Adjustment of threshold for small disputes

(a) In general Section 7463, as amended by this Act, is amended— (1) by striking $50,000 each place it appears in subsections (a) and (f) and inserting $100,000, and (2) by adding at the end the following new subsection: (g) Inflation adjustment (1) In general In the case of any petition filed in a calendar year beginning after 2026, each of the $100,000 amounts in subsections (a) and (f) shall be increased by an amount equal to— (A) such dollar amount, multiplied by (B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year, determined by substituting calendar year 2025 for calendar year 2016 in subparagraph (A)(ii) thereof. (2) Rounding If any increase determined under paragraph (1) is not a multiple of $1,000, such increase shall be rounded to the next lowest multiple of $1,000.. (b) Proceedings for determination of employment status Section 7436(c)(1) is amended by striking if the amount of employment taxes placed in dispute is $50,000 or less for each calendar quarter involved and inserting if the amount of employment taxes placed in dispute is equal to or less than the dollar amount in effect under section 7463(a)(1) (determined at the time the pleading is filed under subsection (a)) for each calendar quarter involved. (c) Conforming amendments (1) Section 7443A(b)(3) is amended by striking $50,000 and inserting the dollar amount in effect under section 7463(a)(1) (determined at the time the pleading is filed). (2) Section 7463(f)(2) is amended by striking an appeal and inserting a petition. (3) The heading for section 7463 is amended by striking Disputes involving $50,000 or less and inserting Small disputes. (4) The item relating to section 7463 in the table of section for part II of subchapter C of chapter 76 is amended by striking Disputes involving $50,000 or less and inserting Small disputes. (d) Effective date The amendments made by this section shall apply to proceedings commencing after the date of the enactment of this Act.