II 

118TH CONGRESS 

2D SESSION S. 4136 

To amend the Internal Revenue Code of 1986 to terminate the tax-exempt 

status of terrorist supporting organizations. 

IN THE SENATE OF THE UNITED STATES 

APRIL 17, 2024 

Mr. CORNYN (for himself and Mr. KING) introduced the following bill; which 

was read twice and referred to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to terminate 

the tax-exempt status of terrorist supporting organizations. 

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

3 SECTION 1. TERMINATION OF TAX-EXEMPT STATUS OF 

4 TERRORIST SUPPORTING ORGANIZATIONS. 

5 (a) IN GENERAL.—Section 501(p) of the Internal 

6 Revenue Code of 1986 is amended by adding at the end 

7 the following new paragraph: 

8 ‘‘(8) APPLICATION TO TERRORIST SUPPORTING

9 ORGANIZATIONS.— 


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1 ‘‘(A) IN GENERAL.—For purposes of this 

2 subsection, in the case of any terrorist sup3 porting organization— 

4 ‘‘(i) such organization (and the des5 ignation of such organization under sub6 paragraph (B)) shall be treated as de7 scribed in paragraph (2), and 

8 ‘‘(ii) the period of suspension de9 scribed in paragraph (3) with respect to 

10 such organization shall be treated as begin11 ning on the date that the Secretary des12 ignates such organization under subpara13 graph (B) and ending on the date that the 

14 Secretary rescinds such designation under 

15 subparagraph (D). 

16 ‘‘(B) TERRORIST SUPPORTING ORGANIZA17 TION.—For purposes of this paragraph, the 

18 term ‘terrorist supporting organization’ means 

19 any organization which is designated by the 

20 Secretary as having provided, during the 3-year 

21 period ending on the date of such designation, 

22 material support or resources (within the mean23 ing of section 2339B of title 18, United States 

24 Code) to an organization described in para25 graph (2) (determined after the application of 


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1 this paragraph to such organization) in excess 

2 of a de minimis amount. 

3 ‘‘(C) DESIGNATION PROCEDURE.— 

4 ‘‘(i) NOTICE REQUIREMENT.—Prior to 

5 designating any organization as a terrorist 

6 supporting organization under subpara7 graph (B), the Secretary shall mail to the 

8 most recent mailing address provided by 

9 such organization on the organization’s an10 nual return or notice under section 6033 

11 (or subsequent form indicating a change of 

12 address) a written notice which includes— 

13 ‘‘(I) a statement that the Sec14 retary will designate such organization 

15 as a terrorist supporting organization 

16 unless the organization satisfies the 

17 requirements of subclause (I) or (II) 

18 of clause (ii), 

19 ‘‘(II) the name of the organiza20 tion or organizations with respect to 

21 which the Secretary has determined 

22 such organization provided material 

23 support or sources as described in 

24 subparagraph (B), and 


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1 ‘‘(III) a description of such mate2 rial support or resources to the extent 

3 consistent with national security and 

4 law enforcement interests. 

5 ‘‘(ii) OPPORTUNITY TO CURE.—In the 

6 case of any notice provided to an organiza7 tion under clause (i), the Secretary shall, 

8 at the close of the 90-day period beginning 

9 on the date that such notice was sent, des10 ignate such organization as a terrorist sup11 porting organization under subparagraph 

12 (B) if (and only if) such organization has 

13 not (during such period)— 

14 ‘‘(I) demonstrated to the satisfac15 tion of the Secretary that such organi16 zation did not provide the material 

17 support or resources referred to in 

18 subparagraph (B), or 

19 ‘‘(II) made reasonable efforts to 

20 have such support or resources re21 turned to such organization and cer22 tified in writing to the Secretary that 

23 such organization will not provide any 

24 further support or resources to orga25 nizations described in paragraph (2). 


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1 A certification under subclause (II) shall 

2 not be treated as valid if the organization 

3 making such certification has provided any 

4 other such certification during the pre5 ceding 5 years. 

6 ‘‘(D) RESCISSION.—The Secretary shall re7 scind a designation under subparagraph (B) if 

8 (and only if)— 

9 ‘‘(i) the Secretary determines that 

10 such designation was erroneous, 

11 ‘‘(ii) after the Secretary receives a 

12 written certification from an organization 

13 that such organization did not receive the 

14 notice described in subparagraph (C)(i)— 

15 ‘‘(I) the Secretary determines 

16 that it is reasonable to believe that 

17 such organization did not receive such 

18 notice, and 

19 ‘‘(II) such organization satisfies 

20 the requirements of subclause (I) or 

21 (II) of subparagraph (C)(ii) (deter22 mined after taking into account the 

23 last sentence thereof), or 

24 ‘‘(iii) the Secretary determines, with 

25 respect to all organizations to which the 


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1 material support or resources referred to 

2 in subparagraph (B) were provided, the pe3 riods of suspension under paragraph (3) 

4 have ended. 

5 A certification described in the matter pre6 ceding subclause (I) of clause (ii) shall not be 

7 treated as valid if the organization making such 

8 certification has provided any other such certifi9 cation during the preceding 5 years. 

10 ‘‘(E) ADMINISTRATIVE REVIEW BY INTER11 NAL REVENUE SERVICE INDEPENDENT OFFICE

12 OF APPEALS.—In the case of the designation of 

13 an organization by the Secretary as a terrorist 

14 supporting organization under subparagraph 

15 (B), a dispute regarding such designation shall 

16 be subject to resolution by the Internal Revenue 

17 Service Independent Office of Appeals under 

18 section 7803(e) in the same manner as if such 

19 designation were made by the Internal Revenue 

20 Service and paragraph (5) of this subsection 

21 did not apply. 

22 ‘‘(F) JURISDICTION OF UNITED STATES

23 COURTS.—Notwithstanding paragraph (5), the 

24 United States district courts shall have exclu25 sive jurisdiction to review a final determination 


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1 with respect to an organization’s designation as 

2 a terrorist supporting organization under sub3 paragraph (B). In the case of any such deter4 mination which was based on classified informa5 tion (as defined in section 1(a) of the Classified 

6 Information Procedures Act), such information 

7 may be submitted to the reviewing court ex 

8 parte and in camera. For purposes of this sub9 paragraph, a determination with respect to an 

10 organization’s designation as a terrorist sup11 porting organization shall not fail to be treated 

12 as a final determination merely because such 

13 organization fails to utilize the dispute resolu14 tion process of the Internal Revenue Service 

15 Independent Office of Appeals provided under 

16 subparagraph (E).’’. 

17 (b) EFFECTIVE DATE.—The amendment made by 

18 this section shall apply to designations made after the date 

19 of the enactment of this Act in taxable years ending after 

20 such date. 

Æ 


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