[Congressional Record Volume 148, Number 99 (Friday, July 19, 2002)]
[Senate]
[Pages S7106-S7107]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. FEINGOLD:
  S. 2761. A bill to amend the Internal Revenue Code of 1986 to provide 
that reimbursements for costs of using passenger automobiles for 
charitable and other organizations are excluded from gross income, and 
for other purposes; to the Committee on Finance.
  Mr. FEINGOLD. Mr. President, I am pleased to offer legislation today 
that will increase the mileage reimbursement rate for volunteers.
  Under current law, when volunteers use their cars for charitable 
purposes, the volunteers may be reimbursed up to 14 cents per mile for 
their donated services without triggering a tax consequence for either 
the organizations or the volunteers. If the charitable organization 
reimburses any more than that, they are required to file an information 
return indicating the amount, and the volunteers must include the 
amount over 14 cents per mile in their taxable income. By contrast, the 
mileage reimbursement level currently permitted for businesses is 36.5 
cents per mile.
  At a time when government is asking volunteers and volunteer 
organizations to bear a greater burden of delivering essential 
services, the 14 cents per mile limit is posing a very real hardship.
  I have heard from a number of groups in Wisconsin in recent weeks on 
the need to increase this reimbursement limit. One organization, the 
Portage County Department on Aging, explained just how important 
volunteer drivers are to their ability to provide services to seniors 
in that county. The Department on Aging reported that last year 54 
volunteer drivers delivered meals to homes and transported people to 
medical appointments, meal sites, and other essential services. The 
Department noted that their volunteer drivers provided 4,676 rides, and 
drove nearly 126,000 miles. They also delivered 9,385 home-delivered 
meals, and nearly two-thirds of the drivers logged more than 100 miles 
per month in providing these needed services. Altogether, volunteers 
donated over 5,200 hours last year, and as the Department notes, at the 
rate of minimum wage, that amounts to over $27,000, not including other 
benefits.
  The senior meals program is one of the most vital services provided 
under the Older Americans Act, and ensuring that meals can be delivered 
to seniors or that seniors can be taken to meal sites is an essential 
part of that program. Unfortunately, Federal support for the senior 
nutrition programs has stagnated in recent years. This has increased 
pressure on local programs to leverage more volunteer services to make 
up for lagging federal support. The 14 cent per mile reimbursement 
limit, though, increasingly poses a barrier to obtaining those 
contributions. Portage County reports that the many of their volunteers 
cannot afford to offer their services under such a restriction. And if 
volunteers cannot be found, their services will have to be replaced by 
contracting with a provider, greatly increasing costs to the 
Department, costs that come directly out of the pot of funds available 
to pay for meals and other services.
  By contrast, businesses do not face this restrictive mileage 
reimbursement limit. The comparable mileage rate for someone who works 
for a business is currently 36.5 cents per mile. This disparity means 
that a business hired to deliver the same meals delivered by volunteers 
for Portage County may reimburse their employees over double the amount 
permitted the volunteer without a tax consequence.
  This doesn't make sense.
  Morever, the 14 cent per mile volunteer reimbursement limit is 
outdated. According to the Congressional Research Service, Congress 
first set a reimbursement rate of 12 cents per mile as part of the 
Deficit Reduction Act of 1984, and did not increase it until 1997, when 
the level was raised slightly, to

[[Page S7107]]

14 cents per mile, as part of the Taxpayer Relief Act of 1997.
  The bill I am introducing today raises the limit on volunteer mileage 
reimbursement to the level permitted to businesses. It is essentially 
the same provision passed by the Senate as part of a tax bill passed in 
1999 that was vetoed by President Clinton. At the time of the 1999 
measure, the Joint Committee on Taxation, JCT, estimated that the 
mileage reimbursement provision would result in the loss of $1 million 
over the five year fiscal period from 1999 to 2004. The revenue loss 
was so small that the JCT did not make the estimate on a year by year 
basis.
  Though the revenue loss is small, I have also included an offset to 
make the measure deficit neutral by including a provision that would 
impose a civil penalty of up to $5,000 on failure to report interest in 
foreign financial transactions. That provision was recently included in 
the CARE Act legislation by the Senate Finance Committee.
  I urge my colleagues to support this measure. It will help ensure 
charitable organizations can continue to attract the volunteers that 
play such a critical role in helping to deliver services and it will 
simplify the tax code both for non-profit groups and the volunteers 
themselves.
  I ask unanimous consent that the text of the legislation be printed 
in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2761

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

     SECTION 1. MILEAGE REIMBURSEMENTS TO CHARITABLE VOLUNTEERS 
                   EXCLUDED FROM GROSS INCOME.

       (a) In General.--Part III of subchapter B of chapter 1 of 
     the Internal Revenue Code of 1986 is amended by inserting 
     after section 139 the following new section:

     ``SEC. 139A. MILEAGE REIMBURSEMENTS TO CHARITABLE VOLUNTEERS.

       ``(a) In General.--Gross income of an individual does not 
     include amounts received, from an organization described in 
     section 170(c), as reimbursement of operating expenses with 
     respect to use of a passenger automobile for the benefit of 
     such organization. The preceding sentence shall apply only to 
     the extent that such reimbursement would be deductible under 
     this chapter if section 274(d) were applied--
       ``(1) by using the standard business mileage rate 
     established under such section, and
       ``(2) as if the individual were an employee of an 
     organization not described in section 170(c).
       ``(b) No Double Benefit.--Subsection (a) shall not apply 
     with respect to any expenses if the individual claims a 
     deduction or credit for such expenses under any other 
     provision of this title.
       ``(c) Exemption From Reporting Requirements.--Section 6041 
     shall not apply with respect to reimbursements excluded from 
     income under subsection (a).''
       (b) Clerical Amendment.--The table of sections for part III 
     of subchapter B of chapter 1 of such Code is amended by 
     inserting after the item relating to section 139 and 
     inserting the following new item:

``Sec. 139A. Reimbursement for use of passenger automobile for 
              charity.''.

       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after the date of the 
     enactment of this Act.

     SEC. 2. PENALTY ON FAILURE TO REPORT INTERESTS IN FOREIGN 
                   FINANCIAL ACCOUNTS.

       (a) In General.--Section 5321(a)(5) of title 31, United 
     States Code, is amended to read as follows:
       ``(5) Foreign financial agency transaction violation.--
       ``(A) Penalty authorized.--The Secretary of the Treasury 
     may impose a civil money penalty on any person who violates, 
     or causes any violation of, any provision of section 5314.
       ``(B) Amount of penalty.--
       ``(i) In general.--Except as provided in subparagraph (C), 
     the amount of any civil penalty imposed under subparagraph 
     (A) shall not exceed $5,000.
       ``(ii) Reasonable cause exception.--No penalty shall be 
     imposed under subparagraph (A) with respect to any violation 
     if--

       ``(I) such violation was due to reasonable cause, and
       ``(II) the amount of the transaction or the balance in the 
     account at the time of the transaction was properly reported.

       ``(C) Willful violations.--In the case of any person 
     willfully violating, or willfully causing any violation of, 
     any provision of section 5314--
       ``(i) the maximum penalty under subparagraph (B)(i) shall 
     be increased to the greater of--

       ``(I) $25,000, or
       ``(II) the amount (not exceeding $100,000) determined under 
     subparagraph (D), and

       ``(ii) subparagraph (B)(ii) shall not apply.
       ``(D) Amount.--The amount determined under this 
     subparagraph is--
       ``(i) in the case of a violation involving a transaction, 
     the amount of the transaction, or
       ``(ii) in the case of a violation involving a failure to 
     report the existence of an account or any identifying 
     information required to be provided with respect to an 
     account, the balance in the account at the time of the 
     violation.''
       (b) Effective Date.--The amendment made by this section 
     shall apply to violations occurring after the date of the 
     enactment of this Act.
                                 ______