Authorization to allow claims for refund in certain cases where full tax not paid

(a) In general Section 7422, as amended by this Act, is amended by redesignating subsection (k) as subsection (l) and by inserting after subsection (j) the following new subsection: (k) Special rule for actions where there is an agreement in effect with the taxpayer under section 6159 or when the taxpayer is in currently not collectible status (1) In general The district courts of the United States, the United States Court of Federal Claims, and the Tax Court shall not fail to have jurisdiction over any applicable action brought by a taxpayer to determine the correct amount of liability of such taxpayer solely because the full amount of such liability has not been paid. (2) Applicable action For purposes of this subsection, the term applicable action means any action to determine the correct amount of the liability of such taxpayer (or for any refund with respect thereto) with respect to any amount if, as of the date such action is filed, such amount— (A) is the subject of an agreement under section 6159 for which all installments the due date for which is on or before the date the action is filed have been paid, or (B) has been determined by the Secretary to be not collectible (within the meaning of section 6343(e)). (3) Permissive dismissal (A) Request for dismissal The United States (or the Secretary, in the case of a case in the Tax Court) may request the dismissal of an applicable action if the taxpayer is no longer in compliance with an installment agreement under section 6159 or is no longer in currently not collectible status (within the meaning of section 6343(e)). (B) Court action In any case in which there is a request for dismissal under subparagraph (A), the court may, with or without taking any evidence or holding a hearing, dismiss the action with leave to refile when either the full amount of such liability has been paid or the conditions in paragraph (2) are met at the time of refiling. In deciding whether to dismiss the action, the court may consider the extent to which the action has proceeded, the extent to which full payment has been made, any burden that may result to the taxpayer, the United States, the Secretary, or the court from such dismissal (including reasons the taxpayer is no longer in compliance with an installment agreement under section 6159), and any other reason relating to the policy of the full payment rule. A dismissal under this paragraph shall not be reviewed by any other court. (4) Prohibition on collection of disallowed liability If the court redetermines under paragraph (1) the correct amount of liability of the taxpayer, no part of such liability which is disallowed by a decision of such court which has become final may be collected by the Secretary, and amounts paid in excess of the amount determined by the court as correctly paid shall be refunded.. (b) Effective date The amendments made by this section shall apply to actions filed on or after the date that is 12 months after the date of the enactment of this Act.