[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3583 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 3583

     To amend the Internal Revenue Code of 1986 to provide that no 
organization providing support to terrorists or terrorist organizations 
shall be qualified for exemption from tax under section 501(a) of such 
                                 Code.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           December 20, 2001

  Mr. Israel 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 provide that no 
organization providing support to terrorists or terrorist organizations 
shall be qualified for exemption from tax under section 501(a) of such 
                                 Code.

    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 ``Anti-Terrorism Charity Protection 
Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) There are 1,230,000 charities, social welfare 
        organizations, and religious congregations in the United 
        States.
            (2) Eighty-nine percent of Americans gave money to 
        charities in the United States during 2000.
            (3) The average contributing household gave $1,620 to 
        charities in 2000.
            (4) Under the Internal Revenue Code of 1986, taxpayers may 
        deduct their charitable contributions from their taxable 
        income.
            (5) The Federal tax exemption for charitable contributions 
        is an important incentive for people to give to charities.
            (6) Because of the tax benefits charities enjoy, the 
        Internal Revenue Code of 1986 provides that only certain 
        classes of organizations are eligible for any tax benefits.
            (7) The Internal Revenue Service carefully scrutinizes 
        those organizations that apply for tax-exempt status and 
        confers such status only upon those organizations it deems to 
        be in compliance with laws and regulations.
            (8) For many Americans, tax-exempt status confers a 
        nonlegal preferred status on organizations that qualify for it.
            (9) It is in the national security interest to keep funding 
        from terrorists and terrorist organizations.
            (10) Tax-exempt status should not be available to any 
        organization that supports terrorists or terrorist 
        organizations.

SEC. 3. PURPOSES.

    The purposes of this Act are--
            (1) to ensure that no organization that supports terrorists 
        or terrorism has access to tax-exempt status as provided for in 
        the Internal Revenue Code of 1986; and
            (2) to codify current Internal Revenue Service practices 
        that deny tax-exempt status to organizations that support 
        terrorists or terrorism.

SEC. 4. DENIAL OF TAX EXEMPTION FOR ORGANIZATIONS PROVIDING SUPPORT TO 
              TERRORISTS OR TERRORIST ORGANIZATIONS.

    (a) In General.--Section 501 of the Internal Revenue Code of 1986 
(relating to exemption from tax on corporations, certain trusts, etc.) 
is amended by redesignating subsection (p) as subsection (q) and by 
inserting after subsection (o) the following new subsection:
    ``(p) Denial of Tax Exemption to Organizations Providing Support 
for Terrorists.--
            ``(1) In general.--In the case of any organization 
        described in subsection (c), exemption from taxation under 
        subsection (a) shall be denied if any funds of such 
        organization are used to support, or any activities of the 
        organization consist of providing support to, terrorists or 
        terrorist organizations.
            ``(2) Terrorist or terrorist organization.--For purposes of 
        this subsection, the term `terrorist or terrorist organization' 
        means any individual or organization that carries out any 
        terroristic activity (as defined by section 692(c)(2)(A)).''.
    (b) Effective Date.--The amendment made by this section shall take 
effect on the date of the enactment of this Act.
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