 plan offered through an 
 Exchange established under 
 section 1311 of the Patient 
 Protection and Affordable Care 
 Act, and
 (II) in the case of a 
 qualified health plan, the 
 amount (if any) of any advance 
 payment under section 1412 of 
 the Patient Protection and 
 Affordable Care Act of any 
 cost-sharing reduction under 
 section 1402 of such Act or of 
 any premium tax credit under 
 section 36B with respect to 
 such coverage, and
 (iv) such other information as the 
 Secretary may require.
 For purposes of subparagraph (B)(i), in the case of any 
 individual whose name is required to be set forth in a 
 return under subsection (a), if the person required to 
 make a return under such subsection is unable to 
 collect information on the TINs of such individuals, 
 the Secretary may allow the individual's full name and 
 date of birth to be substituted for the name and TIN.
 (2) Information relating to employer-provided 
 coverage.--If minimum essential coverage provided to an 
 individual under subsection (a) consists of health 
 insurance coverage of a health insurance issuer 
 provided through a group health plan of an employer, a 
 return described in this subsection shall include--
 (A) the name, address, and employer 
 identification number of the employer 
 maintaining the plan,
 (B) the portion of the premium (if any) 
 required to be paid by the employer, and
 (C) if the health insurance coverage is a 
 qualified health plan in the small group market 
 offered through an Exchange, such other 
 information as the Secretary may require for 
 administration of the credit under section 45R 
 (relating to credit for employee health 
 insurance expenses of small employers).
 (c) Statements to be furnished to individuals with respect to 
whom information is reported.--
 (1) In general.--Every person required to make a 
 return under subsection (a) shall furnish to each 
 individual whose name is required to be set forth in 
 such return a written statement showing--
 (A) the name and address of the person 
 required to make such return and the phone 
 number of the information contact for such 
 person, and
 (B) the information required to be shown on 
 the return with respect to such individual.
 (2) Time for furnishing statements.--The written 
 statement required under paragraph (1) shall be 
 furnished on or before January 31 of the year following 
 the calendar year for which the return under subsection 
 (a) was required to be made.
 (3) Electronic delivery.--An individual shall be 
 deemed to have consented to receive the statement under 
 this subsection in electronic form if such individual 
 has affirmatively consented at any prior time, to the 
 person required to make such statement, to receive such 
 statement in electronic form. The preceding sentence 
 shall not apply if the individual revokes such consent 
 in writing.
 (d) Coverage provided by governmental units.--In the case of 
coverage provided by any governmental unit or any agency or 
instrumentality thereof, the officer or employee who enters 
into the agreement to provide such coverage (or the person 
appropriately designated for purposes of this section) shall 
make the returns and statements required by this section.
 (e) Minimum essential coverage.--For purposes of this 
section, the term ``minimum essential coverage'' has the 
meaning given such term by section 5000A(f).

SEC. 6056. CERTAIN EMPLOYERS REQUIRED TO REPORT ON HEALTH INSURANCE 
 COVERAGE.

 (a) In general.--Every applicable large employer required to 
meet the requirements of section 4980H with respect to its 
full-time employees during a calendar year shall, at such time 
as the Secretary may prescribe, make a return described in 
subsection (b).
 (b) Form and manner of return.--A return is described in this 
subsection if such return--
 (1) is in such form as the Secretary may prescribe, 
 and
 (2) contains--
 (A) the name, date, and employer 
 identification number of the employer,
 (B) a certification as to whether the 
 employer offers to its full-time employees (and 
 their dependents) the opportunity to enroll in 
 minimum essential coverage under an eligible 
 employer-sponsored plan (as defined in section 
 5000A(f)(2)),
 (C) if the employer certifies that the 
 employer did offer to its full-time employees 
 (and their dependents) the opportunity to so 
 enroll--
 (i) the length of any waiting period 
 (as defined in section 2701(b)(4) of 
 the Public Health Service Act) with 
 respect to such coverage,
 (ii) the months during the calendar 
 year for which coverage under the plan 
 was available,
 (iii) the monthly premium for the 
 lowest cost option in each of the 
 enrollment categories under the plan, 
 and
 (iv) the employer share of the total 
 allowed costs of benefits provided 
 under the plan,
 (D) the number of full-time employees for 
 each month during the calendar year,
 (E) the name, address, and TIN of each full-
 time employee during the calendar year and the 
 months (if any) during which such employee (and 
 any dependents) were covered under any such 
 health benefits plans, and
 (F) such other information as the Secretary 
 may require.
The Secretary shall have the authority to review the accuracy 
of the information provided under this subsection, including 
the applicable large employer's share under paragraph 
(2)(C)(iv).
 (c) Statements to be furnished to individuals with respect to 
whom information is reported.--
 (1) In general.--Every person required to make a 
 return under subsection (a) shall furnish to each full-
 time employee whose name is required to be set forth in 
 such return under subsection (b)(2)(E) a written 
 statement showing--
 (A) the name and address of the person 
 required to make such return and the phone 
 number of the information contact for such 
 person, and
 (B) the information required to be shown on 
 the return with respect to such individual.
 (2) Time for furnishing statements.--The written 
 statement required under paragraph (1) shall be 
 furnished on or before January 31 of the year following 
 the calendar year for which the return under subsection 
 (a) was required to be made.
 (3) Electronic delivery.--An individual shall be 
 deemed to have consented to receive the statement under 
 this subsection in electronic form if such individual 
 has affirmatively consented at any prior time, to the 
 person who is the employer of the individual during the 
 calendar year to which the statement relates, to 
 receive such statement in electronic form. The 
 preceding sentence shall not apply if the individual 
 revokes such consent in writing.
 (d) Coordination with other requirements.--To the maximum 
extent feasible, the Secretary may provide that--
 (1) any return or statement required to be provided 
 under this section may be provided as part of any 
 return or statement required under section 6051 or 
 6055, and
 (2) in the case of an applicable large employer 
 offering health insurance coverage of a health 
 insurance issuer, the employer may enter into an 
 agreement with the issuer to include information 
 required under this section with the return and 
 statement required to be provided by the issuer under 
 section 6055.
 (e) Coverage provided by governmental units.--In the case of 
any applicable large employer which is a governmental unit or 
any agency or instrumentality thereof, the person appropriately 
designated for purposes of this section shall make the returns 
and statements required by this section.
 (f) Definitions.--For purposes of this section, any term used 
in this section which is also used in section 4980H shall have 
the meaning given such term by section 4980H.

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CHAPTER 66--LIMITATIONS

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 Subchapter A--LIMITATIONS ON ASSESSMENT AND COLLECTION

SEC. 6501. LIMITATIONS ON ASSESSMENT AND COLLECTION.

 (a) General rule.--Except as otherwise provided in this 
section, the amount of any tax imposed by this title shall be 
assessed within 3 years after the return was filed (whether or 
not such return was filed on or after the date prescribed) or, 
if the tax is payable by stamp, at any time after such tax 
became due and before the expiration of 3 years after the date 
on which any part of such tax was paid, and no proceeding in 
court without assessment for the collection of such tax shall 
be begun after the expiration of such period. For purposes of 
this chapter, the term ``return'' means the return required to 
be filed by the taxpayer (and does not include a return of any 
person from whom the taxpayer has received an item of income, 
gain, loss, deduction, or credit).
 (b) Time return deemed filed.--
 (1) Early return.--For purposes of this section, a 
 return of tax imposed by this title, except tax imposed 
 by chapter 3, 4, 21, or 24, filed before the last day 
 prescribed by law or by regulations promulgated 
 pursuant to law for the filing thereof, shall be 
 considered as filed on such last day.
 (2) Return of certain employment and withholding 
 taxes.--For purposes of this section, if a return of 
 tax imposed by chapter 3, 4, 21, or 24 for any period 
 ending with or within a calendar year is filed before 
 April 15 of the succeeding calendar year, such return 
 shall be considered filed on April 15 of such calendar 
 year.
 (3) Return executed by Secretary.--Notwithstanding 
 the provisions of paragraph (2) of section 6020(b), the 
 execution of a return by the Secretary pursuant to the 
 authority conferred by such section shall not start the 
 running of the period of limitations on assessment and 
 collection.
 (4) Return of excise taxes.--For purposes of this 
 section, the filing of a return for a specified period 
 on which an entry has been made with respect to a tax 
 imposed under a provision of subtitle D (including a 
 return on which an entry has been made showing no 
 liability for such tax for such period) shall 
 constitute the filing of a return of all amounts of 
 such tax which, if properly paid, would be required to 
 be reported on such return for such period.
 (c) Exceptions.--
 (1) False return.--In the case of a false or 
 fraudulent return with the intent to evade tax, the tax 
 may be assessed, or a proceeding in court for 
 collection of such tax may be begun without assessment, 
 at any time.
 (2) Willful attempt to evade tax.--In case of a 
 willful attempt in any manner to defeat or evade tax 
 imposed by this title (other than tax imposed by 
 subtitle A or B), the tax may be assessed, or a 
 proceeding in court for the collection of such tax may 
 be begun without assessment, at any time.
 (3) No return.--In the case of failure to file a 
 return, the tax may be assessed, or a proceeding in 
 court for the collection of such tax may be begun 
 without assessment, at any time.
 (4) Extension by agreement.--
 (A) In general.--Where, before the expiration 
 of the time prescribed for the assessment of 
 any tax imposed by this title, except the 
 estate tax provided in chapter 11, both the 
 Secretary and the taxpayer have consented in 
 writing to its assessment after such time, the 
 tax may be assessed at any time prior to the 
 expiration of the period agreed upon. The 
 period so agreed upon may be extended by 
 subsequent agreements in writing made before 
 the expiration of the period previously agreed 
 upon.
 (B) Notice to taxpayer of right to refuse or 
 limit extension.--The Secretary shall notify 
 the taxpayer of the taxpayer's right to refuse 
 to extend the period of limitations, or to 
 limit such extension to particular issues or to 
 a particular period of time, on each occasion 
 when the taxpayer is requested to provide such 
 consent.
 (5) Tax resulting from changes in certain income tax 
 or estate tax credits.--For special rules applicable in 
 cases where the adjustment of certain taxes allowed as 
 a credit against income taxes or estate taxes results 
 in additional tax, see section 905(c) (relating to the 
 foreign tax credit for income tax purposes) and section 
 2016 (relating to taxes of foreign countries, States, 
 etc., claimed as credit against estate taxes).
 (6) Termination of private foundation status.--In the 
 case of a tax on termination of private foundation 
 status under section 507, such tax may be assessed, or 
 a proceeding in court for the collection of such tax 
 may be begun without assessment, at any time.
 (7) Special rule for certain amended returns.--Where, 
 within the 60-day period ending on the day on which the 
 time prescribed in this section for the assessment of 
 any tax imposed by subtitle A for any taxable year 
 would otherwise expire, the Secretary receives a 
 written document signed by the taxpayer showing that 
 the taxpayer owes an additional amount of such tax for 
 such taxable year, the period for the assessment of 
 such additional amount shall not expire before the day 
 60 days after the day on which the Secretary receives 
 such document.
 (8) Failure to notify Secretary of certain foreign 
 transfers.--
 (A) In general.--In the case of any 
 information which is required to be reported to 
 the Secretary pursuant to an election under 
 section 1295(b) or under section 1298(f), 6038, 
 6038A, 6038B, 6038D, 6046, 6046A, or 6048, the 
 time for assessment of any tax imposed by this 
 title with respect to any tax return, event, or 
 period to which such information relates shall 
 not expire before the date which is 3 years 
 after the date on which the Secretary is 
 furnished the information required to be 
 reported under such section.
 (B) Application to failures due to reasonable 
 cause.--If the failure to furnish the 
 information referred to in subparagraph (A) is 
 due to reasonable cause and not willful 
 neglect, subparagraph (A) shall apply only to 
 the item or items related to such failure.
 (9) Gift tax on certain gifts not shown on return.--
 If any gift of property the value of which (or any 
 increase in taxable gifts required under section 
 2701(d) which) is required to be shown on a return of 
 tax imposed by chapter 12 (without regard to section 
 2503(b)), and is not shown on such return, any tax 
 imposed by chapter 12 on such gift may be assessed, or 
 a proceeding in court for the collection of such tax 
 may be begun without assessment, at any time. The 
 preceding sentence shall not apply to any item which is 
 disclosed in such return, or in a statement attached to 
 the return, in a manner adequate to apprise the 
 Secretary of the nature of such item.
 (10) Listed transactions.--If a taxpayer fails to 
 include on any return or statement for any taxable year 
 any information with respect to a listed transaction 
 (as defined in section 6707A(c)(2)) which is required 
 under section 6011 to be included with such return or 
 statement, the time for assessment of any tax imposed 
 by this title with respect to such transaction shall 
 not expire before the date which is 1 year after the 
 earlier of--
 (A) the date on which the Secretary is 
 furnished the information so required, or
 (B) the date that a material advisor meets 
 the requirements of section 6112 with respect 
 to a request by the Secretary under section 
 6112(b) relating to such transaction with 
 respect to such taxpayer.
 (11) Certain orders of criminal restitution.--In the 
 case of any amount described in section 6201(a)(4), 
 such amount may be assessed, or a proceeding in court 
 for the collection of such amount may be begun without 
 assessment, at any time.
 (12) Certain taxes attributable to partnership 
 adjustments.--In the case of any partnership adjustment 
 determined under subchapter C of chapter 63, the period 
 for assessment of any tax imposed under chapter 2 or 2A 
 which is attributable to such adjustment shall not 
 expire before the date that is 1 year after--
 (A) in the case of an adjustment pursuant to 
 the decision of a court in a proceeding brought 
 under section 6234, such decision becomes 
 final, or
 (B) in any other case, 90 days after the date 
 on which the notice of the final partnership 
 adjustment is mailed under section 6231.
 (d) Request for prompt assessment.--Except as otherwise 
provided in subsection (c), (e), or (f), in the case of any tax 
(other than the tax imposed by chapter 11 of subtitle B, 
relating to estate taxes) for which return is required in the 
case of a decedent, or by his estate during the period of 
administration, or by a corporation, the tax shall be assessed, 
and any proceeding in court without assessment for the 
collection of such tax shall be begun, within 18 months after 
written request therefor (filed after the return is made and 
filed in such manner and such form as may be prescribed by 
regulations of the Secretary) by the executor, administrator, 
or other fiduciary representing the estate of such decedent, or 
by the corporation, but not after the expiration of 3 years 
after the return was filed. This subsection shall not apply in 
the case of a corporation unless--
 (1)(A) such written request notifies the Secretary 
 that the corporation contemplates dissolution at or 
 before the expiration of such 18-month period, (B) the 
 dissolution is in good faith begun before the 
 expiration of such 18-month period, and (C) the 
 dissolution is completed;
 (2)(A) such written request notifies the Secretary 
 that a dissolution has in good faith been begun, and 
 (B) the dissolution is completed; or
 (3) a dissolution has been completed at the time such 
 written request is made.
 (e) Substantial omission of items.--Except as otherwise 
provided in subsection (c)--
 (1) Income taxes.--In the case of any tax imposed by 
 subtitle A--
 (A) General rule.--If the taxpayer omits from 
 gross income an amount properly includible 
 therein and--
 (i) such amount is in excess of 25 
 percent of the amount of gross income 
 stated in the return, or
 (ii) such amount--
 (I) is attributable to one or 
 more assets with respect to 
 which information is required 
 to be reported under section 
 6038D (or would be so required 
 if such section were applied 
 without regard to the dollar 
 threshold specified in 
 subsection (a) thereof and 
 without regard to any 
 exceptions provided pursuant to 
 subsection (h)(1) thereof), and
 (II) is in excess of $5,000,
 the tax may be assessed, or a proceeding in 
 court for collection of such tax may be begun 
 without assessment, at any time within 6 years 
 after the return was filed.
 (B) Determination of gross income.--For 
 purposes of subparagraph (A)--
 (i) In the case of a trade or 
 business, the term ``gross income'' 
 means the total of the amounts received 
 or accrued from the sale of goods or 
 services (if such amounts are required 
 to be shown on the return) prior to 
 diminution by the cost of such sales or 
 services;
 (ii) An understatement of gross 
 income by reason of an overstatement of 
 unrecovered cost or other basis is an 
 omission from gross income; and
 (iii) In determining the amount 
 omitted from gross income (other than 
 in the case of an overstatement of 
 unrecovered cost or other basis), there 
 shall not be taken into account any 
 amount which is omitted from gross 
 income stated in the return if such 
 amount is disclosed in the return, or 
 in a statement attached to the return, 
 in a manner adequate to apprise the 
 Secretary of the nature and amount of 
 such item.
 (C) Constructive dividends.--If the taxpayer 
 omits from gross income an amount properly 
 includible therein under section 951(a), the 
 tax may be assessed, or a proceeding in court 
 for the collection of such tax may be done 
 without assessing, at any time within 6 years 
 after the return was filed.
 (2) Estate and gift taxes.--In the case of a return 
 of estate tax under chapter 11 or a return of gift tax 
 under chapter 12, if the taxpayer omits from the gross 
 estate or from the total amount of the gifts made 
 during the period for which the return was filed items 
 includible in such gross estate or such total gifts, as 
 the case may be, as exceed in amount 25 percent of the 
 gross estate stated in the return or the total amount 
 of gifts stated in the return, the tax may be assessed, 
 or a proceeding in court for the collection of such tax 
 may be begun without assessment, at any time within 6 
 years after the return was filed. In determining the 
 items omitted from the gross estate or the total gifts, 
 there shall not be taken into account any item which is 
 omitted from the gross estate or from the total gifts 
 stated in the return if such item is disclosed in the 
 return, or in a statement attached to the return, in a 
 manner adequate to apprise the Secretary of the nature 
 and amount of such item.
 (3) Excise taxes.--In the case of a return of a tax 
 imposed under a provision of subtitle D, if the return 
 omits an amount of such tax properly includible thereon 
 which exceeds 25 percent of the amount of such tax 
 reported thereon, the tax may be assessed, or a 
 proceeding in court for the collection of such tax may 
 be begun without assessment, at any time within 6 years 
 after the return is filed. In determining the amount of 
 tax omitted on a return, there shall not be taken into 
 account any amount of tax imposed by chapter 41, 42, 
 43, or 44 which is omitted from the return if the 
 transaction giving rise to such tax is disclosed in the 
 return, or in a statement attached to the return, in a 
 manner adequate to apprise the Secretary of the 
 existence and nature of such item.
 (f) Personal holding company tax.--If a corporation which is 
a personal holding company for any taxable year fails to file 
with its return under chapter 1 for such year a schedule 
setting forth--
 (1) the items of gross income and adjusted ordinary 
 gross income, described in section 543, received by the 
 corporation during such year, and
 (2) the names and addresses of the individuals who 
 owned, within the meaning of section 544 (relating to 
 rules for determining stock ownership), at any time 
 during the last half of such year more than 50 percent 
 in value of the outstanding capital stock of the 
 corporation,
the personal holding company tax for such year may be assessed, 
or a proceeding in court for the collection of such tax may be 
begun without assessment, at any time within 6 years after the 
return for such year was filed.
 (g) Certain income tax returns of corporations.--
 (1) Trusts or partnerships.--If a taxpayer determines 
 in good faith that it is a trust or partnership and 
 files a return as such under subtitle A, and if such 
 taxpayer is thereafter held to be a corporation for the 
 taxable year for which the return is filed, such return 
 shall be deemed the return of the corporation for 
 purposes of this section.
 (2) Exempt organizations.--If a taxpayer determines 
 in good faith that it is an exempt organization and 
 files a return as such under section 6033, and if such 
 taxpayer is thereafter held to be a taxable 
 organization for the taxable year for which the return 
 is filed, such return shall be deemed the return of the 
 organization for purposes of this section.
 (3) DISC.--If a corporation determines in good faith 
 that it is a DISC (as defined in section 992(a)) and 
 files a return as such under section 6011(c)(2) and if 
 such corporation is thereafter held to be a corporation 
 which is not a DISC for the taxable year for which the 
 return is filed, such return shall be deemed the return 
 of a corporation which is not a DISC for purposes of 
 this section.
 (h) Net operating loss or capital loss carrybacks.--In the 
case of a deficiency attributable to the application to the 
taxpayer of a net operating loss carryback or a capital loss 
carryback (including deficiencies which may be assessed 
pursuant to the provisions of section 6213(b)(3)), such 
deficiency may be assessed at any time before the expiration of 
the period within which a deficiency for the taxable year of 
the net operating loss or net capital loss which results in 
such carryback may be assessed.
 (i) Foreign tax carrybacks.--In the case of a deficiency 
attributable to the application to the taxpayer of a carryback 
under section 904(c) (relating to carryback and carryover of 
excess foreign taxes) or under section 907(f) (relating to 
carryback and carryover of disallowed foreign oil and gas 
taxes), such deficiency may be assessed at any time before the 
expiration of one year after the expiration of the period 
within which a deficiency may be assessed for the taxable year 
of the excess taxes described in section 904(c) or 907(f) which 
result in such carryback.
 (j) Certain credit carrybacks.--
 (1) In general.--In the case of a deficiency 
 attributable to the application to the taxpayer of a 
 credit carryback (including deficiencies which may be 
 assessed pursuant to the provisions of section 
 6213(b)(3)), such deficiency may be assessed at any 
 time before the expiration of the period within which a 
 deficiency for the taxable year of the unused credit 
 which results in such carryback may be assessed, or 
 with respect to any portion of a credit carryback from 
 a taxable year attributable to a net operating loss 
 carryback, capital loss carryback, or other credit 
 carryback from a subsequent taxable year, at any time 
 before the expiration of the period within which a 
 deficiency for such subsequent taxable year may be 
 assessed.
 (2) Credit carryback defined.--For purposes of this 
 subsection, the term ``credit carryback'' has the 
 meaning given such term by section 6511(d)(4)(C).
 (k) Tentative carryback adjustment assessment period.--In a 
case where an amount has been applied, credited, or refunded 
under section 6411 (relating to tentative carryback and refund 
adjustments) by reason of a net operating loss carryback, a 
capital loss carryback, or a credit carryback (as defined in 
section 6511(d)(4)(C)) to a prior taxable year, the period 
described in subsection (a) of this section for assessing a 
deficiency for such prior taxable year shall be extended to 
include the period described in subsection (h) or (j), 
whichever is applicable; except that the amount which may be 
assessed solely by reason of this subsection shall not exceed 
the amount so applied, credited, or refunded under section 
6411, reduced by any amount which may be assessed solely by 
reason of subsection (h) or (j), as the case may be.
 (l) Special rule for chapter 42 and similar taxes.--
 (1) In general.--For purposes of any tax imposed by 
 section 4912, by chapter 42 (other than section 4940), 
 or by section 4975, the return referred to in this 
 section shall be the return filed by the private 
 foundation, plan, trust, or other organization (as the 
 case may be) for the year in which the act (or failure 
 to act) giving rise to liability for such tax occurred. 
 For purposes of section 4940, such return is the return 
 filed by the private foundation for the taxable year 
 for which the tax is imposed.
 (2) Certain contributions to section 501(c)(3) 
 organizations.--In the case of a deficiency of tax of a 
 private foundation making a contribution in the manner 
 provided in section 4942(g)(3) (relating to certain 
 contributions to section 501(c)(3) organizations) 
 attributable to the failure of a section 501(c)(3) 
 organization to make the distribution prescribed by 
 section 4942(g)(3), such deficiency may be assessed at 
 any time before the expiration of one year after the 
 expiration of the period within which a deficiency may 
 be assessed for the taxable year with respect to which 
 the contribution was made.
 (3) Certain set-asides described in section 
 4942(g)(2).--In the case of a deficiency attributable 
 to the failure of an amount set aside by a private 
 foundation for a specific project to be treated as a 
 qualifying distribution under the provisions of section 
 4942(g)(2)(B)(ii), such deficiency may be assessed at 
 any time before the expiration of 2 years after the 
 expiration of the period within which a deficiency may 
 be assessed for the taxable year to which the amount 
 set aside relates.
 (4) Individual retirement plans.--
 (A) In general.--For purposes of any tax 
 imposed by section 4973 or 4974 in connection 
 with an individual retirement plan, the return 
 referred to in this section shall include the 
 income tax return filed by the person on whom 
 the tax under such section is imposed for the 
 year in which the act (or failure to act) 
 giving rise to the liability for such tax 
 occurred.
 (B) Rule in case of individuals not required 
 to file return.--In the case of a person who is 
 not required to file an income tax return for 
 such year--
 (i) the return referred to in this 
 section shall be the income tax return 
 that such person would have been 
 required to file but for the fact that 
 such person was not required to file 
 such return, and
 (ii) the 3-year period referred to in 
 subsection (a) with respect to the 
 return shall be deemed to begin on the 
 date by which the return would have 
 been required to be filed (excluding 
 any extension thereof).
 (C) Period for assessment in case of income 
 tax return.--In any case in which the return 
 with respect to a tax imposed by section 4973 
 is the individual's income tax return for 
 purposes of this section, subsection (a) shall 
 be applied by substituting a 6-year period in 
 lieu of the 3-year period otherwise referred to 
 in such subsection.
 (D) Exception for certain acquisitions of 
 property.--In the case of any tax imposed by 
 section 4973 that is attributable to acquiring 
 property for less than fair market value, 
 subparagraph (A) shall not apply.
 (m) Deficiencies attributable to election of certain 
credits.--The period for assessing a deficiency attributable to 
any election under section 30B(h)(9), 30C(e)(4), 30D(f)(6), 
35(g)(11), 40(f), 43, 45B, 45C(d)(4), 45H(g), or 51(j) (or any 
revocation thereof) shall not expire before the date 1 year 
after the date on which the Secretary is notified of such 
election (or revocation).
 (n) Assessable Payment of Employer Shared Responsibility.--In 
the case of any assessable payment under section 4980H, the 
period for assessment shall expire at the end of the 6-year 
period beginning on the due date for filing the return under 
section 6056 (or, if later, the date such return was filed) for 
the calendar year with respect to which such payment is 
determined.
 [(n)] (o) Cross reference.--For period of limitations for 
assessment and collection in the case of a joint income return 
filed after separate returns have been filed, see section 
6013(b)(3) and (4).

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