[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 3453 Introduced in Senate (IS)]

111th CONGRESS
  2d Session
                                S. 3453

 To provide an exception from the payout requirements established for 
   certain section 501(c)(3) type III supporting organizations under 
         section 1241(d) of the Pension Protection Act of 2006.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                 May 28 (legislative day, May 26), 2010

  Mr. Nelson of Florida (for himself, Mr. Carper, and Mr. Chambliss) 
introduced the following bill; which was read twice and referred to the 
          Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL


 
 To provide an exception from the payout requirements established for 
   certain section 501(c)(3) type III supporting organizations under 
         section 1241(d) of the Pension Protection Act of 2006.

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

SECTION 1. EXCEPTION FROM PAYOUT REQUIREMENTS FOR TYPE III SUPPORTING 
              ORGANIZATIONS.

    (a) In General.--Section 1241(d) of the Pension Protection Act of 
2006 (26 U.S.C. 509 note) is amended by redesignating paragraph (2) as 
paragraph (3) and by inserting after paragraph (1) the following new 
paragraph:
            ``(2) Exception for certain existing organizations.--
                    ``(A) In general.--The regulations under paragraph 
                (1) shall not apply to any type III supporting 
                organization described in subparagraph (B).
                    ``(B) Application.--A type III supporting 
                organization is described in this subparagraph if--
                            ``(i) the organization was classified as an 
                        organization described in section 509(a)(3) of 
                        the Internal Revenue Code of 1986 before August 
                        17, 2006,
                            ``(ii) no substantial contributor (within 
                        the meaning of section 4958(c)(3)(C) of such 
                        Code) to the organization was alive on August 
                        17, 2006,
                            ``(iii) no family member (within the 
                        meaning of section 4958(f)(4) of such Code) of 
                        any substantial contributor is an organization 
                        manager (as defined in section 4958(f)(2) of 
                        such Code) with respect to the organization or 
                        is a borrower or lessee of property from the 
                        organization, and
                            ``(iv) either--
                                    ``(I) the organization has not 
                                accepted any contribution from a 
                                substantial contributor after December 
                                31, 1970, other than by operation of 
                                the creator's will or other gift 
                                instrument that was executed before 
                                December 31, 1970, or
                                    ``(II) the organization normally 
                                distributes each year for its exempt 
                                purposes an amount not less than 85 
                                percent of the organization's adjusted 
                                net income (as defined in section 
                                4942(f) of such Code) for the 
                                immediately preceding year and holds 30 
                                percent or more of the reasonably 
                                estimated value of its total assets, 
                                other than assets used or held for use 
                                directly in carrying out one or more 
                                purposes described in section 
                                170(c)(2)(B), in the form of assets for 
                                which market quotations are not readily 
                                available but which normally produce 
                                gross investment income (as defined in 
                                section 4940(c)(2) of such Code).''.
    (b) Conforming Amendment.--Section 1241(d)(3) of such Act, as 
redesignated by subsection (a), is amended by striking ``paragraph 
(1)'' and inserting ``this subsection''.
    (c) Effective Date.--The amendments made by this section shall take 
effect as if included in the provisions of the Pension Protection Act 
of 2006 to which such amendments relate.
                                 <all>