I 
110TH CONGRESS 
2D SESSION 
H. R. 7083 
To amend the Internal Revenue Code of 1986 to enhance charitable giving 
and improve disclosure and tax administration. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 25, 2008 
Mr. LEWIS of Georgia (for himself, Mr. RAMSTAD, Mr. THOMPSON of Cali-
fornia, Mr. KIND, Mr. POMEROY, and Mr. NEAL of Massachusetts) intro-
duced the following bill; which was referred to the Committee on Ways 
and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to enhance 
charitable giving and improve disclosure and tax adminis-
tration. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Charity Enhancement Act of 2008’’. 
(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this Act an amend-
ment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference 
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shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title, etc. 
Sec. 2. Funds advised by certain public charities and governmental entities not 
treated as donor advised funds. 
Sec. 3. Certain scholarship distributions from donor advised funds not treated 
as taxable distributions. 
Sec. 4. Repeal of special written acknowledgment requirement for charitable 
contributions to donor advised funds. 
Sec. 5. Reasonable compensation paid by supporting organizations to substan-
tial contributors not treated as an excess benefit. 
Sec. 6. Exception from holdings and payout requirements for longstanding, 
fully funded type III supporting organizations. 
Sec. 7. Contributions by Indian tribal governments treated same as contribu-
tions by States. 
Sec. 8. Electronic filing of exempt organization annual returns. 
Sec. 9. Expansion of bad check penalty to electronic payments, etc. 
SEC. 2. FUNDS ADVISED BY CERTAIN PUBLIC CHARITIES 
AND GOVERNMENTAL ENTITIES NOT TREAT-
ED AS DONOR ADVISED FUNDS. 
(a) IN GENERAL.—Subparagraph (B) of section 
4966(d)(2) is amended by striking ‘‘or’’ at the end of 
clause (i), by striking the period at the end of clause (ii) 
and inserting ‘‘, or’’, and by adding at the end the fol-
lowing new clause: 
‘‘(iii) if all contributions to such fund 
or account have been made, and all advi-
sory privileges referred to in subparagraph 
(A)(iii) with respect to such fund or ac-
count have been exercised, by either— 
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‘‘(I) one or more organizations 
described in clause (i), (ii), (iii), (iv), 
or (vi) of section 170(b)(1)(A) or sec-
tion 509(a)(2), or 
‘‘(II) one or more entities de-
scribed in section 170(c)(1).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after the 
date of the enactment of this Act. 
SEC. 3. CERTAIN SCHOLARSHIP DISTRIBUTIONS FROM 
DONOR ADVISED FUNDS NOT TREATED AS 
TAXABLE DISTRIBUTIONS. 
(a) IN GENERAL.—Subsection (c) of section 4966 is 
amended by adding at the end the following new para-
graph: 
‘‘(3) EXCEPTION
FOR
CERTAIN
SCHOLARSHIP 
DISTRIBUTIONS.— 
‘‘(A) IN GENERAL.—The term ‘taxable dis-
tribution’ shall not include any qualified schol-
arship distribution from a qualified scholarship 
fund. 
‘‘(B) QUALIFIED SCHOLARSHIP DISTRIBU-
TION.—The term ‘qualified scholarship distribu-
tion’ means any grant to a natural person for 
travel, study, or other similar purposes made 
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from a donor advised fund if all such grants 
meet 
the 
requirements 
of 
subsection 
(d)(2)(B)(ii)(III). 
‘‘(C) QUALIFIED
SCHOLARSHIP
FUND.— 
The term ‘qualified scholarship fund’ means 
any donor advised fund if— 
‘‘(i) the advisory privileges referred to 
in subsection (d)(2)(A)(iii) with respect to 
such fund are exercised solely by an orga-
nization described in paragraph (4) of sec-
tion 501(c) and exempt from tax under 
section 501(a), and 
‘‘(ii) substantially all of the distribu-
tions from such fund are qualified scholar-
ship distributions.’’. 
(b) APPLICATION OF TAX ON PROHIBITED BENEFITS 
TO
QUALIFIED
SCHOLARSHIP
DISTRIBUTIONS.—Sub-
section (c) of section 4967 is amended by adding at the 
end the following new paragraph: 
‘‘(3) QUALIFIED SCHOLARSHIP FUNDS.—Each 
substantial contributor (as defined in section 
4958(c)(3)(C)) to a qualified scholarship fund and 
each family member (within the meaning of section 
4958(f)(4)) of such person shall be treated as a per-
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son described in subsection (d) with respect to such 
fund.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to distributions made after the 
date of the enactment of this Act. 
SEC. 4. REPEAL OF SPECIAL WRITTEN ACKNOWLEDGMENT 
REQUIREMENT FOR CHARITABLE CONTRIBU-
TIONS TO DONOR ADVISED FUNDS. 
(a) IN GENERAL.—Paragraph (18) of section 170(f) 
is amended— 
(1) by striking subparagraph (B), 
(2) by striking ‘‘if—’’ and all that follows 
through ‘‘the sponsoring organization (as defined in 
section 4966(d)(1))’’ and inserting ‘‘if the spon-
soring 
organization 
(as 
defined 
in 
section 
4966(d)(1)))’’, and 
(3) by redesignating clauses (i) and (ii) of sub-
paragraph (A) (as in effect before amendment by 
paragraph (2)) as subparagraphs (A) and (B) and 
by moving such subparagraphs 2 ems to the left. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after the 
date of the enactment of this Act. 
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SEC. 5. REASONABLE COMPENSATION PAID BY SUP-
PORTING ORGANIZATIONS TO SUBSTANTIAL 
CONTRIBUTORS NOT TREATED AS AN EXCESS 
BENEFIT. 
(a) 
IN
GENERAL.—Clause 
(ii) 
of 
section 
4958(c)(3)(A) is amended to read as follows: 
‘‘(ii) the term ‘excess benefit’ includes, 
with respect to any transaction described 
in clause (i)— 
‘‘(I) in the case of any grant, 
loan, or similar payment, the amount 
of such grant, loan, or similar pay-
ment, and 
‘‘(II) in the case of any com-
pensation or similar payment, the 
amount by which the value of the eco-
nomic benefit provided exceeds the 
value of the consideration (including 
the performance of services) received 
for providing such benefit.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to amounts paid pursuant to trans-
actions entered into after the date of the enactment of 
this Act. 
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SEC. 6. EXCEPTION FROM HOLDINGS AND PAYOUT RE-
QUIREMENTS FOR LONGSTANDING, FULLY 
FUNDED TYPE III SUPPORTING ORGANIZA-
TIONS. 
(a) HOLDINGS REQUIREMENTS.—Subsection (f) of 
section 4943 is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(8) EXCEPTION FOR CERTAIN LONGSTANDING 
FULLY
FUNDED
TYPE
III
SUPPORTING
ORGANIZA-
TIONS.—Paragraph (1) shall not apply to any orga-
nization if— 
‘‘(A) the organization was established be-
fore January 1, 1970, 
‘‘(B) the organization has not accepted any 
substantial contributions after December 31, 
1970, 
‘‘(C) no donor to the organization was 
alive on August 17, 2006, and 
‘‘(D) no family member (within the mean-
ing of section 4958(f)(4)) of any donor is an or-
ganization manager (as defined in section 
4958(f)(2)).’’. 
(b) PAYOUT REQUIREMENTS.—Section 1241(d)(1) of 
the Pension Protection Act of 2006 shall not apply to any 
organization described in section 4943(f)(8) of the Inter-
nal Revenue Code of 1986, as added by this section. 
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(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after the 
date of the enactment of this Act. 
SEC. 7. CONTRIBUTIONS BY INDIAN TRIBAL GOVERNMENTS 
TREATED 
SAME 
AS 
CONTRIBUTIONS 
BY 
STATES. 
(a) IN GENERAL.—Section 7871(a) (relating to In-
dian tribal governments treated as States for certain pur-
poses) is amended by striking ‘‘and’’ at the end of para-
graph (6), by striking the period at the end of paragraph 
(7) and inserting ‘‘; and’’, and by adding at the end the 
following new paragraph: 
‘‘(8) for purposes of— 
‘‘(A) determining support of an organiza-
tion described in section 170(b)(1)(A)(vi), and 
‘‘(B) determining whether an organization 
is described in paragraph (1) or (2) of section 
509(a) for purposes of section 509(a)(3).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply with respect to— 
(1) support received on or after the date of the 
enactment of this Act, and 
(2) the determination of the status of any orga-
nization with respect to any taxable year beginning 
after such date of enactment. 
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SEC. 8. ELECTRONIC FILING OF EXEMPT ORGANIZATION 
ANNUAL RETURNS. 
(a) IN GENERAL.—Subsection (d) of section 6104 
(relating to public inspection of certain annual returns, re-
ports, applications for exemption, and notices of status) 
is amended— 
(1) by redesignating the paragraph relating to 
disclosure of reports by Internal Revenue Service as 
paragraph (7), 
(2) by redesignating the paragraph relating to 
application to nonexempt charitable trusts and non-
exempt private foundations as paragraph (8), and 
(3) by adding at the end the following new 
paragraph: 
‘‘(9) RETURNS REQUIRED ON MAGNETIC MEDIA, 
ETC.—Any organization (other than an organization 
exempt from tax under section 527(a)) which— 
‘‘(A) is required to make available informa-
tion for inspection under paragraph (1)(A), and 
‘‘(B) would be required to file returns on 
magnetic media or in other machine-readable 
form under subsection (e) of section 6011 if 
such subsection were applied by substituting ‘at 
least 5 returns’ for ‘at least 250 returns’ in 
paragraph (2)(A) thereof, 
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shall file the information referred to in clauses (i) 
and (ii) of paragraph (1)(A) on such magnetic media 
or in other machine-readable form.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to returns required to be filed 
for taxable years beginning after the date of the enactment 
of this Act. 
SEC. 9. EXPANSION OF BAD CHECK PENALTY TO ELEC-
TRONIC PAYMENTS, ETC. 
(a) IN GENERAL.—Section 6657 (relating to bad 
checks) is amended by adding at the end the following: 
‘‘Except as otherwise provided by the Secretary, any au-
thorization of a payment by commercially acceptable 
means (within the meaning of section 6311) shall be treat-
ed for purposes of this section in the same manner as a 
check.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to authorizations of payments 
made after December 31, 2005. 
Æ 
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