[Congressional Record Volume 161, Number 54 (Wednesday, April 15, 2015)]
[House]
[Pages H2240-H2241]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    FAIR TREATMENT FOR ALL GIFTS ACT

  Mr. RYAN of Wisconsin. Mr. Speaker, I move to suspend the rules and 
pass the bill (H.R. 1104) to amend the Internal Revenue Code of 1986 to 
provide a deduction from the gift tax for gifts made to certain exempt 
organizations, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 1104

       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 ``Fair Treatment for All Gifts 
     Act''.

     SEC. 2. DEDUCTION FROM GIFT TAX FOR GIFTS MADE TO CERTAIN 
                   EXEMPT ORGANIZATIONS.

       (a) In General.--Section 2522(a) of the Internal Revenue 
     Code of 1986 is amended by striking the period at the end of 
     paragraph (4) and inserting a semicolon and by inserting 
     after paragraph (4) the following new paragraph:
       ``(5) an organization described in paragraph (4), (5), or 
     (6) of section 501(c) and exempt from tax under section 
     501(a).''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall apply to gifts made after the date of the enactment of 
     this Act.
       (c) No Inference.--Nothing in the amendments made by 
     subsection (a) shall be construed to create any inference 
     with respect to whether any transfer of property (whether 
     made before, on, or after the date of the enactment of this 
     Act) to an organization described in paragraph (4), (5), or 
     (6) of section 501(c) of the Internal Revenue Code of 1986 is 
     a transfer of property by gift for purposes of chapter 12 of 
     such Code.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Wisconsin (Mr. Ryan) and the gentleman from Georgia (Mr. Lewis) each 
will control 20 minutes.
  The Chair recognizes the gentleman from Wisconsin.


                             General Leave

  Mr. RYAN of Wisconsin. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days within which to revise and extend 
their remarks and include extraneous material on H.R. 1104, currently 
under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Wisconsin?
  There was no objection.
  Mr. RYAN of Wisconsin. Mr. Speaker, I yield such time as he may 
consume to the gentleman from Illinois (Mr. Roskam), the chairman of 
the Oversight Subcommittee and the author of this bill for the purpose 
of describing his bill.
  Mr. ROSKAM. Mr. Speaker, I have a riddle for you:
  What is it that brings together the American Civil Liberties Union, 
Americans for Prosperity, the Human Rights Campaign, and the Tea Party 
Patriots all under one tent? Mr. Speaker, it is the Fair Treatment for 
All Gifts Act, H.R. 1104.
  Here is the point. This is why all these groups from a wide range of 
political perspectives have all come together. They have come together 
because the IRS has started sniffing around about the possibility of 
doing something that every one of those groups really finds jarring, 
and that is assessing a tax liability on gifts to nonprofit 
organizations.
  Now, you would have thought that this would be pretty settled 
doctrine, that gifts to nonprofit organizations, those types of 
contributions, are not taxable events. Yet the Internal Revenue Service 
wrote a letter. It is this type of letter. It is the kind of letter 
that I described in an earlier bill. You get it, and it is very 
unsettling, Mr. Speaker. They just wrote some donor, and they said, 
Your gift tax return was assigned to me for examination. The IRS has 
received information that you donated cash to some organization, and it 
begins to lay out a theory as to why this should be a taxable event.
  Mr. Speaker, this should not be a taxable event. Mr. Speaker, this 
should not be ambiguous. And, Mr. Speaker, the Internal Revenue Service 
should not be wasting its precious time, which it seems to have so 
little of; shouldn't be going after American donors to all kinds of 
groups--left, right, center, up, down, any which way--and giving them a 
hard time about the contributions that they are making.
  One final point. We have got a system, Mr. Speaker, that depends on 
the generosity of Americans. The American public is an incredibly 
generous group. The American public is sacrificial in their giving in 
many ways, and the donations and the generosity of the American public 
is absolutely foundational for our civic life. So, Mr. Speaker, H.R. 
1104 clarifies that, and it says donations to those tax-exempt 
organizations under 501(c)(4), (5), and (6) of the Tax Code are not 
taxable.
  Mr. LEWIS. Mr. Speaker, I yield myself as much time as I may consume.
  Mr. Speaker, I rise in support of H.R. 1104. On this day, it is wise 
for the House to consider a bill to increase certainty for taxpayers. 
This bill brings clarity to what has historically been uncertain tax 
treatment for contributions to social welfare organizations, 
agricultural associations, labor unions, and trade associations.
  With this bill, Mr. Speaker, amounts contributed to such 
organizations will not be subject to the gift tax.
  Mr. Speaker, I urge all of my colleagues on both sides of the aisle 
to vote ``yes'' for H.R. 1104.
  Mr. Speaker, I thank my colleagues, the chairman, the chairs of the 
subcommittee, and all of the members of the committee for supporting 
this piece of legislation and the other pieces.
  I reserve the balance of my time.
  Mr. RYAN of Wisconsin. Mr. Speaker, I yield myself such time as I may 
consume.
  Are you getting a theme here, Mr. Speaker? So what has happened here 
is individuals were giving donations to tax-exempt organizations, 
nonprofit organizations. As they should have, they did not expect to 
have to pay taxes on those donations. The Internal Revenue Service sent 
these letters to these donors, to these particular organizations, 
obviously stirring up a lot of confusion and threatening them with a 
big tax bill.
  This makes it really clear. These organizations are tax-exempt 
organizations, and therefore you don't owe gift taxes for a donation to 
these organizations. It is crystal clear. It is made even more clear in 
this bill because, Mr. Speaker, it is very important for the operation 
of our society that that space that occurs between ourselves and our 
government is full, is vibrant, and is alive.
  We call that space civil society. It is where we live our lives. The 
deeply woven fabric of civil society are all these various groups, 
nonprofit groups, all kinds of groups, advocating for something--
advocating for the environment, advocating for the economy, advocating 
for the disabled, advocating for this cause, advocating for that cause, 
advocating for this person, and advocating for that person. It is how 
we lead our lives. It is how we integrate with one another. It is how 
we have a community.
  So, Mr. Speaker, the last thing we want to do is have the IRS 
parachute itself in and divide itself and make people think that they 
can't participate in civil society. Civil society is so core to who we 
are as Americans and so core to our ability to live our freedoms and to 
help others. That is what is so important about this.
  So when people are hit with an intimidating letter from the Internal 
Revenue Service and are being told that by participating in civil 
society, by participating in civil dialogue, and by exercising their 
free speech rights they are going to get hit with this huge, massive 
tax bill that they didn't expect, that is harassment. That is 
targeting. That is not going to happen once this bill passes. That is 
one other mistake that was made that is being rectified because of Mr. 
Roskam's diligence.
  Mr. Speaker, I want to congratulate all the members of the committee 
who

[[Page H2241]]

on a bipartisan basis saw that this was wrong and on a bipartisan basis 
agreed with this solution. That is why I am just so pleased that we are 
bringing these bills to the floor. John Lewis, Sandy Levin, Peter 
Roskam, and Paul Ryan are arm in arm agreeing on this. We are standing 
up for citizens, we are standing up for taxpayers, we are putting the 
taxpayer in charge of the IRS, not the other way around, and we are 
standing up for our free speech rights for our civil society. That is 
why on this tax day, April 15, we are bringing these bills to the floor 
and passing these bills on a bipartisan, unanimous basis because this 
is the signal we want to send to Americans on tax day that we are not 
going to take this anymore, and we are going to reassert our rights.
  With that, Mr. Speaker, I yield the balance of my time to the 
gentleman from Illinois (Mr. Roskam) for closing on his bill.
  Mr. ROSKAM. Thank you, Chairman.
  Mr. Speaker, I want to make one other point to echo something 
Chairman Ryan said as it relates to civil society, and it is an 
important thing to think about.

  There is the Federal Government here, and there is the individual 
here. The only thing that sort of comes in between as a buffer--there 
are a couple of things. One is family. I think that is a very important 
buffer. The other buffer is civil society. It is a restraining 
influence, the capability of individual, family, and civil society to 
push back.
  So we are on the floor today, and we have been interacting with John 
Lewis, our friend from Georgia, who has a reputation that is 
unbelievable, and it is an honor and a privilege to serve with him. 
Why? Because of the work that he did in the civil rights movement. It 
is an inspiration.
  But can you imagine what it would have been like if a bureaucrat at 
the time had said, Well, I am just going to send one of these kind of 
letters to the donors of the NAACP or any of these organizations? Can 
you imagine what happens?
  Here is my second point. A letter like this? What does it do? It has 
a chilling effect, doesn't it? All of a sudden you have donors who say, 
I don't know, I don't know. This is going to be a taxable event. Well, 
maybe I am not going to give. Or I am going to end up on some list, I 
don't know. Or I am going to find my name in the paper in this way, and 
I don't want my name in the paper. Whatever it happens to be. But the 
impact and the damage, Mr. Speaker, is the same. It has a chilling 
effect, doesn't it?
  Here is the final point. The IRS backed off really fast on this once 
we asked about it. This wasn't a situation where they doubled down, 
they said, Oh, no, no, no, the statute that you all passed absolutely 
gives us this authority. They backed off, and they said, No, we are not 
going to do that anymore. That tells you something too, doesn't it? It 
tells you that the ground upon which they thought they were operating 
was pretty soft ground.
  So let me just conclude by saying this. Today, the nature of this 
debate, the intensity that you have heard from both sides of the aisle, 
the Members are reflecting not ourselves and just our world view, Mr. 
Speaker, but we are reflecting what we are hearing at home, and we are 
reflecting the desire of the American public who want to have 
confidence in these institutions. They want to know that the tax-
collecting body of the United States that is the Internal Revenue 
Service is just going to collect the taxes and is not going to mess 
with them and is not going to put them through all kinds of paces and 
manipulate them and make their lives miserable and actually abuse 
power. That is all they want. Isn't that a very real expectation? It is 
not asking too much.
  So my suspicion is that the debate today--and it is my hope that the 
other body will pick up these bills and move forward on them, recognize 
the bipartisan nature of them and recognize the timeliness and the 
ripeness of them. These need to be fixed. These problems need to be 
fixed now. There is an urgency to them. But this is not a false claim 
that this work is completed. In fact, this is going to be a work in 
process, because it is our responsibility to get an Internal Revenue 
Service that moves away from the disposition and the attitude of 
impunity--which is saturated up until now--back to where it should be. 
I think we can do it. I am confident with the bipartisan support in 
this House we can reflect back and say April 15 of this year, this was 
a good day.
  Mr. LEWIS. Mr. Speaker, before I yield the balance of my time back, 
it has been an honor and a pleasure to work with the chairman, the 
chairman of the subcommittee, and all of the Members on the other side. 
We did come together in a bipartisan fashion.
  In a real sense, we all live in the same house--the American house--
and we must continue to look out for this house, not just this 
building, but the more than 300 million people in our country. That is 
the right thing to do. That is the fair thing to do. That is the just 
thing to do.
  Mr. Speaker, I yield back the balance of my time.
  Mr. RYAN of Wisconsin. Mr. Speaker, I can't top that, so I yield back 
the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Wisconsin (Mr. Ryan) that the House suspend the rules 
and pass the bill, H.R. 1104, as amended.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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