(1)

by striking The penalties and liabilities provided by this subchapter and inserting the following:

(1) In general

Any penalties provided by this title, including the penalties and liabilities provided by this subchapter,,

(2)

by striking the penalties and liabilities provided by this subchapter. and inserting the penalties provided by this title, including the penalties and liabilities provided by this subchapter., and

(3)

by adding at the end the following new paragraph:

(2) Exception

Paragraph (1) shall not apply to any penalty not provided by this subchapter if such penalty is a penalty for which a civil or criminal action is prescribed as the method of collection or has been consistently treated by the Secretary before the date of the enactment of this paragraph as such a penalty.

(1) In general

Subchapter C of chapter 68 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:

6752. Preliminary notice and right of review for covered penalties

(a) Notice

(1) In general

No covered penalty shall be assessed unless the Secretary provides a notice to the taxpayer in writing by mail to an address as determined under section 6212(b) that contains the following information:

(A)

The covered penalty proposed to be assessed.

(B)

The taxable years or periods involved.

(C)

The basis for the proposed penalty.

(D)

Information about the right of the taxpayer to request review as provided in subsection (b).

(2) Timing of notice

The mailing of the notice described in paragraph (1) shall precede any notice and demand of any covered penalty by at least 60 days (120 days in the case of a notice addressed to a taxpayer outside the United States).

(b) Right to a review

Within 60 days (120 days in the case of a notice sent to a taxpayer outside the United States) of the mailing of the notice described in subsection (a), the taxpayer may request a review of the proposed penalty by the Internal Revenue Service Independent Office of Appeals.

(c) Suspension of assessment and collection

(1) In general

A covered penalty may not be assessed, demanded, or collected before—

(A)

the expiration of the period provided under subsection (b), or

(B)

in any case in which the taxpayer requests a review under subsection (b), the date a final determination is issued in such review.

(2) Statute of limitations

If a notice described in subsection (a) with respect to any covered penalty is mailed before the expiration of the period provided by section 6501 for the assessment of such penalty (determined without regard to this paragraph), the running of such period shall be suspended for the period during which assessment is prohibited under this section and for 30 days thereafter.

(d) Covered penalty

For purposes of this section, the term covered penalty means any penalty imposed under section 6038(b)(1), 6038A(d)(1), 6038B(c), 6038C(c), 6038D(d)(1), 6039F(c)(1)(B), or 6677.

(e) Exception for jeopardy

This subsection shall not apply if the Secretary finds that the collection of the penalty is in jeopardy.

(f) Regulations

The Secretary shall prescribe such regulations or other guidance as may be necessary or appropriate to carry out this section, including regulations or other guidance relating to—

(1)

procedures for issuing notices under subsection (a),

(2)

the time and manner for presenting appropriate defenses under subsection (b)(2), and

(3)

establishing simplified reviews for cases in which the penalty amount at issue does not exceed a designated dollar threshold.

(2) Clerical amendment

The table of sections for subchapter C of chapter 68 of such Code is amended by adding at the end the following new item:

(1) Taxpayer rights

Nothing in the amendments made by this section shall be construed to create any limitation on the rights of a taxpayer—

(2) No inference

Nothing in the amendments made by this section shall be construed to create any inference with respect to the treatment of any covered penalty (as defined in section 6752 of the Internal Revenue Code of 1986, as added by this section) before the date of the enactment of this Act.