[Congressional Record Volume 155, Number 12 (Wednesday, January 21, 2009)]
[Senate]
[Pages S720-S721]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. FEINGOLD:
  S. 285. 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 reintroduce legislation 
today that would 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 organization 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, for 
2009, the mileage reimbursement level permitted for businesses is 55 
cents per mile, nearly four times the volunteer rate.
  During this economic downturn we are asking volunteers and volunteer 
organizations to bear a greater burden of delivering essential 
services, but the 14 cents per mile limit is imposing a very real 
hardship for charitable organizations and other nonprofit groups. This 
was an even harsher constraint on volunteer activity when gasoline 
prices spiked last summer.
  I have heard from a number of people in Wisconsin on the need to 
increase this reimbursement limit. One of the first organizations that 
brought this issue to my attention was the Portage County Department on 
Aging. Volunteer drivers are critical to their ability to provide 
services to seniors in Portage County, and the Department on Aging 
depends on dozens of volunteer drivers to deliver meals to homes and 
transport people to their medical appointments, meal sites, and other 
essential services.
  As many of my colleagues know, nutrition 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. As I discovered during my ten 
years as Chair of the Wisconsin State Senate Committee on Aging, the 
senior nutrition programs not only provide needed nutrition services, 
but in many cases, the congregate meals program provides an important 
community contact point for seniors who may live alone, and the meals 
program may be the point at which many frail elderly first come into 
contact with the network of services that can help them. For that 
reason, the senior nutrition programs are often at the heart of the 
aging services network, and as such are essential for many critical 
services that frail elderly may need.
  Unfortunately, Federal support for the senior nutrition programs has 
stagnated in recent years, increasing pressure on local programs to 
leverage more volunteer services to make up for that lagging Federal 
support. The 14 cents per mile reimbursement limit has made it far more 
difficult to obtain those volunteer services. Portage County reported 
that at 14 cents per mile, many of their volunteers cannot afford to 
offer their services.
  If volunteer drivers cannot be found, either those services will be 
lost, and those most vulnerable in our society will go wanting, or the 
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. 
The same is true for thousands of other nonprofit and charitable 
organizations that provide essential services to communities across our 
Nation.
  By contrast, businesses do not face this restrictive mileage 
reimbursement limit. As I noted earlier, for 2009 the comparable 
mileage rate for someone who works for a business is 55 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

[[Page S721]]

nearly four times the amount permitted the volunteer without a tax 
consequence.
  This doesn't make sense. The 14 cents per mile volunteer 
reimbursement limit is badly 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 14 cents 
per mile, as part of the Taxpayer Relief Act of 1997.
  The bill I am introducing today is identical to a measure I 
introduced in the 109th Congress and the 110th Congress, and largely 
the same as the version I introduced in the 107th and 108th Congresses. 
It raises the limit on volunteer mileage reimbursement to the level 
permitted to businesses, and provides an offset to ensure that the 
measure does not aggravate the budget deficit. The most recent estimate 
of the cost to increase the reimbursement for volunteer drivers is 
about $1 million over 5 years. Though the revenue loss is small, it is 
vital that we do everything we can to move toward a balanced budget, 
and to that end I have included a provision to fully offset the cost of 
the measure and make it deficit neutral. That provision increases the 
criminal monetary penalties for individuals and corporations convicted 
of tax fraud. The provision passed the Senate in the 108th Congress as 
part of the JOBS bill, but was later dropped in conference and was not 
included in the final version of that bill.
  I also extend my thanks to the senior Senator from New York, Mr. 
Schumer, for including my bill in his larger omnibus volunteer driver 
relief measure, the GIVE Act, last year, and the junior Senator from 
Maryland, Mr. Cardin, for including my bill in this year's version of 
the GIVE Act. Both Senators are keenly aware of the need for the change 
provided by this bill, and I thank them for their leadership on this 
issue.
  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 nonprofit groups and the volunteers 
themselves.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record immediately following my remarks.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 285

       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 139B the following new section:

     ``SEC. 139C. 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 the Internal Revenue Code of 
     1986 is amended by inserting after the item relating to 
     section 139B and inserting the following new item:

``Sec. 139C. 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. INCREASE IN CRIMINAL MONETARY PENALTY LIMITATION FOR 
                   THE UNDERPAYMENT OR OVERPAYMENT OF TAX DUE TO 
                   FRAUD.

       (a) In General.--Section 7206 of the Internal Revenue Code 
     of 1986 (relating to fraud and false statements) is amended--
       (1) by striking ``Any person who--'' and inserting ``(a) In 
     General.--Any person who--'', and
       (2) by adding at the end the following new subsection:
       ``(b) Increase in Monetary Limitation for Underpayment or 
     Overpayment of Tax Due to Fraud.--If any portion of any 
     underpayment (as defined in section 6664(a)) or overpayment 
     (as defined in section 6401(a)) of tax required to be shown 
     on a return is attributable to fraudulent action described in 
     subsection (a), the applicable dollar amount under subsection 
     (a) shall in no event be less than an amount equal to such 
     portion. A rule similar to the rule under section 6663(b) 
     shall apply for purposes of determining the portion so 
     attributable.''.
       (b) Increase in Penalties.--
       (1) Attempt to evade or defeat tax.--Section 7201 of the 
     Internal Revenue Code of 1986 is amended--
       (A) by striking ``$100,000'' and inserting ``$250,000'',
       (B) by striking ``$500,000'' and inserting ``$1,000,000'', 
     and
       (C) by striking ``5 years'' and inserting ``10 years''.
       (2) Willful failure to file return, supply information, or 
     pay tax.--Section 7203 of such Code is amended--
       (A) in the first sentence--
       (i) by striking ``misdemeanor'' and inserting ``felony'', 
     and
       (ii) by striking ``1 year'' and inserting ``10 years'', and
       (B) by striking the third sentence.
       (3) Fraud and false statements.--Section 7206(a) of such 
     Code (as redesignated by subsection (a)) is amended--
       (A) by striking ``$100,000'' and inserting ``$250,000'',
       (B) by striking ``$500,000'' and inserting ``$1,000,000'', 
     and
       (C) by striking ``3 years'' and inserting ``5 years''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to underpayments and overpayments attributable to 
     actions occurring after the date of the enactment of this 
     Act.
                                 ______