I

106TH CONGRESS

1ST SESSION H. R. 1446

To amend the Internal Revenue Code of 1986 to allow a tax-free distribution

from qualified retirement plan to the extent that the distribution is

contributed for charitable purposes.

IN THE HOUSE OF REPRESENTATIVES

APRIL 15, 1999

Mr. DUNCAN 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

tax-free distribution from a qualified retirement plan to

the extent that the distribution is contributed for charitable 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. TAX-FREE DISTRIBUTIONS FROM PROFIT-SHAR4 ING PENSION PLANS FOR CERTAIN CHARI5 TABLE PURPOSES.

6 (a) IN GENERAL.—Section 401 of the Internal Rev7 enue Code of 1986 (relating to qualified pension, profit8 sharing, and stock bonus plans) is amended by redesig-
2

•HR 1446 IH

1 nating subsection (o) as subsection (p) and by inserting

2 after subsection (n) the following new subsection:

3 ‘‘(o) DISTRIBUTIONS FOR CHARITABLE PURPOSES.—

4 ‘‘(1) IN GENERAL.—A trust forming part of a

5 profit-sharing or pension plan shall not be treated as

6 failing to constitute a qualified trust under this sec7 tion merely because the stock bonus, profit-sharing

8 or pension plan of which such trust is a part makes

9 1 or more qualified charitable distributions.

10 ‘‘(2) EXCLUSION FROM INCOME.—No amount

11 shall be includible in the gross income of a plan par12 ticipant by reason of a qualified charitable distribu13 tion (irrespective of whether such qualified chari14 table distribution is made with respect to a chari15 table pledge of such plan participant) from a stock

16 bonus, profit-sharing or pension plan—

17 ‘‘(A) to an organization described in sec18 tion 170(c),

19 ‘‘(B) to a charitable remainder annuity

20 trust or a charitable remainder unitrust (as

21 such terms are defined in section 664(d)),

22 ‘‘(C) to a pooled income fund (as defined

23 in section 642(c)(5)), or

24 ‘‘(D) for the issuance of a charitable gift

25 annuity (as defined in section 501(m)(5)).
3

•HR 1446 IH

1 ‘‘(3) SPECIAL RULES RELATING TO CHARI2 TABLE REMAINDER TRUSTS, POOLED INCOME

3 FUNDS, AND CHARITABLE GIFT ANNUITIES.—

4 ‘‘(A) IN GENERAL.—Paragraph (2) shall

5 apply to a trust, fund, or annuity referred to in

6 subparagraph (B), (C), or (D) of paragraph (2)

7 only if no person holds an income interest in

8 the amounts in the trust, fund, or annuity at9 tributable to such distribution other than one or

10 more of the following:

11 ‘‘(i) the individual for whose benefit

12 amounts in the stock bonus, or profit-shar13 ing pension plan are maintained and from

14 which such distribution was made,

15 ‘‘(ii) the spouse of such individual, or

16 ‘‘(iii) any organization described in

17 section 170(c)(2).

18 ‘‘(B) DETERMINATION OF INCLUSION OF

19 AMOUNTS DISTRIBUTED.—In determining the

20 amount includible in the gross income of any

21 person by reason of a payment or distribution

22 from a trust referred to in paragraph (2)(B) or

23 a charitable gift annuity (as so defined), the

24 portion of any qualified charitable distribution

25 to such trust or for such annuity which would
4

•HR 1446 IH

1 (but for this paragraph) have been includible in

2 gross income—

3 ‘‘(i) shall be treated as income de4 scribed in section 664(b)(1), and

5 ‘‘(ii) shall not be treated as an invest6 ment in the contract.

7 ‘‘(C) NO INCLUSION FOR DISTRIBUTION TO

8 POOLED INCOME FUND.—No amount shall be

9 includible in the gross income of a pooled in10 come fund (as so defined) by reason of a quali11 fied charitable distribution to such fund.

12 ‘‘(4) QUALIFIED CHARITABLE DISTRIBUTION.—

13 For purposes of this subsection, the term ‘qualified

14 charitable distribution’ means any transfer or dis15 tribution from amounts in a stock bonus, or profit16 sharing pension plan maintained for the benefit of

17 an individual—

18 ‘‘(A) which is made on or after the date

that such individual has attained age 591 19 ⁄2, and

20 ‘‘(B) which is made directly from such

21 plan to—

22 ‘‘(i) an organization described in sec23 tion 170(c)(2), or
5

•HR 1446 IH

1 ‘‘(ii) a trust, fund, or annuity referred

2 to in subparagraph (B), (C), or (D) of

3 paragraph (2).

4 ‘‘(5) DENIAL OF DEDUCTION.—No deduc5 tion under section 170 shall be allowable to a

6 taxpayer for the taxable year for the qualified

7 charitable distributions made during such year

8 with respect to such taxpayer.

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

10 subsection (a) shall apply to distributions made after the

11 date of the enactment of this Act.

Æ