(a) Requirement of reporting (1) In general
The appropriate official of any government or any entity described in section 162(f)(5) which is involved in a suit or agreement described in paragraph (2) shall make a return in such form as determined by the Secretary setting forth—
(A) the amount required to be paid as a result of the suit or agreement to which paragraph (1) of section 162(f) applies,
(B) any amount required to be paid as a result of the suit or agreement which constitutes restitution or remediation of property, and
(C) any amount required to be paid as a result of the suit or agreement for the purpose of coming into compliance with any law which was violated or involved in the investigation or inquiry.
(2) Suit or agreement described (A) In general
A suit or agreement is described in this paragraph if—
(i) it is—
(I) a suit with respect to a violation of any law over which the government or entity has authority and with respect to which there has been a court order, or
(II) an agreement which is entered into with respect to a violation of any law over which the government or entity has authority, or with respect to an investigation or inquiry by the government or entity into the potential violation of any law over which such government or entity has authority, and
(ii) the aggregate amount involved in all court orders and agreements with respect to the violation, investigation, or inquiry is $600 or more.
(B) Adjustment of reporting threshold
The Secretary shall adjust the $600 amount in subparagraph (A)(ii) as necessary in order to ensure the efficient administration of the internal revenue laws.
(3) Time of filing
The return required under this subsection shall be filed at the time the agreement is entered into, as determined by the Secretary.
(b) Statements to be furnished to individuals involved in the settlement
Every person required to make a return under subsection (a) shall furnish to each person who is a party to the suit or agreement a written statement showing—
(1) the name of the government or entity, and
(2) the information supplied to the Secretary under subsection (a)(1).
The written statement required under the preceding sentence shall be furnished to the person at the same time the government or entity provides the Secretary with the information required under subsection (a).
(c) Appropriate official defined
For purposes of this section, the term "appropriate official" means the officer or employee having control of the suit, investigation, or inquiry or the person appropriately designated for purposes of this section.
EFFECTIVE DATE Pub. L. 115–97, title I, §13306(b)(3), Dec. 22, 2017, 131 Stat. 2129, provided that: "The amendments made by this subsection [enacting this section] shall apply to amounts paid or incurred on or after the date of the enactment of this Act [Dec. 22, 2017], except that such amendments shall not apply to amounts paid or incurred under any binding order or agreement entered into before such date. Such exception shall not apply to an order or agreement requiring court approval unless the approval was obtained before such date."
26 U.S.C. § 6050X (2018)
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