[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7959 Introduced in House (IH)]

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119th CONGRESS
  2d Session
                                H. R. 7959

 To amend the Internal Revenue Code of 1986 to make improvements with 
  respect to the treatment of whistleblowers, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 17, 2026

Mr. Kelly of Pennsylvania (for himself and Mr. Thompson of California) 
 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 make improvements with 
  respect to the treatment of whistleblowers, 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; ETC.

    (a) Short Title.--This Act may be cited as the ``IRS Whistleblower 
Program Improvement Act''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment is expressed in terms of an 
amendment to 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.
    (c) References to Secretary.--For purposes of this Act, the term 
``Secretary'' means the Secretary of the Treasury or the Secretary's 
delegate.
    (d) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; etc.
Sec. 2. Standard and scope of review of whistleblower award 
                            determinations.
Sec. 3. Whistleblower privacy protections.
Sec. 4. Modification of IRS whistleblower report.
Sec. 5. Interest on whistleblower awards.
Sec. 6. Correction regarding deductions for attorney's fees.

SEC. 2. STANDARD AND SCOPE OF REVIEW OF WHISTLEBLOWER AWARD 
              DETERMINATIONS.

    (a) In General.--Paragraph (4) of section 7623(b) is amended--
            (1) by striking ``appealed to'' and inserting ``reviewed 
        by'', and
            (2) by adding at the end the following: ``Any review by the 
        Tax Court under the preceding sentence shall be de novo and 
        shall be based on the administrative record established at the 
        time of the original determination and any additional newly 
        discovered or previously unavailable evidence.''.
    (b) Conforming Amendment.--The heading of paragraph (4) of section 
7623(b) is amended by striking ``Appeal'' and inserting ``Review''.
    (c) Effective Date.--The amendments made by this section shall 
apply to petitions under section 7623(b)(4) of the Internal Revenue 
Code of 1986 which are pending on, or filed on or after, the date of 
the enactment of this Act.

SEC. 3. WHISTLEBLOWER PRIVACY PROTECTIONS.

    (a) In General.--Paragraph (6) of section 7623(b) is amended by 
adding at the end the following new subparagraph:
                    ``(D) Whistleblower anonymity before the tax 
                court.--Notwithstanding sections 7458 and 7461, a 
                whistleblower shall proceed anonymously before the Tax 
                Court for all proceedings under this section absent a 
                finding by the Tax Court that a societal interest 
                exists for disclosing the whistleblower's identity 
                which exceeds the potential harm disclosure could cause 
                to the whistleblower.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to petitions filed with the Tax Court which are pending on, or filed on 
or after, the date of the enactment of this Act.

SEC. 4. MODIFICATION OF IRS WHISTLEBLOWER REPORT.

    (a) In General.--Section 406(c) of division A of the Tax Relief and 
Health Care Act of 2006 is amended by striking ``such use,'' in 
paragraph (1) and inserting ``such use (which shall include a list and 
descriptions of the top tax avoidance schemes, not to exceed 10, 
disclosed by whistleblowers during such year),''.
    (b) Effective Date.-- The amendments made by this section shall 
apply to reports for fiscal years ending after the enactment of this 
Act.

SEC. 5. INTEREST ON WHISTLEBLOWER AWARDS.

    (a) In General.--Section 7623(b) is amended by adding at the end 
the following new paragraph:
            ``(7) Interest.--
                    ``(A) In general.--If the Secretary has not 
                provided notice to an individual described in paragraph 
                (1) of a preliminary award recommendation before the 
                applicable date, the amount of any award under this 
                subsection shall include interest from such date at the 
                overpayment rate under section 6621(a).
                    ``(B) Exception.--No interest shall accrue under 
                this paragraph after the date on which the Secretary 
                provides notice to the individual of a preliminary 
                award recommendation.
                    ``(C) Applicable date.--For purposes of this 
                paragraph, the applicable date is the date that is 12 
                months after the first date on which--
                            ``(i) all of the proceeds resulting from 
                        actions subject to the award recommendation 
                        have been collected, and
                            ``(ii) either--
                                    ``(I) the statutory period for 
                                filing a claim or suit for refund has 
                                expired, or
                                    ``(II) the taxpayers subject to the 
                                actions and the Secretary have agreed 
                                with finality to the tax or other 
                                liabilities for the periods at issue, 
                                and either the taxpayers have waived 
                                the right to file a claim or suit for 
                                refund or any claim or suit for refund 
                                has been resolved.''.
    (b) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        take effect 180 days after the date of the enactment of this 
        Act.
            (2) Special rule.--If, as of the date described in 
        paragraph (1)--
                    (A) the Secretary has not provided notice to the 
                individual of a preliminary award recommendation as 
                described in paragraph (7)(A) of section 7623(b) of the 
                Internal Revenue Code of 1986, as added by this Act, 
                and
                    (B) the applicable date provided in paragraph 
                (7)(C) of such section, as so added, has passed,
        the applicable date for purposes of such paragraph (7)(C) is 
        the date that is 12 months after the date described in 
        paragraph (1).

SEC. 6. CORRECTION REGARDING DEDUCTIONS FOR ATTORNEY'S FEES.

    (a) In General.--Section 62(a)(21)(A)(i) is amended by striking 
``7623(b)'' and inserting ``7623''.
    (b) Effective Date.--The amendment made by this subsection shall 
apply to taxable years ending after the date of the enactment of this 
Act.
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