To amend the Internal Revenue Code of 1986 to allow a deduction for investment advisory expenses of certain funeral and cemetery trusts during suspension of miscellaneous itemized deductions, and for other purposes.

To amend the Internal Revenue Code of 1986 to allow a deduction for investment advisory expenses of certain funeral and cemetery trusts during suspension of miscellaneous itemized deductions, and for other purposes. 1. Deduction for investment advisory expenses of certain funeral and cemetery trusts allowed during suspension of miscellaneous itemized deductions (a) In general Section 67(g) (1) by striking Notwithstanding (1) In general Notwithstanding , and (2) by adding at the end the following new paragraph: (2) Deduction for investment advisory expenses of certain funeral and cemetery trusts allowed during suspension In the case of any qualified funeral trust (as defined in section 685(b)) or cemetery perpetual care fund (described in section 642(i) and meeting the requirements of paragraphs (1) and (2) thereof), subsection (a) and paragraph (1) of this subsection shall not apply to any deduction allowed for investment advisory expenses for a taxable year beginning after December 31, 2023, and before January 1, 2030. . (b) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2023. 2. Special rule for distributions by cemetery perpetual funds indexed to inflation (a) In general Section 642(i) (i) Certain distributions by cemetery perpetual care funds (1) In general In the case of a cemetery perpetual care fund which— (A) was created pursuant to local law by a taxable cemetery corporation for the care and maintenance of cemetery property, and (B) is treated for the taxable year as a trust for purposes of this subchapter, any amount distributed by such fund for the care and maintenance of gravesites which have been purchased from the cemetery corporation before the beginning of the taxable year of the trust and with respect to which there is an obligation to furnish care and maintenance shall be considered to be a distribution solely for purposes of sections 651 and 661, but only to the extent that the aggregate amount so distributed during the taxable year does not exceed $25 multiplied by the aggregate number of such gravesites. (2) Inflation adjustment In the case of any taxable year to which this subsection applies and which begins after 2024, the $25 amount in paragraph (1)(A) shall be increased by an amount equal to— (A) such dollar amount, multiplied by (B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2023 calendar year 2016 . (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2023.

Summary: This bill allows a tax deduction for the investment advisory expenses of certain funeral trusts and cemetery perpetual care funds during the period in which the allowance of miscellaneous itemized deductions is suspended (i.e., 2018 through 2025). The bill also revises provisions relating to distributions by cemetery perpetual funds for the care and maintenance of gravesites. The aggregate amount of such distributions may not exceed $25 (adjusted for inflation) multiplied by the aggregate number of such gravesites.