[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 614 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 614

To amend the Internal Revenue Code of 1986 to clarify the treatment of 
certain amounts received by a cooperative telephone company indirectly 
                           from its members.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 26, 1993

 Mr. Kopetski (for himself, Mr. Grandy, Mr. Richardson, Ms. Long, and 
Mr. Slattery) introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to clarify the treatment of 
certain amounts received by a cooperative telephone company indirectly 
                           from its members.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. TREATMENT OF CERTAIN AMOUNTS RECEIVED BY A COOPERATIVE 
              TELEPHONE COMPANY.

    (a) In General.--Paragraph (12) of section 501(c) of the Internal 
Revenue Code of 1986 (relating to list of exempt organizations) is 
amended by adding at the end thereof the following new subparagraph:
                    ``(E) In the case of a mutual or cooperative 
                telephone company (hereafter in this subparagraph 
                referred to as the `cooperative'), 50 percent of the 
                income received or accrued directly or indirectly from 
                a nonmember telephone company for the performance of 
                communication services by the cooperative shall be 
                treated for purposes of subparagraph (A) as collected 
                from members of the cooperative for the sole purpose of 
                meeting the losses and expenses of the cooperative.''
    (b) Certain Billing And Collection Service Fees Not Taken Into 
Account.--Subparagraph (B) of section 501(c)(12) of such Code is 
amended by striking ``or'' at the end of clause (iii), by striking the 
period at the end of clause (iv) and inserting ``, or'', and by adding 
at the end thereof the following new clause:
                            ``(v) from billing and collection services 
                        performed for a nonmember telephone company.''.
    (c) Conforming Amendment.--Clause (i) of section 501(c)(12)(B) of 
such Code is amended by inserting before the comma at the end thereof 
``, other than income described in subparagraph (E)''.
    (d) Effective Date.--The amendments made by this section shall 
apply to amounts received or accrued after December 31, 1992.
    (e) No Inference as to Unrelated Business Income Treatment of 
Billing and Collection Service Fees.--Nothing in the amendments made by 
this section shall be construed to indicate the proper treatment of 
billing and collection service fees under part III of subchapter F of 
chapter 1 of the Internal Revenue Code of 1986 (relating to taxation of 
business income of certain exempt organizations).

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