[Congressional Record Volume 152, Number 135 (Friday, December 8, 2006)]
[Senate]
[Page S11742]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. FEINSTEIN (for herself, Mrs. Boxer, and Mr. Craig):
  S. 4112. A bill to treat payments by charitable organizations with 
respect to certain firefighters as exempt payments; to the Committee on 
Finance.
  Mrs. FEINSTEIN. Mr. President, I rise today to introduce legislation 
that will give tangible relief to the families of the five federal 
firefighters killed in the devastating Esperanza fire in southern 
California this October.
  The Esperanza fire tragically claimed lives, homes and other 
buildings, while burning more than 40,000 acres. No one has felt the 
pain of this heartbreaking disaster more than the families of Mark 
``Lotzie'' Loutzenhiser, Jess McLean, Jason McKay, Daniel Hoover-
Najera, and Pablo Cerda.
  These five men served honorably while exhibiting the utmost bravery 
in the name of helping others. They gave the ultimate sacrifice, and so 
have their families, who must now go on without a father or a son, a 
brother or a husband.
  Now, in an outpouring of generosity and compassion, a United Way 
chapter in Riverside County, together with the surrounding community 
has raised more than $1 million to help the families of our fallen 
heroes as they move forward from this tragedy.
  This serves as a testament to what these men meant to the community, 
the State of California and the Nation.
  Unfortunately, in what seems to be a cruel twist, IRS rules do not 
allow this generosity to be passed on to the families of these brave 
firefighters.
  Tax-exempt charitable organizations are prohibited from raising money 
for small, targeted, groups, such as the families of the fallen 
firefighters. In fact, if this memorial fund is passed on to the 
families, it could endanger the tax-exempt status of the Central County 
United Way and other charitable organizations trying to help these 
families in their hour of need.
  In the wake of this disaster, our Government should be providing 
assistance to these families, not increasing their burden.
  This much-needed legislation provides exemptions to allow this moving 
gesture to be realized. The United Way will preserve their tax exempt 
status, those who made these donations will receive the tax deductions 
they expected, and most importantly the families of the five fallen 
firefighters can receive individual donations, penalty free.
  This legislation encourages the kind of generosity and kindness that 
we should all commend, not discourage.
  We came together to pass similar legislation in the wake of the 9/11 
tragedy and we should do so again today.
  While this simple measure only makes a minor tax code clarification, 
the impact of this legislation will be profound for the families of 
these fallen heroes.
  Let us not forget the heroism of these men and the sacrifice of their 
families. The time to act is now, so that these funds raised will not 
be withheld during the upcoming holiday season, when this relief is 
most needed.
  I urge my colleagues to join me in doing what is right to help the 
families of those who have made the ultimate sacrifice to protect their 
communities.
  Mr. President, I ask unanimous consent that the text of the Bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 4112

       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 ``Fallen Firefighters 
     Assistance Tax Clarification Act of 2006''.

     SEC. 2. PAYMENTS BY CHARITABLE ORGANIZATIONS WITH RESPECT TO 
                   CERTAIN FIREFIGHTERS TREATED AS EXEMPT PAYMENTS 
                   AND EXCLUDED FROM GROSS INCOME OF THE 
                   RECIPIENTS.

       (a) In General.--For purposes of the Internal Revenue Code 
     of 1986--
       (1) payments made by an organization described in section 
     501(c)(3) of such Code by reason of the death, injury, 
     wounding, or illness of any firefighter incurred as the 
     result of the October 2006 Esperanza Incident fire in 
     southern California, and before June 1, 2007, shall be 
     treated as related to the purpose or function constituting 
     the basis for such organization's exemption under section 501 
     of such Code if such payments are made in good faith using a 
     reasonable and objective formula which is consistently 
     applied;
       (2) in the case of a private foundation (as defined in 
     section 509 of such Code), any payment described in paragraph 
     (1) shall not be treated as made to a disqualified person for 
     purposes of section 4941 of such Code; and
       (3) the receipt of any payment described in paragraphs (1) 
     or (2), or any payment from any Federal, State, or local 
     government, or agency or instrumentality thereof, by reason 
     of the death, injury, wounding, or illness of any firefighter 
     incurred as the result of the October 2006 Esperanza Incident 
     fire in southern California, shall not be treated as gross 
     income under such Code.
       (b) Effective Date.--This section shall apply to payments 
     made on or after October 26, 2006.
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