property must account for the mixed use on a calendar 
year basis, and may file for the credit with respect to 
mixed use property in any month following the calendar 
year giving rise to the credit. 
‘‘(c) CROSS REFERENCE.—For business use conver-
sion credit, see section 202. 
‘‘SEC. 706. NOT-FOR-PROFIT ORGANIZATIONS. 
‘‘(a) NOT-FOR-PROFIT ORGANIZATIONS.—Dues, con-
tributions, and similar payments to qualified not-for-profit 
organizations shall not be considered gross payments for 
taxable property or services for purposes of this subtitle. 
‘‘(b) DEFINITION.—For purposes of this section, the 
term ‘qualified not-for-profit organization’ means a not- 
for-profit organization organized and operated exclu-
sively— 
‘‘(1) for religious, charitable, scientific, testing 
for public safety, literary, or educational purposes; 
‘‘(2) as civic leagues or social welfare organiza-
tions; 
‘‘(3) as labor, agricultural, or horticultural or-
ganizations; 
‘‘(4) as chambers of commerce, business 
leagues, or trade associations; or 
‘‘(5) as fraternal beneficiary societies, orders, or 
associations; 
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no part of the net earnings of which inures to the benefit 
of any private shareholder or individual. 
‘‘(c) QUALIFICATION CERTIFICATES.—Upon applica-
tion in a form prescribed by the Secretary, the sales tax 
administering authority shall provide qualification certifi-
cates to qualified not-for-profit organizations. 
‘‘(d) TAXABLE TRANSACTIONS.—If a qualified not- 
for-profit organization provides taxable property or serv-
ices in connection with contributions, dues, or similar pay-
ments to the organization, then it shall be required to 
treat the provision of said taxable property or services as 
a purchase taxable pursuant to this subtitle at the fair 
market value of said taxable property or services. 
‘‘(e) EXEMPTIONS.—Taxable property and services 
purchased by a qualified not-for-profit organization shall 
be eligible for the exemptions provided in section 102. 
‘‘CHAPTER 8—FINANCIAL 
INTERMEDIATION SERVICES 
‘‘Sec. 801. Determination of financial intermediation services amount. 
‘‘Sec. 802. Bad debts. 
‘‘Sec. 803. Timing of tax on financial intermediation services. 
‘‘Sec. 804. Financing leases. 
‘‘Sec. 805. Basic interest rate. 
‘‘Sec. 806. Foreign financial intermediation services. 
‘‘SEC. 801. DETERMINATION OF FINANCIAL INTERMEDI-
ATION SERVICES AMOUNT. 
‘‘(a) FINANCIAL INTERMEDIATION SERVICES.—For 
purposes of this subtitle— 
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‘‘(1) IN GENERAL.—The term ‘financial inter-
mediation services’ means the sum of— 
‘‘(A) explicitly charged fees for financial 
intermediation services, and 
‘‘(B) implicitly charged fees for financial 
intermediation services. 
‘‘(2) EXPLICITLY CHARGED FEES FOR FINAN-
CIAL INTERMEDIATION SERVICES.—The term ‘explic-
itly charged fees for financial intermediation serv-
ices’ includes— 
‘‘(A) brokerage fees; 
‘‘(B) explicitly stated banking, loan origi-
nation, processing, documentation, credit check 
fees, or other similar fees; 
‘‘(C) safe-deposit box fees; 
‘‘(D) insurance premiums, to the extent 
such premiums are not allocable to the invest-
ment account of the underlying insurance pol-
icy; 
‘‘(E) trustees’ fees; and 
‘‘(F) other financial services fees (includ-
ing mutual fund management, sales, and exit 
fees). 
‘‘(3) IMPLICITLY CHARGED FEES FOR FINAN-
CIAL INTERMEDIATION SERVICES.— 
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‘‘(A) IN GENERAL.—The term ‘implicitly 
charged fees for financial intermediation serv-
ices’ includes the gross imputed amount in rela-
tion to any underlying interest-bearing invest-
ment, account, or debt. 
‘‘(B) GROSS IMPUTED AMOUNT.—For pur-
poses of subparagraph (A), the term ‘gross im-
puted amount’ means— 
‘‘(i) with respect to any underlying in-
terest-bearing investment or account, the 
product of— 
‘‘(I) the excess (if any) of the 
basic interest rate (as defined in sec-
tion 805) over the rate paid on such 
investment; and 
‘‘(II) the amount of the invest-
ment or account; and 
‘‘(ii) with respect to any underlying 
interest-bearing debt, the product of— 
‘‘(I) the excess (if any) of the 
rate paid on such debt over the basic 
interest rate (as defined in section 
805); and 
‘‘(II) the amount of the debt. 
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100 
‘‘(b) SELLER OF FINANCIAL INTERMEDIATION SERV-
ICES.—For purposes of section 103(a), the seller of finan-
cial intermediation services shall be— 
‘‘(1) in the case of explicitly charged fees for fi-
nancial intermediation services, the seller shall be 
the person who receives the gross payments for the 
charged financial intermediation services; 
‘‘(2) in the case of implicitly charged fees for fi-
nancial intermediation services with respect to any 
underlying interest-bearing investment or account, 
the person making the interest payments on the in-
terest-bearing investment or account; and 
‘‘(3) in the case of implicitly charged fees for fi-
nancial intermediation services with respect to any 
interest-bearing debt, the person receiving the inter-
est payments on the interest-bearing debt. 
‘‘SEC. 802. BAD DEBTS. 
‘‘(a) IN GENERAL.—For purposes of section 205(a), 
a bad debt shall be a business debt that becomes wholly 
or partially worthless to the payee. 
‘‘(b) BUSINESS LOAN.—For purposes of subsection 
(a), a business loan or debt is a bona fide loan or debt 
made for a business purpose that both parties intended 
be repaid. 
‘‘(c) DETERMINATION OF WORTHLESSNESS.— 
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101 
‘‘(1) IN GENERAL.—No loan or debt shall be 
considered wholly or partially worthless unless it has 
been in arrears for 180 days or more, except that if 
a debt is discharged wholly or partially in bank-
ruptcy before 180 days has elapsed, then it shall be 
deemed wholly or partially worthless on the date of 
discharge. 
‘‘(2) DETERMINATION BY HOLDER.—A loan or 
debt that has been in arrears for 180 days or more 
may be deemed wholly or partially worthless by the 
holder unless a payment schedule has been entered 
into between the debtor and the lender. 
‘‘(d) CROSS REFERENCE.—See section 205(c) for tax 
on subsequent payments. 
‘‘SEC. 803. TIMING OF TAX ON FINANCIAL INTERMEDIATION 
SERVICES. 
‘‘The tax on financial intermediation services pro-
vided by section 801 with respect to an underlying invest-
ment account or debt shall be imposed and collected with 
the same frequency that statements are rendered by the 
financial institution in connection with the investment ac-
count or debt but not less frequently than quarterly. 
‘‘SEC. 804. FINANCING LEASES. 
‘‘(a) DEFINITION.—For purposes of this section, the 
term ‘financing lease’ means any lease under which the 
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