This legislation amends the Internal Revenue Code to strengthen procedural safeguards for taxpayers facing penalties and disallowance periods. It mandates that no penalty or disallowance period can be assessed unless the initial determination is personally approved in writing by an immediate supervisor. Crucially, this supervisory approval must be obtained *before* any notice regarding the penalty or disallowance period is sent to the taxpayer. The bill defines an "initial determination" as the first written notice to a taxpayer specifying a penalty amount or disallowance period based on their specific circumstances, clarifying that general inquiries are not considered such a determination. Furthermore, the bill introduces the concept of a "disallowance period" for certain tax credits and ensures that supervisory approval is required even for those automatically calculated electronically. To enhance transparency, the Treasury Secretary will be required to publish an annual report detailing all penalties assessed by the IRS, including data on their progression and final outcomes across different organizational units.