I 

111TH CONGRESS 

1ST SESSION H. R. 1952 

To amend the Internal Revenue Code of 1986 to allow a credit against 

income tax for amounts contributed to charitable organizations which 

provide elementary or secondary school scholarships and for contributions 

of, and for, instructional materials and materials for extracurricular 

activities. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 2, 2009 

Mr. PAUL (for himself and Mr. HOEKSTRA) introduced the following bill; 

which was referred to the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to allow a 

credit against income tax for amounts contributed to 

charitable organizations which provide elementary or secondary school scholarships and for contributions of, and 

for, instructional materials and materials for extracurricular activities. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Education Improve5 ment Tax Cut Act’’. 


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1 SEC. 2. CREDIT FOR CONTRIBUTIONS TO CHARITABLE OR2 GANIZATIONS WHICH PROVIDE ELEMENTARY 

3 OR SECONDARY SCHOOL SCHOLARSHIPS. 

4 (a) IN GENERAL.—Subpart A of part IV of sub5 chapter A of chapter 1 of the Internal Revenue Code of 

6 1986 (relating to nonrefundable personal credits) is 

7 amended by inserting after section 25D the following new 

8 section: 

9 ‘‘SEC. 25E. CONTRIBUTIONS TO ORGANIZATIONS PRO10 VIDING ELEMENTARY OR SECONDARY 

11 SCHOOL SCHOLARSHIPS. 

12 ‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in13 dividual, there shall be allowed as a credit against the tax 

14 imposed by this chapter for the taxable year an amount 

15 equal to the qualified scholarship contributions of the tax16 payer for the taxable year. 

17 ‘‘(b) MAXIMUM CREDIT.—The credit allowed by sub18 section (a) for any taxable year shall not exceed $5,000 

19 (one-half such amount in the case of a married individual 

20 (as determined under section 7703) filing a separate re21 turn). 

22 ‘‘(c) QUALIFIED SCHOLARSHIP CONTRIBUTION.— 

23 For purposes of this section— 

24 ‘‘(1) IN GENERAL.—The term ‘qualified schol25 arship contribution’ means, with respect to any tax26 able year, the amount which would (but for subVerDate Nov 24 2008 00:34 Apr 07, 2009 Jkt 079200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1952.IH H1952

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1 section (d)) be allowable as a deduction under sec2 tion 170 for cash contributions to a school tuition 

3 organization. 

4 ‘‘(2) SCHOOL TUITION ORGANIZATION.— 

5 ‘‘(A) IN GENERAL.—The term ‘school tui6 tion organization’ means any organization de7 scribed in section 170(c)(2) if the annual dis8 bursements of the organization for elementary 

9 and secondary school scholarships are normally 

10 not less than 90 percent of the sum of such or11 ganization’s annual gross income and contribu12 tions and gifts. 

13 ‘‘(B) ELEMENTARY AND SECONDARY

14 SCHOOL SCHOLARSHIP.—The term ‘elementary 

15 and secondary school scholarship’ means any 

16 scholarship excludable from gross income under 

17 section 117 for expenses related to education at 

18 or below the 12th grade. 

19 ‘‘(d) DENIAL OF DOUBLE BENEFIT.—No deduction 

20 shall be allowed under this chapter for any contribution 

21 for which a credit is allowed under this section. 

22 ‘‘(e) ELECTION TO HAVE CREDIT NOT APPLY.— 

23 ‘‘(1) IN GENERAL.—A taxpayer may elect to 

24 have this section not apply for any taxable year. 


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1 ‘‘(2) TIME FOR MAKING ELECTION.—An elec2 tion under paragraph (1) for any taxable year may 

3 be made (or revoked) at any time before the expira4 tion of the 3-year period beginning on the last date 

5 prescribed by law for filing the return for such tax6 able year (determined without regard to extensions). 

7 ‘‘(f) COST-OF-LIVING ADJUSTMENT.—In the case of 

8 any taxable year beginning in a calendar year after 2009, 

9 the dollar amount contained in subsection (b) shall be in10 creased by an amount equal to— 

11 ‘‘(1) such dollar amount, multiplied by 

12 ‘‘(2) the cost-of-living adjustment determined 

13 under section 1(f)(3) for the calendar year in which 

14 the taxable year begins, by substituting ‘calendar 

15 year 2008’ for ‘calendar year 1992’ in subparagraph 

16 (B) thereof. 

17 If any increase determined under the preceding sentence 

18 is not a multiple of $10, such increase shall be increased 

19 to the next highest multiple of $10. In the case of a mar20 ried individual (as determined under section 7703) filing 

21 a separate return, the preceding sentence shall be applied 

22 by substituting ‘$5’ for ‘$10’ each place it appears. 

23 ‘‘(g) REGULATIONS.—The Secretary shall prescribe 

24 regulations to carry out this section, including regulations 


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1 providing for claiming the credit under this section on 

2 Form 1040EZ.’’. 

3 (b) CLERICAL AMENDMENT.—The table of sections 

4 for subpart A of part IV of subchapter A of chapter 1 

5 of such Code is amended by inserting after the item relat6 ing to section 25D the following new item: 

‘‘Sec. 25E. Contributions to organizations providing elementary or secondary 

school scholarships.’’. 

7 (c) EFFECTIVE DATE.—The amendments made by 

8 this section shall apply to taxable years beginning after 

9 December 31, 2008. 

10 SEC. 3. CREDIT FOR CONTRIBUTIONS OF AND FOR IN11 STRUCTIONAL MATERIALS AND MATERIALS 

12 FOR EXTRACURRICULAR ACTIVITIES. 

13 (a) IN GENERAL.—Subpart A of part IV of sub14 chapter A of chapter 1 of the Internal Revenue Code of 

15 1986 (relating to nonrefundable personal credits), as 

16 amended by this Act, is amended by inserting after section 

17 25E the following new section: 

18 ‘‘SEC. 25F. CONTRIBUTIONS OF AND FOR INSTRUCTIONAL 

19 MATERIALS AND MATERIALS FOR EXTRA20 CURRICULAR ACTIVITIES. 

21 ‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in22 dividual, there shall be allowed as a credit against the tax 

23 imposed by this chapter for the taxable year an amount 


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1 equal to the qualified school materials contributions of the 

2 taxpayer for the taxable year. 

3 ‘‘(b) MAXIMUM CREDIT.—The credit allowed by sub4 section (a) for any taxable year shall not exceed $5,000 

5 (one-half such amount in the case of a married individual 

6 (as determined under section 7703) filing a separate re7 turn). 

8 ‘‘(c) QUALIFIED SCHOOL MATERIALS CONTRIBU9 TION.—For purposes of this section— 

10 ‘‘(1) IN GENERAL.—The term ‘qualified school 

11 materials contribution’ means, with respect to any 

12 taxable year, the amount which would (but for sub13 section (d)) be allowable as a deduction under sec14 tion 170 for— 

15 ‘‘(A) any cash contribution to any elemen16 tary or secondary school if such contribution is 

17 designated to be used solely to acquire qualified 

18 school materials, 

19 ‘‘(B) any contribution of qualified school 

20 materials to any elementary or secondary 

21 school, and 

22 ‘‘(C) any cash contribution to a school ma23 terials organization. 

24 ‘‘(2) ELEMENTARY OR SECONDARY SCHOOL.— 

25 The term ‘elementary or secondary school’ means 


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1 any organization described in section 

2 170(b)(1)(A)(ii) which provides education solely at 

3 or below the 12th grade. 

4 ‘‘(3) SCHOOL MATERIALS ORGANIZATION.— 

5 ‘‘(A) IN GENERAL.—The term ‘school ma6 terials organization’ means any organization de7 scribed in section 170(c)(2) if— 

8 ‘‘(i) the primary function of the orga9 nization is to raise funds for elementary or 

10 secondary schools, and 

11 ‘‘(ii) the annual disbursements of the 

12 organization for qualified school materials 

13 which are provided to elementary and sec14 ondary schools are normally not less than 

15 90 percent of the sum of such organiza16 tion’s annual gross income and contribu17 tions and gifts. 

18 ‘‘(B) QUALIFIED SCHOOL MATERIALS.— 

19 The term ‘qualified school materials’ means— 

20 ‘‘(i) instructional materials and equip21 ment, including library books and mate22 rials, computers, and computer software, 

23 and 

24 ‘‘(ii) materials and equipment for 

25 school-sponsored extracurricular activities. 


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1 ‘‘(d) DENIAL OF DOUBLE BENEFIT.—No deduction 

2 shall be allowed under this chapter for any contribution 

3 for which a credit is allowed under this section. 

4 ‘‘(e) ELECTION TO HAVE CREDIT NOT APPLY.— 

5 ‘‘(1) IN GENERAL.—A taxpayer may elect to 

6 have this section not apply for any taxable year. 

7 ‘‘(2) TIME FOR MAKING ELECTION.—An elec8 tion under paragraph (1) for any taxable year may 

9 be made (or revoked) at any time before the expira10 tion of the 3-year period beginning on the last date 

11 prescribed by law for filing the return for such tax12 able year (determined without regard to extensions). 

13 ‘‘(f) COST-OF-LIVING ADJUSTMENT.—In the case of 

14 any taxable year beginning in a calendar year after 2009, 

15 the dollar amount contained in subsection (b) shall be in16 creased by an amount equal to— 

17 ‘‘(1) such dollar amount, multiplied by 

18 ‘‘(2) the cost-of-living adjustment determined 

19 under section 1(f)(3) for the calendar year in which 

20 the taxable year begins, by substituting ‘calendar 

21 year 2008’ for ‘calendar year 1992’ in subparagraph 

22 (B) thereof. 

23 If any increase determined under the preceding sentence 

24 is not a multiple of $10, such increase shall be increased 

25 to the next highest multiple of $10. In the case of a marVerDate Nov 24 2008 00:34 Apr 07, 2009 Jkt 079200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H1952.IH H1952

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1 ried individual (as determined under section 7703) filing 

2 a separate return, the preceding sentence shall be applied 

3 by substituting ‘$5’ for ‘$10’ each place it appears. 

4 ‘‘(g) REGULATIONS.—The Secretary shall prescribe 

5 regulations to carry out this section, including regulations 

6 providing for claiming the credit under this section on 

7 Form 1040EZ.’’. 

8 (b) CLERICAL AMENDMENT.—The table of sections 

9 for subpart A of part IV of subchapter A of chapter 1 

10 of such Code, as amended by this Act, is amended by in11 serting after the item relating to section 25E the following 

12 new item: 

‘‘Sec. 25F. Contributions of and for instructional materials and materials for 

extracurricular activities.’’. 

13 (c) EFFECTIVE DATE.—The amendments made by 

14 this section shall apply to taxable years beginning after 

15 December 31, 2008. 

Æ 


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