1760 
fied disaster) and such individual was displaced 
from such principal place of abode by reason of 
such qualified disaster. 
(3) APPLICABLE TAXABLE YEAR.—For purposes 
of this subsection, the term ‘‘applicable taxable year’’ 
means— 
(A) in the case of a qualified individual 
other than an individual described in subpara-
graph (B), any taxable year which includes any 
portion of the incident period of the qualified 
disaster to which the qualified disaster area re-
ferred to in paragraph (2)(A) relates, or 
(B) in the case of a qualified individual de-
scribed in subparagraph (B) of paragraph (2), 
any taxable year which includes any portion of 
the period described in such subparagraph. 
(4) EARNED INCOME.—For purposes of this sub-
section, the term ‘‘earned income’’ has the meaning 
given such term under section 32(c) of the Internal 
Revenue Code of 1986. 
(5) SPECIAL RULES.— 
(A) APPLICATION TO JOINT RETURNS.—For 
purposes of paragraph (1), in the case of a joint 
return for an applicable taxable year—
1761 
(i) such paragraph shall apply if ei-
ther spouse is a qualified individual, and 
(ii) the earned income of the taxpayer 
for the preceding taxable year shall be the 
sum of the earned income of each spouse for 
such preceding taxable year. 
(B) UNIFORM APPLICATION OF ELECTION.— 
Any election made under paragraph (1) shall 
apply with respect to both sections 24(d) and 32 
of the Internal Revenue Code of 1986. 
(C) ERRORS TREATED AS MATHEMATICAL 
ERROR.—For purposes of section 6213 of the In-
ternal Revenue Code of 1986, an incorrect use on 
a return of earned income pursuant to para-
graph (1) shall be treated as a mathematical or 
clerical error. 
(D) NO
EFFECT
ON
DETERMINATION
OF 
GROSS INCOME, ETC.—Except as otherwise pro-
vided in this subsection, the Internal Revenue 
Code of 1986 shall be applied without regard to 
any substitution under paragraph (1).
1762 
SEC. 205. AUTOMATIC EXTENSION OF FILING DEADLINES IN 
CASE OF CERTAIN TAXPAYERS AFFECTED BY 
FEDERALLY DECLARED DISASTERS. 
(a) IN GENERAL.—Section 7508A is amended by add-
ing at the end the following new subsection: 
‘‘(d) MANDATORY 60-DAY EXTENSION.— 
‘‘(1) IN GENERAL.—In the case of any qualified 
taxpayer, the period— 
‘‘(A) beginning on the earliest incident date 
specified in the declaration to which the disaster 
area referred to in paragraph (2) relates, and 
‘‘(B) ending on the date which is 60 days 
after the latest incident date so specified, 
shall be disregarded in the same manner as a period 
specified under subsection (a). 
‘‘(2) QUALIFIED
TAXPAYER.—For purposes of 
this subsection, the term ‘qualified taxpayer’ means— 
‘‘(A) any individual whose principal resi-
dence (for purposes of section 1033(h)(4)) is lo-
cated in a disaster area, 
‘‘(B) any taxpayer if the taxpayer’s prin-
cipal place of business (other than the business 
of performing services as an employee) is located 
in a disaster area, 
‘‘(C) any individual who is a relief worker 
affiliated with a recognized government or phil-
1763 
anthropic organization and who is assisting in 
a disaster area, 
‘‘(D) any taxpayer whose records necessary 
to meet a deadline for an act described in section 
7508(a)(1) are maintained in a disaster area, 
‘‘(E) any individual visiting a disaster 
area who was killed or injured as a result of the 
disaster, and 
‘‘(F) solely with respect to a joint return, 
any spouse of an individual described in any 
preceding subparagraph of this paragraph. 
‘‘(3) DISASTER AREA.—For purposes of this sub-
section, the term ‘disaster area’ has the meaning 
given such term under subparagraph (B) of section 
165(i)(5) with respect to a Federally declared disaster 
(as defined in subparagraph (A) of such section). 
‘‘(4) APPLICATION TO RULES REGARDING PEN-
SIONS.—In the case of any person described in sub-
section (b), a rule similar to the rule of paragraph (1) 
shall apply for purposes of subsection (b) with respect 
to— 
‘‘(A) making contributions to a qualified re-
tirement plan (within the meaning of section 
4974(c)) under section 219(f)(3), 404(a)(6), 
404(h)(1)(B), or 404(m)(2),
1764 
‘‘(B) making distributions under section 
408(d)(4), 
‘‘(C) recharacterizing contributions under 
section 408A(d)(6), and 
‘‘(D) making a rollover under section 
402(c), 403(a)(4), 403(b)(8), or 408(d)(3). 
‘‘(5) COORDINATION WITH PERIODS SPECIFIED 
BY THE SECRETARY.—Any period described in para-
graph (1) with respect to any person (including by 
reason of the application of paragraph (4)) shall be 
in addition to (or concurrent with, as the case may 
be) any period specified under subsection (a) or (b) 
with respect to such person.’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to federally declared disasters declared 
after the date of the enactment of this Act. 
SEC. 206. MODIFICATION OF THE TAX RATE FOR THE EX-
CISE TAX ON INVESTMENT INCOME OF PRI-
VATE FOUNDATIONS. 
(a) IN GENERAL.—Section 4940(a) is amended by 
striking ‘‘2 percent’’ and inserting ‘‘1.39 percent’’. 
(b) ELIMINATION OF REDUCED TAX WHERE FOUNDA-
TION MEETS CERTAIN DISTRIBUTION REQUIREMENTS.— 
Section 4940 is amended by striking subsection (e).
1765 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after the date 
of the enactment of this Act. 
SEC. 207. ADDITIONAL LOW-INCOME HOUSING CREDIT AL-
LOCATIONS FOR QUALIFIED 2017 AND 2018 
CALIFORNIA DISASTER AREAS. 
(a) IN GENERAL.—For purposes of section 42 of the 
Internal Revenue Code of 1986, the State housing credit 
ceiling for California for calendar year 2020 shall be in-
creased by the lesser of— 
(1) the aggregate housing credit dollar amount 
allocated by the State housing credit agencies of Cali-
fornia for such calendar year to buildings located in 
qualified 2017 and 2018 California disaster areas, or 
(2) 50 percent of the sum of the State housing 
credit ceilings for California for calendar years 2017 
and 2018. 
(b) ALLOCATIONS TREATED AS MADE FIRST FROM 
ADDITIONAL ALLOCATION FOR PURPOSES OF DETERMINING 
CARRYOVER.—For purposes of determining the unused 
State housing credit ceiling for any calendar year under 
section 42(h)(3)(C) of the Internal Revenue Code of 1986, 
any increase in the State housing credit ceiling under sub-
section (a) shall be treated as an amount described in clause 
(ii) of such section.
1766 
(c) DEFINITIONS.—For purposes of this section— 
(1) QUALIFIED 2017 AND 2018 CALIFORNIA DIS-
ASTER AREAS.—The term ‘‘qualified 2017 and 2018 
California disaster areas’’ means any area in Cali-
fornia which was determined by the President (before 
January 1, 2019) to warrant individual or indi-
vidual and public assistance from the Federal Gov-
ernment under the Robert T. Stafford Disaster Relief 
and Emergency Assistance Act by reason of a major 
disaster the incident period of which begins or ends 
in calendar year 2017 or 2018. Notwithstanding sec-
tion 201, for purposes of the preceding sentence, the 
term ‘‘incident period’’ means the period specified by 
the Federal Emergency Management Agency as the 
period during which the disaster occurred. 
(2) OTHER DEFINITIONS.—Terms used in this 
section which are also used in section 42 of the Inter-
nal Revenue Code of 1986 shall have the same mean-
ing in this section as in such section 42. 
SEC. 208. TREATMENT OF CERTAIN POSSESSIONS. 
(a) PAYMENTS TO POSSESSIONS WITH MIRROR CODE 
TAX SYSTEMS.—The Secretary of the Treasury shall pay 
to each possession of the United States which has a mirror 
code tax system amounts equal to the loss (if any) to that 
possession by reason of the application of the provisions of
1767 
this title. Such amounts shall be determined by the Sec-
retary of the Treasury based on information provided by 
the government of the respective possession. 
(b) PAYMENTS TO OTHER POSSESSIONS.—The Sec-
retary of the Treasury shall pay to each possession of the 
United States which does not have a mirror code tax system 
amounts estimated by the Secretary of the Treasury as 
being equal to the aggregate benefits (if any) that would 
have been provided to residents of such possession by reason 
of the provisions of this title if a mirror code tax system 
had been in effect in such possession. The preceding sentence 
shall not apply unless the respective possession has a plan, 
which has been approved by the Secretary of the Treasury, 
under which such possession will promptly distribute such 
payments to its residents. 
(c) MIRROR CODE TAX SYSTEM.—For purposes of this 
section, the term ‘‘mirror code tax system’’ means, with re-
spect to any possession of the United States, the income tax 
system of such possession if the income tax liability of the 
residents of such possession under such system is determined 
by reference to the income tax laws of the United States 
as if such possession were the United States. 
(d) TREATMENT OF PAYMENTS.—For purposes of sec-
tion 1324 of title 31, United States Code, the payments 
under this section shall be treated in the same manner as
1768 
a refund due from a credit provision referred to in sub-
section (b)(2) of such section. 
TITLE III—OTHER PROVISIONS 
SEC. 301. MODIFICATION OF INCOME FOR PURPOSES OF 
DETERMINING TAX-EXEMPT STATUS OF CER-
TAIN MUTUAL OR COOPERATIVE TELEPHONE 
OR ELECTRIC COMPANIES. 
(a) IN GENERAL.—Section 501(c)(12) is amended by 
adding at the end the following new subparagraph: 
‘‘(J) In the case of a mutual or cooperative 
telephone or electric company described in this 
paragraph, subparagraph (A) shall be applied 
without taking into account any income received 
or accrued from— 
‘‘(i) any grant, contribution, or assist-
ance provided pursuant to the Robert T. 
Stafford Disaster Relief and Emergency As-
sistance Act or any similar grant, contribu-
tion, or assistance by any local, State, or 
regional governmental entity for the pur-
pose of relief, recovery, or restoration from, 
or preparation for, a disaster or emergency, 
or 
‘‘(ii) any grant or contribution by any 
governmental entity (other than a contribu-
1769 
tion in aid of construction or any other 
contribution as a customer or potential cus-
tomer) the purpose of which is substantially 
related to providing, constructing, restoring, 
or 
relocating 
electric, 
communication, 
broadband, internet, or other utility facili-
ties or services.’’. 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall apply to taxable years beginning after Decem-
ber 31, 2017. 
SEC. 302. REPEAL OF INCREASE IN UNRELATED BUSINESS 
TAXABLE INCOME FOR CERTAIN FRINGE BEN-
EFIT EXPENSES. 
(a) IN GENERAL.—Section 512(a) is amended by strik-
ing paragraph (7). 
(b) EFFECTIVE DATE.—The amendment made by this 
section shall take effect as if included in the amendments 
made by section 13703 of Public Law 115–97. 
Attest: 
Clerk.
116TH CONGRESS 
1ST SESSION 
H.R. 1865 
HOUSE AMENDMENT TO 
SENATE AMENDMENT