House Report 113-496 - PERMANENT IRA CHARITABLE CONTRIBUTION ACT OF 2014

[House Report 113-496]
[From the U.S. Government Publishing Office]

113th Congress } { Report
2d Session } HOUSE OF REPRESENTATIVES { 113-496

=======================================================================

PERMANENT IRA CHARITABLE CONTRIBUTION ACT OF 2014

_______

June 26, 2014.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed

_______

Mr. Camp, from the Committee on Ways and Means, submitted the following

R E P O R T

together with

DISSENTING VIEWS

[To accompany H.R. 4619]

[Including cost estimate of the Congressional Budget Office]

The Committee on Ways and Means, to whom was referred the
bill (H.R. 4619) to amend the Internal Revenue Code of 1986 to
make permanent the rule allowing certain tax-free distributions
from individual retirement accounts for charitable purposes,
having considered the same, report favorably thereon with an
amendment and recommend that the bill as amended do pass.

CONTENTS

Page
I. SUMMARY AND BACKGROUND...........................................2
A. Purpose and Summary................................. 2
B. Background and Need for Legislation................. 2
C. Legislative History................................. 2
II. EXPLANATION OF THE BILL..........................................3
A. Tax-Free Distributions from Individual Retirement
Plans for Charitable Purposes (sec. 408(d)(8) of
the Code).......................................... 3
III. VOTES OF THE COMMITTEE...........................................7
IV. BUDGET EFFECTS OF THE BILL.......................................7
A. Committee Estimate of Budgetary Effects............. 7
B. Statement Regarding New Budget Authority and Tax
Expenditures Budget Authority...................... 8
C. Cost Estimate Prepared by the Congressional Budget
Office............................................. 8
D. Macroeconomic Impact Analysis....................... 9
V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE.......9
A. Committee Oversight Findings and Recommendations.... 9
B. Statement of General Performance Goals and
Objectives......................................... 9
C. Information Relating to Unfunded Mandates........... 10
D. Applicability of House Rule XXI 5(b)................ 10
E. Tax Complexity Analysis............................. 10
F. Congressional Earmarks, Limited Tax Benefits, and
Limited Tariff Benefits............................ 10
G. Duplication of Federal Programs..................... 10
H. Disclosure of Directed Rule Makings................. 11
VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED...........11
VII. DISSENTING VIEWS................................................13

The amendment is as follows:
Strike all after the enacting clause and insert the
following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Permanent IRA Charitable Contribution
Act of 2014''.

SEC. 2. RULE ALLOWING CERTAIN TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL
RETIREMENTS ACCOUNTS FOR CHARITABLE PURPOSES MADE
PERMANENT.

(a) In General.--Section 408(d)(8) of the Internal Revenue Code of
1986 is amended by striking subparagraph (F).
(b) Effective Date.--The amendment made by this section shall apply
to distributions made in taxable years beginning after December 31,
2013.

I. SUMMARY AND BACKGROUND

A. Purpose and Summary

H.R. 4619, reported by the Committee on Ways and Means,
provides that individuals who are at least 70\1/2\ years old
may make tax-free distributions of up to $100,000 per year from
an individual retirement account (IRA) to a qualifying
charitable organization. An identical, temporary provision
expired for taxable years beginning after December 31, 2013.

B. Background and Need for Legislation

While the Committee continues actively to pursue
comprehensive tax reform as a critical means of promoting
economic growth and job creation, the Committee also believes
that it is important to provide individuals and small
businesses permanent, immediate tax relief to encourage faster
economic growth and job creation, while fostering charitable
giving. By restoring and making permanent the IRA charitable
distribution option, H.R. 4619 makes permanent an important
incentive to encourage taxpayers to contribute to charitable
and religious organizations that support important programs
across the nation. According to testimony received by the
Committee, in the first two years it was available, the IRA
charitable distribution option prompted more than $140 million
in charitable donations, with the median gift just under
$4,500, to a broad range of tax-exempt organizations from
social service providers and religious organizations to
cultural institutions and schools, organizations that benefit
communities nationwide.

C. Legislative History

Background

H.R. 4619 was introduced on May 8, 2014, and was referred
to the Committee on Ways and Means.

Committee action

The Committee on Ways and Means marked up H.R. 4619, the
Permanent IRA Charitable Contribution Act of 2014, on May 29,
2014, and ordered the bill, as amended, favorably reported
(with a quorum being present).

Committee hearings

The need for permanent rules regarding IRA rollovers for
charitable purposes was discussed at no fewer than two hearings
during the 112th and 113th Congresses:
Select Revenue Measures Subcommittee Hearing
on Certain Expiring Tax Provisions (April 26, 2012);
and
Full Committee Hearing on Tax Reform and
Charitable Contributions (February 14, 2013).

II. EXPLANATION OF THE BILL

A. Tax-Free Distributions From Individual Retirement Plans for
Charitable Purposes (Sec. 408(d)(8) of the Code)

PRESENT LAW

In general

If an amount withdrawn from a traditional individual
retirement arrangement (``IRA'') or a Roth IRA is donated to a
charitable organization, the rules relating to the tax
treatment of withdrawals from IRAs apply to the amount
withdrawn and the charitable contribution is subject to the
normally applicable limitations on deductibility of such
contributions. An exception applies in the case of a qualified
charitable distribution.

Charitable contributions

In computing taxable income, an individual taxpayer who
itemizes deductions generally is allowed to deduct the amount
of cash and up to the fair market value of property contributed
to the following entities: (1) a charity described in section
170(c)(2); (2) certain veterans' organizations, fraternal
societies, and cemetery companies;\1\ and (3) a Federal, State,
or local governmental entity, but only if the contribution is
made for exclusively public purposes.\2\ The deduction also is
allowed for purposes of calculating alternative minimum taxable
income.
---------------------------------------------------------------------------
\1\Secs. 170(c)(3)-(5).
\2\Sec. 170(c)(1).
---------------------------------------------------------------------------
The amount of the deduction allowable for a taxable year
with respect to a charitable contribution of property may be
reduced depending on the type of property contributed, the type
of charitable organization to which the property is
contributed, and the income of the taxpayer.\3\
---------------------------------------------------------------------------
\3\Secs. 170(b) and (e).
---------------------------------------------------------------------------
A taxpayer who takes the standard deduction (i.e., who does
not itemize deductions) may not take a separate deduction for
charitable contributions.\4\
---------------------------------------------------------------------------
\4\Sec. 170(a).
---------------------------------------------------------------------------
A payment to a charity (regardless of whether it is termed
a ``contribution'') in exchange for which the donor receives an
economic benefit is not deductible, except to the extent that
the donor can demonstrate, among other things, that the payment
exceeds the fair market value of the benefit received from the
charity. To facilitate distinguishing charitable contributions
from purchases of goods or services from charities, present law
provides that no charitable contribution deduction is allowed
for a separate contribution of $250 or more unless the donor
obtains a contemporaneous written acknowledgement of the
contribution from the charity indicating whether the charity
provided any good or service (and an estimate of the value of
any such good or service provided) to the taxpayer in
consideration for the contribution.\5\ In addition, under
present law, any charity that receives a contribution exceeding
$75 made partly as a gift and partly as consideration for goods
or services furnished by the charity (a ``quid pro quo''
contribution) is required to inform the contributor in writing
of an estimate of the value of the goods or services furnished
by the charity and that only the portion exceeding the value of
the goods or services may be deductible as a charitable
contribution.\6\
---------------------------------------------------------------------------
\5\Sec. 170(f)(8). For any contribution of a cash, check, or other
monetary gift, no deduction is allowed unless the donor maintains as a
record of such contribution a bank record or written communication from
the donee charity showing the name of the donee organization, the date
of the contribution, and the amount of the contribution. Sec.
170(f)(17).
\6\Sec. 6115.
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Under present law, total deductible contributions of an
individual taxpayer to public charities, private operating
foundations, and certain types of private nonoperating
foundations generally may not exceed 50 percent of the
taxpayer's contribution base, which is the taxpayer's adjusted
gross income for a taxable year (disregarding any net operating
loss carryback). To the extent a taxpayer has not exceeded the
50-percent limitation, (1) contributions of capital gain
property to public charities generally may be deducted up to 30
percent of the taxpayer's contribution base, (2) contributions
of cash to most private nonoperating foundations and certain
other charitable organizations generally may be deducted up to
30 percent of the taxpayer's contribution base, and (3)
contributions of capital gain property to private foundations
and certain other charitable organizations generally may be
deducted up to 20 percent of the taxpayer's contribution base.
Contributions by individuals in excess of the 50-percent,
30-percent, and 20-percent limits generally may be carried over
and deducted over the next five taxable years, subject to the
relevant percentage limitations on the deduction in each of
those years.
In general, a charitable deduction is not allowed for
income, estate, or gift tax purposes if the donor transfers an
interest in property to a charity (e.g., a remainder) while
also either retaining an interest in that property (e.g., an
income interest) or transferring an interest in that property
to a noncharity for less than full and adequate
consideration.\7\ Exceptions to this general rule are provided
for, among other interests, remainder interests in charitable
remainder annuity trusts, charitable remainder unitrusts, and
pooled income funds, and present interests in the form of a
guaranteed annuity or a fixed percentage of the annual value of
the property.\8\ For such interests, a charitable deduction is
allowed to the extent of the present value of the interest
designated for a charitable organization.
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\7\Secs. 170(f), 2055(e)(2), and 2522(c)(2).
\8\Sec. 170(f)(2).
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IRA rules

Within limits, individuals may make deductible and
nondeductible contributions to a traditional IRA. Amounts in a
traditional IRA are includible in income when withdrawn (except
to the extent the withdrawal represents a return of
nondeductible contributions). Certain individuals also may make
nondeductible contributions to a Roth IRA (deductible
contributions cannot be made to Roth IRAs). Qualified
withdrawals from a Roth IRA are excludable from gross income.
Withdrawals from a Roth IRA that are not qualified withdrawals
are includible in gross income to the extent attributable to
earnings. Includible amounts withdrawn from a traditional IRA
or a Roth IRA before attainment of age 59\1/2\ are subject to
an additional 10-percent early withdrawal tax, unless an
exception applies. Under present law, minimum distributions are
required to be made from tax-favored retirement arrangements,
including IRAs. Minimum required distributions from a
traditional IRA must generally begin by April 1 of the calendar
year following the year in which the IRA owner attains age
70\1/2\.\9\
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\9\Minimum distribution rules also apply in the case of
distributions after the death of a traditional or Roth IRA owner.
---------------------------------------------------------------------------
If an individual has made nondeductible contributions to a
traditional IRA, a portion of each distribution from an IRA is
nontaxable until the total amount of nondeductible
contributions has been received. In general, the amount of a
distribution that is nontaxable is determined by multiplying
the amount of the distribution by the ratio of the remaining
nondeductible contributions to the account balance. In making
the calculation, all traditional IRAs of an individual are
treated as a single IRA, all distributions during any taxable
year are treated as a single distribution, and the value of the
contract, income on the contract, and investment in the
contract are computed as of the close of the calendar year.
In the case of a distribution from a Roth IRA that is not a
qualified distribution, in determining the portion of the
distribution attributable to earnings, contributions and
distributions are deemed to be distributed in the following
order: (1) regular Roth IRA contributions; (2) taxable
conversion contributions;\10\ (3) nontaxable conversion
contributions; and (4) earnings. In determining the amount of
taxable distributions from a Roth IRA, all Roth IRA
distributions in the same taxable year are treated as a single
distribution, all regular Roth IRA contributions for a year are
treated as a single contribution, and all conversion
contributions during the year are treated as a single
contribution.
---------------------------------------------------------------------------
\10\Conversion contributions refer to conversions of amounts in a
traditional IRA to a Roth IRA.
---------------------------------------------------------------------------
Distributions from an IRA (other than a Roth IRA) are
generally subject to withholding unless the individual elects
not to have withholding apply.\11\ Elections not to have
withholding apply are to be made in the time and manner
prescribed by the Secretary.
---------------------------------------------------------------------------
\11\Sec. 3405.
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Qualified charitable distributions

Otherwise taxable IRA distributions from a traditional or
Roth IRA are excluded from gross income to the extent they are
qualified charitable distributions.\12\ The exclusion may not
exceed $100,000 per taxpayer per taxable year. Special rules
apply in determining the amount of an IRA distribution that is
otherwise taxable. Taxpayers who elect to make qualified
conservation contributions may not claim a charitable deduction
for such amounts. The otherwise applicable rules regarding
taxation of IRA distributions and the deduction of charitable
contributions continue to apply to distributions from an IRA
that are not qualified charitable distributions. A qualified
charitable distribution is taken into account for purposes of
the minimum distribution rules applicable to traditional IRAs
to the same extent the distribution would have been taken into
account under such rules had the distribution not been directly
distributed under the qualified charitable distribution
provision. An IRA does not fail to qualify as an IRA as a
result of qualified charitable distributions being made from
the IRA.
---------------------------------------------------------------------------
\12\Sec. 408(d)(8). The exclusion does not apply to distributions
from employer-sponsored retirement plans, including SIMPLE IRAs and
simplified employee pensions (``SEPs'').
---------------------------------------------------------------------------
A qualified charitable distribution is any distribution
from an IRA directly by the IRA trustee to an organization
described in section 170(b)(1)(A) (generally, public charities)
other than a supporting organization (as described in section
509(a)(3)) or a donor advised fund (as defined in section
4966(d)(2)). Distributions are eligible for the exclusion only
if made on or after the date the IRA owner attains age 70\1/2\
and only to the extent the distribution would be includible in
gross income (without regard to this provision).
The exclusion applies only if a charitable contribution
deduction for the entire distribution otherwise would be
allowable (under present law), determined without regard to the
generally applicable percentage limitations. Thus, for example,
if the deductible amount is reduced because of a benefit
received in exchange, or if a deduction is not allowable
because the donor did not obtain sufficient substantiation, the
exclusion is not available with respect to any part of the IRA
distribution.
If the IRA owner has any IRA that includes nondeductible
contributions, a special rule applies in determining the
portion of a distribution that is includible in gross income
(but for the qualified charitable distribution provision) and
thus is eligible for qualified charitable distribution
treatment. Under the special rule, the distribution is treated
as consisting of income first, up to the aggregate amount that
would be includible in gross income (but for the qualified
charitable distribution provision) if the aggregate balance of
all IRAs having the same owner were distributed during the same
year. In determining the amount of subsequent IRA distributions
includible in income, proper adjustments are to be made to
reflect the amount treated as a qualified charitable
distribution under the special rule.
Distributions that are excluded from gross income by reason
of the qualified charitable distribution provision are not
taken into account in determining the deduction for charitable
contributions under section 170.
Under present law, the exclusion does not apply to
distributions made in taxable years beginning after December
31, 2013.

REASONS FOR CHANGE

The Committee believes that facilitating charitable
contributions from IRAs will increase giving to charitable
organizations. Therefore, the Committee believes that the
exclusion for qualified charitable distributions should be
permanently extended.

EXPLANATION OF PROVISION

The provision reinstates and makes permanent the exclusion
from gross income for qualified charitable distributions from
an IRA.

EFFECTIVE DATE

The provision is effective for distributions made in
taxable years beginning after December 31, 2013.

III. VOTES OF THE COMMITTEE

In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, the following statement is made
concerning the vote of the Committee on Ways and Means in its
consideration of H.R. 4619, the Permanent IRA Charitable
Contribution Act of 2014, on May 29, 2014.
The bill, H.R. 4619, was ordered favorably reported as
amended by a roll call vote of 23 yeas to 14 nays (with a
quorum being present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
Representative Yea Nay Present Representative Yea Nay Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp....................... X ....... ......... Mr. Levin......... ........ X .........
Mr. Johnson.................... X ....... ......... Mr. Rangel........ ........ X .........
Mr. Brady...................... X ....... ......... Mr. McDermott..... ........ X .........
Mr. Ryan....................... X ....... ......... Mr. Lewis......... ........ ........ .........
Mr. Nunes...................... X ....... ......... Mr. Neal.......... ........ X .........
Mr. Tiberi..................... X ....... ......... Mr. Becerra....... ........ X .........
Mr. Reichert................... X ....... ......... Mr. Doggett....... ........ X .........
Mr. Boustany................... X ....... ......... Mr. Thompson...... ........ X .........
Mr. Roskam..................... X ....... ......... Mr. Larson........ ........ X .........
Mr. Gerlach.................... X ....... ......... Mr. Blumenauer.... ........ X .........
Mr. Price...................... X ....... ......... Mr. Kind.......... ........ X .........
Mr. Buchanan................... X ....... ......... Mr. Pascrell...... ........ ........ .........
Mr. Smith...................... X ....... ......... Mr. Crowley....... ........ X .........
Mr. Schock..................... X ....... ......... Ms. Schwartz...... ........ X .........
Ms. Jenkins.................... X ....... ......... Mr. Davis......... ........ X .........
Mr. Paulsen.................... X ....... ......... Ms. Sanchez....... ........ X .........
Mr. Marchant................... X ....... .........
Ms. Black...................... X ....... .........
Mr. Reed....................... X ....... .........
Mr. Young...................... X ....... .........
Mr. Kelly...................... X ....... .........
Mr. Griffin.................... X ....... .........
Mr. Renacci.................... X ....... .........
----------------------------------------------------------------------------------------------------------------

IV. BUDGET EFFECTS OF THE BILL

A. Committee Estimate of Budgetary Effects

In compliance with clause 3(d) of rule XIII of the Rules of
the House of Representatives, the following statement is made
concerning the effects on the budget of the bill, H.R. 4619, as
reported.
The bill, as reported, is estimated to have the following
effect on Federal budget receipts for fiscal years 2014-2024:

FISCAL YEARS
[Millions of Dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014-19 2014-24
--------------------------------------------------------------------------------------------------------------------------------------------------------
-124 -691 -659 -702 -775 -813 -855 -895 -933 -967 -1,001 -3,764 -8,415
--------------------------------------------------------------------------------------------------------------------------------------------------------

B. Statement Regarding New Budget Authority and Tax Expenditures Budget
Authority

In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee states that the
bill involves no new or increased budget authority. The
Committee further states that the revenue-reducing tax
provisions involve increased tax expenditures. (See amounts in
table in Part IV.A., above.)

C. Cost Estimate Prepared by the Congressional Budget Office

In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, requiring a cost estimate
prepared by the CBO, the following statement by CBO is
provided.

U.S. Congress,
Congressional Budget Office,
Washington, DC, June 5, 2014.
Hon. Dave Camp,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 4619, the
Permanent IRA Charitable Contribution Act of 2014.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Logan
Timmerhoff.
Sincerely,
Douglas W. Elmendorf.
Enclosure.

H.R. 4619--Permanent IRA Charitable Contribution Act of 2014

H.R. 4619 would amend the Internal Revenue Code to
reinstate and make permanent a rule that had allowed eligible
taxpayers to exclude from taxable income certain distributions
from their individual retirement accounts (IRAs) that were
directly donated to qualifying charities. Under current law,
the rule expired for distributions made after December 31,
2013. The tax treatment under H.R. 4619 would apply to
taxpayers over the age of 70 years and six months, and would be
limited to $100,000 per taxpayer for any year. Qualified
donations would include those to most public charities that
would be deductible for taxpayers who itemize their income tax
deductions. Taxpayers who excluded amounts from taxable income
as a result of the bill would not be allowed to also claim an
itemized deduction for such amounts. Amounts donated from IRAs
would count for purposes of required minimum distributions.
The staff of the Joint Committee on Taxation (JCT)
estimates that enacting H.R. 4619 would reduce revenues, thus
increasing federal budget deficits, by about $8.4 billion over
the 2014-2024 period.
The Statutory Pay-As-You-Go Act of 2010 establishes budget-
reporting and enforcement procedures for legislation affecting
direct spending and revenues. Enacting H.R. 4619 would result
in revenue losses in each year beginning in 2014. The estimated
increases in the deficit are shown in the following table.
JCT has determined that the bill contains no
intergovernmental or private-sector mandates as defined in the
Unfunded Mandates Reform Act.
The CBO staff contact for this estimate is Logan
Timmerhoff. The estimate was approved by David Weiner,
Assistant Director for Tax Analysis.

CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 4619, AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON MAY 29, 2014
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
---------------------------------------------------------------------------------------------------
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014-2019 2014-2024
--------------------------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE IN THE DEFICITStatutory Pay-As-You-Go Effects..................... 124 691 659 702 775 813 855 895 933 967 1,001 3,764 8,415
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: Staff of the Joint Committee on Taxation.

D. Macroeconomic Impact Analysis

In compliance with clause 3(h)(2) of rule XIII of the Rules
of the House of Representatives, the following statement is
made by the Joint Committee on Taxation with respect to the
provisions of the bill amending the Internal Revenue Code of
1986: the effects of the bill on economic activity are so small
as to be incalculable within the context of a model of the
aggregate economy.

V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE

A. Committee Oversight Findings and Recommendations

With respect to clause 3(c)(1) of rule XIII of the Rules of
the House of Representatives (relating to oversight findings),
the Committee advises that it was as a result of the
Committee's review of the provisions of H.R. 4619 that the
Committee concluded that it is appropriate to report the bill,
as amended, favorably to the House of Representatives with the
recommendation that the bill do pass.

B. Statement of General Performance Goals and Objectives

With respect to clause 3(c)(4) of rule XIII of the Rules of
the House of Representatives, the Committee advises that the
bill contains no measure that authorizes funding, so no
statement of general performance goals and objectives for which
any measure authorizes funding is required.

C. Information Relating to Unfunded Mandates

This information is provided in accordance with section 423
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
The Committee has determined that the bill does not contain
Federal mandates on the private sector. The Committee has
determined that the bill does not impose a Federal
intergovernmental mandate on State, local, or tribal
governments.

D. Applicability of House Rule XXI 5(b)

Rule XXI 5(b) of the Rules of the House of Representatives
provides, in part, that ``A bill or joint resolution,
amendment, or conference report carrying a Federal income tax
rate increase may not be considered as passed or agreed to
unless so determined by a vote of not less than three-fifths of
the Members voting, a quorum being present.'' The Committee has
carefully reviewed the bill, and states that the bill does not
involve any Federal income tax rate increases within the
meaning of the rule.

E. Tax Complexity Analysis

Section 4022(b) of the Internal Revenue Service
Restructuring and Reform Act of 1998 (the ``IRS Reform Act'')
requires the staff of the Joint Committee on Taxation (in
consultation with the Internal Revenue Service and the Treasury
Department) to provide a tax complexity analysis. The
complexity analysis is required for all legislation reported by
the Senate Committee on Finance, the House Committee on Ways
and Means, or any committee of conference if the legislation
includes a provision that directly or indirectly amends the
Internal Revenue Code and has widespread applicability to
individuals or small businesses.
Pursuant to clause 3(h)(1) of rule XIII of the Rules of the
House of Representatives, the staff of the Joint Committee on
Taxation has determined that a complexity analysis is not
required under section 4022(b) of the IRS Reform Act because
the bill contains no provisions that amend the Code and that
have ``widespread applicability'' to individuals or small
businesses, within the meaning of the rule.

F. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits

With respect to clause 9 of rule XXI of the Rules of the
House of Representatives, the Committee has carefully reviewed
the provisions of the bill, and states that the provisions of
the bill do not contain any congressional earmarks, limited tax
benefits, or limited tariff benefits within the meaning of the
rule.

G. Duplication of Federal Programs

In compliance with Sec. 3(j)(2) of H. Res. 5 (113th
Congress), the Committee states that no provision of the bill
establishes or reauthorizes: (1) a program of the Federal
Government known to be duplicative of another Federal program,
(2) a program included in any report from the Government
Accountability Office to Congress pursuant to section 21 of
Public Law 111-139, or (3) a program related to a program
identified in the most recent Catalog of Federal Domestic
Assistance, published pursuant to the Federal Program
Information Act (Public Law 95-220, as amended by Public Law
98-169).

H. Disclosure of Directed Rule Makings

In compliance with Sec. 3(k) of H. Res. 5 (113th Congress),
the following statement is made concerning directed rule
makings: The Committee estimates that the bill requires no
directed rule makings within the meaning of such section.

VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):

INTERNAL REVENUE CODE OF 1986

* * * * * * *

Subtitle A--Income Taxes

* * * * * * *

CHAPTER 1--NORMAL TAXES AND SURTAXES

* * * * * * *

Subchapter D--Deferred Compensation, Etc

* * * * * * *

PART I--PENSION, PROFIT-SHARING, STOCK BONUS PLANS, ETC

* * * * * * *

Subpart A--General Rule

* * * * * * *

SEC. 408. INDIVIDUAL RETIREMENT ACCOUNTS.

(a) * * *

* * * * * * *

(d) Tax Treatment of Distributions.--
(1) * * *

* * * * * * *

(8) Distributions for charitable purposes.--
(A) * * *

* * * * * * *

[(F) Termination.--This paragraph shall not
apply to distributions made in taxable years
beginning after December 31, 2013.]

* * * * * * *

VII. DISSENTING VIEWS

The six bills approved by the Republicans at the markup
would add $304 billion to the deficit. Combined with the $310
billion that the six bills approved by Republicans on the
Committee in April added to the deficit, Republicans have added
$614 billion to the deficit in two short months--and there does
not appear to be an end in sight. Even though some of these
bills were introduced individually with some bipartisan
support, the opposition to these bills was based on the
position that these tax provisions should not be made permanent
by adding to the deficit without any revenue offset.
To put the combined cost ($614 billion) into context, it is
25 percent more than the entire projected federal deficit this
year and $86 billion more than total non-defense domestic
discretionary spending (e.g., medical research, education,
veterans' pensions and health care, transportation, etc.) will
be in 2014. It is almost seven times what we spend annually on
education, job training, and social services. It is ten times
more than we spend on veterans. And, it is eleven times more
than we spend on medical research and public health.
Public charities and private foundations serve an important
role in our society. We all support the good works of the
charitable community and strive to provide charities with the
resources they need to carry out their charitable mission. The
markup was not to debate the good works of charities across
this country, or the merits of H.R. 4619 which makes permanent
the IRA charitable rollover provision.
We found it hypocritical that the Republicans would make
permanent a provision that was specifically permitted to expire
in Chairman Camp's Tax Reform Act of 2014 discussion draft.
We also found it hypocritical that, four months ago,
Republicans let emergency unemployment insurance expire for
more than 1.3 million Americans by arguing that an adequate
offset had yet to be proposed. In early April, the Senate came
to a bipartisan agreement on an offset after months of
painstaking negotiations. Yet House Republicans still refuse to
act.
Finally, we also opposed the manner in which Republicans
were proceeding--selecting 10 to make permanent without any
offset from the approximately 60 tax provisions that expired
last year. This approach was both fiscally irresponsible and
fundamentally hypocritical.
The consideration of this bill should have been part of the
consideration of all the expired tax provisions commonly
referred to as ``tax extenders.'' The Republicans did not take
up other tax extenders that also are important to Democratic
Committee Members. Left to an uncertain fate are provisions
like the Work Opportunity Tax Credit, the New Markets Tax
Credit, and the renewable energy tax credits, as well as the
long-term status of the Earned Income Tax Credit, the Child Tax
Credit, and the American Opportunity Tax Credit.
Sincerely,
Sander M. Levin,
Ranking Member.