A bill to amend the Internal Revenue Code of 1986 to modify the rules relating to the suspension of interest and certain penalties where the taxpayer is not contacted by the Internal Revenue Service within 18 months.

Amends the Internal Revenue Code to modify provisions which suspend interest and penalties for taxpayers not contacted by the Internal Revenue Service (IRS) about additional tax liability within 18 months of the filing of their tax returns to deny certain tax shelter participants suspension of any interest or penalties accruing on or before October 3, 2004, except those participants who accept certain IRS tax shelter settlement initiatives (current law applies only to interest accruing after October 3, 2004).

Provides that the 18-month period for IRS notification of additional tax liability for taxpayers who file amended tax returns or return information showing additional tax liability begins on the date such amended returns or information are filed.