[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 846 Introduced in Senate (IS)]







104th CONGRESS
  1st Session
                                 S. 846

 To amend the Internal Revenue Code of 1986 to allow a tax credit for 
    charitable contributions to certain private charities providing 
   assistance to the poor thereby improving Federal welfare efforts 
     through increased charitable activity, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                 May 23 (legislative day, May 15), 1995

 Mr. Ashcroft (for himself, Mr. Coverdell, Mr. Craig, Mr. DeWine, Mr. 
 Smith, Mr. Inhofe, and Mr. Kempthorne) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to allow a tax credit for 
    charitable contributions to certain private charities providing 
   assistance to the poor thereby improving Federal welfare efforts 
     through increased charitable activity, and for other purposes.
    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Charitable Volunteers Tax Credit 
Incentive Act of 1995''.

SEC. 2. CREDIT FOR CHARITABLE CONTRIBUTIONS TO CERTAIN PRIVATE 
              CHARITIES PROVIDING ASSISTANCE TO THE POOR.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to nonrefundable 
personal credits) is amended by inserting after section 22 the 
following new section:

``SEC. 23. CREDIT FOR CERTAIN CHARITABLE CONTRIBUTIONS.

    ``(a) In General.--In the case of an eligible taxpayer, there shall 
be allowed as a credit against the tax imposed by this chapter for the 
taxable year an amount equal to so much of the qualified charitable 
contributions which are paid by the taxpayer to 1 qualified charity as 
do not exceed $500.
    ``(b) Eligible Taxpayer.--For purposes of this section, the term 
`eligible taxpayer' means any individual who has worked at least 50 
hours at the qualified charity identified under subsection (c) during 
the taxable year.
    ``(c) Qualified Charitable Contribution.--For the purposes of this 
section, the term `qualified charitable contribution' means any 
charitable contribution (as defined in section 170(c)) made in cash, 
but only if the amount of such contribution, the qualified charity, and 
the number of hours worked by the taxpayer at the qualified charity are 
identified on the return for the taxable year during which such 
contribution is made.
    ``(d) Qualified Charity.--
            ``(1) In general.--For purposes of this section, the term 
        `qualified charity' means, with respect to the taxpayer, any 
        organization described in section 501(c)(3) and exempt from tax 
        under section 501(a)--
                    ``(A) which is certified by the Secretary as 
                meeting the requirements of paragraphs (2) and (3); and
                    ``(B) which is organized under the laws of a State 
                at the time the contribution is made and is exempt from 
                income taxation (if any) by such State.
            ``(2) Charity must primarily assist the poor.--An 
        organization meets the requirements of this paragraph only if 
        the predominant activity of such organization is the provision 
        of services to individuals whose annual incomes do not exceed 
        150 percent of the official poverty line (as defined by the 
        Office of Management and Budget).
            ``(3) Minimum expenditure requirement.--
                    ``(A) In general.--An organization meets the 
                requirements of this paragraph only if the Secretary 
                reasonably expects that the annual exempt purpose 
                expenditures of such organization will not be less than 
                70 percent of the annual aggregate expenditures of such 
                organization.
                    ``(B) Exempt purpose expenditure.--For purposes of 
                subparagraph A--
                            ``(i) In general.--The term `exempt purpose 
                        expenditure' means any expenditure to carry out 
                        the activity referred to in paragraph (2).
                            ``(ii) Exceptions.--Such term shall not 
                        include--
                                    ``(I) any administrative expense;
                                    ``(II) any expenses for the purpose 
                                of influencing legislation (as defined 
                                in section 4911(d));
                                    ``(III) any expense primarily for 
                                the purpose of fundraising; and
                                    ``(IV) any expense for a legal 
                                service provided on behalf of any 
                                individual referred to in paragraph 
                                (2).
    ``(e) Donor May Not Have Financial Interest in Charity.--
            ``(1) In general.--No credit shall be allowed under this 
        section for any contribution made to an organization if the 
        donor or any member of the donor's family is an officer or 
        employee of such organization.
            ``(2) Self-dealing.--To the extent provided by the 
        Secretary by regulation, no credit shall be allowed under this 
        section for any contribution made to an organization if--
                    ``(A) the donor,
                    ``(B) any member of the family of the donor, or
                    ``(C) any thirty-five percent controlled entity of 
                persons described in subparagraph (A) or (B), engages 
                in significant activities with respect to such 
                organization which are a type described in section 
                4941(d) (relating to self-dealing).
            ``(3) 35-percent controlled entity.--
                    ``(A) In general.--For purposes of paragraph (2), 
                the term `35-percent controlled entity' means--
                            ``(i) a corporation in which persons 
                        described in subparagraph (A) or (B) of 
                        paragraph (2) own more than 35 percent of the 
                        combined voting power,
                            ``(ii) a partnership in which such persons 
                        own more than 35 percent of the profits 
                        interest, and
                            ``(iii) a trust or estate in which such 
                        persons own more than 35 percent of the 
                        beneficial interest.
                    ``(B) Constructive ownership rules.--Rules similar 
                to the rules of paragraphs (3) and (4) of section 
                4946(a) shall apply for purposes of this paragraph.
            ``(4) Member of the family.--For the purposes of this 
        subsection, the members of an individual's family shall be 
        determined under section 4946(d).
    ``(f) Coordination With Deduction for Charitable Contributions.--
            ``(1) Credit in lieu of deductions.--The credit provided by 
        subsection (a) for any qualified charitable deduction shall be 
        in lieu of any deduction otherwise allowable under this chapter 
        for such contribution.
            ``(2) Election to have this section not apply.--A taxpayer 
        may elect for any taxable year to have this section not 
        apply.''.
    (b) Qualified Charities Required To Provide Copies of Annual 
Return.--Subsection (e) of section 6104 of such code (relating to 
public inspection of certain annual returns and applications for 
exemption) is amended by adding at the end the following new paragraph:
            ``(3) Charities receiving creditable contributions required 
        to provide copies of annual return.--
                    ``(A) In general.--Every qualified charity (as 
                defined in section 23(d)) shall, upon request of an 
                individual made at an office where such organization's 
                annual return filed under section 6033 is required 
                under paragraph (1) to be available for inspection, 
                shall provide a copy of such return to such individual 
                without charge other than a reasonable fee for any 
                reproduction and mailing costs. If the request is made 
                in person, such copies shall be provided immediately 
                and, if made other than in person, shall be provided 
                within 30 days.
                    ``(B) Period of availability.--Subparagraph (A) 
                shall only apply during the 3-year period beginning on 
                the filing date (as defined in paragraph (1)(D) of the 
                return requested).''.
    (c) Clerical Amendment.--The table of sections for subpart A of 
part IV of subchapter A of chapter of such Code is amended by inserting 
after the item relating to section 22 the following new item:

``Sec. 23. Credit for certain charitable contributions.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to contributions made and work performed after the 90th day after 
the date of the enactment of this Act, in taxable years ending after 
such date.
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