[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4269 Introduced in House (IH)]

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115th CONGRESS
  1st Session
                                H. R. 4269

  To amend the Internal Revenue Code of 1986 to eliminate the school 
  voucher State tax credit loophole by limiting the double benefit of 
                       charitable contributions.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            November 7, 2017

Ms. Sewell of Alabama (for herself and Mr. Danny K. Davis of Illinois) 
 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 eliminate the school 
  voucher State tax credit loophole by limiting the double benefit of 
                       charitable contributions.

    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 ``Public Funds for Public Schools 
Act''.

SEC. 2. ELIMINATION OF SCHOOL VOUCHER STATE TAX CREDIT LOOPHOLE BY 
              LIMITING THE DOUBLE BENEFIT OF CHARITABLE CONTRIBUTIONS.

    (a) In General.--Section 170(f) of the Internal Revenue Code of 
1986 is amended by adding at the end the following new paragraph:
            ``(19) Limitation on double benefit in the case of state 
        school voucher tax benefits.--
                    ``(A) In general.--The amount of any charitable 
                contribution otherwise taken into account under this 
                section shall be reduced by any State school voucher 
                tax benefit with respect to such contribution.
                    ``(B) State school voucher tax benefit.--For 
                purposes of this paragraph, the term `State school 
                voucher tax benefit' means the aggregate amount of any 
                State income tax credits, and excess State income tax 
                deductions, provided to the taxpayer by a State for any 
                contribution to a specified school voucher 
                organization.
                    ``(C) Excess state income tax deductions.--For 
                purposes of this paragraph, the term `excess State 
                income tax deduction' means the product of--
                            ``(i) the highest rate of State income tax 
                        applicable to the taxpayer for the taxable 
                        year, multiplied by
                            ``(ii) the excess (if any) of--
                                    ``(I) the State income tax 
                                deduction provided to the taxpayer with 
                                respect to contributions by the 
                                taxpayer to specified school voucher 
                                organizations, over
                                    ``(II) the amount of such 
                                contributions.
                    ``(D) Specified school voucher organization.--For 
                purposes of this paragraph, the term `specified school 
                voucher organization' means any organization the 
                primary purpose of which is the provision of vouchers, 
                scholarships, or other funds, for the expenses of 
                students to attend elementary or secondary schools.
                    ``(E) Treatment of similar state benefits.--For 
                purposes of this paragraph, any State benefit which is 
                economically equivalent to a tax credit (including any 
                payment) shall be treated as a State income tax credit 
                for purposes of this paragraph and any State benefit 
                which is economically equivalent to a State income tax 
                deduction (including any exclusion from gross income) 
                shall be treated as a State income tax deduction for 
                purposes of this paragraph.
            ``(20) Special rule for contributions of built-in gain 
        property to specified school voucher organizations.--
                    ``(A) In general.--In the case of any contribution 
                by the taxpayer of built-in gain property to a 
                specified school voucher organization, such 
                contribution shall be treated for purposes of this 
                title as though such property were sold by the taxpayer 
                at its fair market value immediately before such 
                contribution and the amount of such fair market value 
                were contributed by the taxpayer as a cash contribution 
                to the specified school voucher organization.
                    ``(B) Definitions.--For purposes of this 
                paragraph--
                            ``(i) Built-in gain property.--The term 
                        `built-in gain property' means any property if, 
                        immediately before the contribution of such 
                        property, the fair market value of such 
                        property exceeds the adjusted basis of such 
                        property.
                            ``(ii) Specified school voucher 
                        organization.--The term `specified school 
                        voucher organization' has the meaning given 
                        such term in paragraph (19).''.
    (b) Effective Date.--The amendment made by this section shall apply 
to charitable contributions made in taxable years beginning after the 
date of the enactment of this Act.
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