Preserving Charitable Incentives Act

I 116TH CONGRESS 2D SESSION H. R. 8817 To provide incentives to make charitable contributions of certain inventory. IN THE HOUSE OF REPRESENTATIVES NOVEMBER 24, 2020 Mr. PANETTA (for himself and Mr. SMITH of Nebraska) introduced the following bill; which was referred to the Committee on Ways and Means A BILL To provide incentives to make charitable contributions of certain inventory. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Preserving Charitable 4 Incentives Act’’. 5 SEC. 2. INCENTIVES TO MAKE CHARITABLE CONTRIBU- 6 TIONS OF CERTAIN INVENTORY. 7 (a) TEMPORARY INCREASE IN LIMITATION ON 8 QUALIFIED CONTRIBUTIONS.— 9 (1) SUSPENSION OF CURRENT LIMITATION.— 10 Except as otherwise provided in paragraph (2), 11 VerDate Sep 11 2014 04:30 Dec 02, 2020 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H8817.IH H8817 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 8817 IH qualified contributions shall be disregarded in apply- 1 ing subsections (b)(2), (d), and (e)(3)(C)(ii) of sec- 2 tion 170 of the Internal Revenue Code of 1986. 3 (2) APPLICATION OF INCREASED LIMITATION.— 4 For purposes of section 170 of the Internal Revenue 5 Code of 1986— 6 (A) LIMITATION.—Any qualified contribu- 7 tion shall be allowed as a deduction only to the 8 extent that the aggregate of such contributions 9 does not exceed the excess of the taxpayer’s 10 taxable income (as determined under paragraph 11 (2) of section 170(b) of such Code) over the 12 amount of all other charitable contributions al- 13 lowed under such paragraph. 14 (B) CARRYOVER.—If the aggregate 15 amount of qualified contributions made in the 16 contribution year (within the meaning of section 17 170(d)(2) of such Code) exceeds the limitation 18 of subparagraph (A), such excess shall be ap- 19 propriately taken into account under section 20 170(b)(2) of such Code subject to the limita- 21 tions thereof. 22 (C) CARRYOVER OF FOOD INVENTORY 23 CONTRIBUTIONS.—If the aggregate amount of 24 qualified contributions described in section 25 VerDate Sep 11 2014 04:30 Dec 02, 2020 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H8817.IH H8817 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 8817 IH 170(e)(3)(C)(i) of such Code made in such con- 1 tribution year exceeds the limitation of subpara- 2 graph (A), such excess shall be appropriately 3 taken into account under section 4 170(e)(3)(C)(iii) of such Code subject to the 5 limitations thereof, and the application of sub- 6 paragraph (B) shall be adjusted accordingly. 7 (3) QUALIFIED CONTRIBUTIONS.—For purposes 8 of this subsection, the term ‘‘qualified contribution’’ 9 means any qualified contribution (as defined in sec- 10 tion 170(e)(3)(A) of the Internal Revenue Code of 11 1986) which— 12 (A) is made during a taxable year of the 13 corporation which begins during 2020 or 2021, 14 and 15 (B) does not consist of any drug or biologi- 16 cal product that requires a prescription of a 17 physician for its use by an individual. 18 (4) ELECTION.—A contribution shall be taken 19 into account as a qualified contribution for purposes 20 of this subsection only if the corporation elects (at 21 such time and in such manner as the Secretary may 22 provide) the application of this subsection with re- 23 spect to such contribution. 24 VerDate Sep 11 2014 04:30 Dec 02, 2020 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H8817.IH H8817 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 8817 IH (b) ELECTION TO TREAT QUALIFIED CONTRIBU- 1 TIONS AS MADE IN PRIOR TAXABLE YEAR.—In the case 2 of any qualified contribution (as defined in subsection 3 (a)(3) and determined without regard to this subsection) 4 made during the corporation’s first taxable year beginning 5 in 2020 with respect to which the corporation elects (as 6 such time and in such manner as the Secretary may pro- 7 vide) the application of this subsection— 8 (1) such contribution shall be treated as made 9 in the taxable year preceding such taxable year (and 10 not in such taxable year), and 11 (2) such contribution shall not be treated as a 12 qualified contribution for purposes of subsection (a). 13 (c) CLARIFICATION OF TREATMENT OF INVENTORY 14 COSTS.—The Secretary of the Treasury, or the Sec- 15 retary’s designee, shall clarify, though a notice or other 16 administrative guidance, the treatment of inventory costs 17 as cost of goods sold for purposes of section 170 of the 18 Internal Revenue Code of 1986. 19 Æ VerDate Sep 11 2014 04:30 Dec 02, 2020 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H8817.IH H8817 kjohnson on DSK79L0C42PROD with BILLS