Title: To amend the Internal Revenue Code of 1986 to provide an exception for certain spun-off voluntary employees' beneficiary associations to the limitation on the exemption from tax on unrelated business taxable income of amounts set aside for qualified benefits.
Policy area: Taxation

Summary:
This bill amends the Internal Revenue Code to exempt certain spun-off voluntary employees' beneficiary associations (VEBAs) from the limitation on the amount of funds that may be set aside for benefits without being subject to the tax on unrelated business income.
The exemption applies if:

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3892 Introduced in House (IH)]

<DOC>






115th CONGRESS
  1st Session
                                H. R. 3892

To amend the Internal Revenue Code of 1986 to provide an exception for 
 certain spun-off voluntary employees' beneficiary associations to the 
  limitation on the exemption from tax on unrelated business taxable 
          income of amounts set aside for qualified benefits.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 28, 2017

 Mrs. Walorski (for herself and Mr. Carson of Indiana) 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 provide an exception for 
 certain spun-off voluntary employees' beneficiary associations to the 
  limitation on the exemption from tax on unrelated business taxable 
          income of amounts set aside for qualified benefits.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. EXCEPTION FROM TAX ON UNRELATED BUSINESS TAXABLE INCOME FOR 
              CERTAIN SPUN-OFF VOLUNTARY EMPLOYEES' BENEFICIARY 
              ASSOCIATIONS.

    (a) In General.--Section 512(a)(3)(E) of the Internal Revenue Code 
of 1986 is amended by adding at the end the following new clause:
                            ``(iv) Certain spun-off voluntary 
                        employees' beneficiary associations.--This 
                        subparagraph shall not apply to any voluntary 
                        employees' beneficiary association described in 
                        section 501(c)(9) for any taxable year if--
                                    ``(I) such organization was 
                                originally established before the date 
                                of the enactment of this clause by an 
                                employer to provide benefits described 
                                in section 501(c)(9) for eligible 
                                employees and retirees and their 
                                dependents and beneficiaries,
                                    ``(II) the only benefits provided 
                                by such organization are post-
                                retirement medical and life benefits,
                                    ``(III) such employer has (before 
                                the beginning of such taxable year) 
                                delegated all authority and 
                                responsibility with respect to such 
                                organization to one or more independent 
                                persons who do not have an employment 
                                relationship with the members entitled 
                                to benefits from such organization,
                                    ``(IV) no member entitled to 
                                benefits from such organization is 
                                entitled to benefits from any other 
                                organization described in section 
                                501(c)(9) as a result of employment 
                                with such employer, and
                                    ``(V) such employer, as of the 
                                close of such taxable year, has no 
                                obligation to make any contribution to 
                                such organization and has not made a 
                                contribution to such organization at 
                                any time during the 11-taxable-year 
                                period ending with such taxable 
                                year.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2017.
                                 <all>