II

104TH CONGRESS

1ST SESSION S. 789

To amend the Internal Revenue Code of 1986 to make permanent the section

170(e)(5) rules pertaining to gifts of publicly-traded stock to certain

private foundations, and for other purposes.

IN THE SENATE OF THE UNITED STATES

MAY 10 (legislative day, MAY 1), 1995

Mr. CHAFEE (for himself, Mr. MOYNIHAN, and Mr. KYL) 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 make

permanent the section 170(e)(5) rules pertaining to gifts

of publicly-traded stock to certain private foundations,

and for other purposes.

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

3 SECTION 1. GIFTS OF QUALIFIED APPRECIATED STOCK TO

4 PRIVATE FOUNDATIONS.

5 (a) IN GENERAL.—Paragraph (5) of section 170(e)

6 of the Internal Revenue Code of 1986 (relating to special

7 rule for contributions of stock for which market quotations
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1 are readily available) is amended by striking subparagraph

2 (D).

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

4 subsection (a) shall apply to contributions made after De5 cember 31, 1994.

6 SEC. 2. PRIVATE FOUNDATION GRANTS TO FOREIGN ORGA7 NIZATIONS TREATED AS PRIVATE FOUNDA8 TIONS.

9 (a) IN GENERAL.—Paragraph (3) of section 4942(g)

10 of the Internal Revenue Code of 1986 (relating to certain

11 contributions to section 501(c)(3) organizations) is

12 amended to read as follows:

13 ‘‘(3) CERTAIN CONTRIBUTIONS TO SECTION

14 501(c)(3) ORGANIZATIONS.—For purposes of this sec15 tion, the term ‘qualifying distribution’ includes a

16 contribution to a section 501(c)(3) organization de17 scribed in paragraph (1)(A) (i) or (ii) if—

18 ‘‘(A) not later than the close of the first

19 taxable year after its taxable year in which such

20 contribution is received—

21 ‘‘(i) such organization makes a dis22 tribution equal to the amount of such con23 tribution and such distribution is a qualify24 ing distribution (within the meaning of

25 paragraph (1) or (2), without regard to
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1 this paragraph) which is treated under

2 subsection (h) as a distribution out of cor3 pus (or would be so treated if such section

4 501(c)(3) organization were a private foun5 dation which is not an operating founda6 tion), or

7 ‘‘(ii) in the case of a grant to a for8 eign organization that is not controlled (di9 rectly or indirectly) by the foundation or 1

10 or more disqualified persons (as defined in

11 section 4946) with respect to the founda12 tion, such organization makes expenditures

13 equal to the amount of such contribution

14 to accomplish 1 or more purposes de15 scribed in section 170(c)(2)(B) and the

16 grantor foundation exercises expenditure

17 responsibility with respect to the grant (as

18 defined in section 4945(h)), and

19 ‘‘(B) the private foundation making the

20 contribution obtains adequate records or other

21 sufficient evidence from such organization

22 showing that the requirements of subparagraph

23 (A) are satisfied.’’
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1 (b) EFFECTIVE DATE.—The amendment made by

2 subsection (a) shall apply to taxable years beginning after

3 December 31, 1994.

4 SEC. 3. CHANGING DUE DATE FOR FIRST QUARTER ESTI5 MATED TAX PAYMENTS BY PRIVATE FOUNDA6 TIONS.

7 (a) IN GENERAL.—Paragraph (3) of section 6655(g)

8 of the Internal Revenue Code of 1986 (relating to certain

9 tax exempt organizations) is amended by inserting after

10 subparagraph (C) the following new subparagraph:

11 ‘‘(D) In the case of any private foundation,

12 subsection (c)(2) shall be applied by substitut13 ing ‘May 15’ for ‘April 15 ’. ’’

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

15 subsection (a) shall apply to taxable years beginning after

16 December 31, 1995.

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