I 118th CONGRESS 1st Session H. R. 6408 IN THE HOUSE OF REPRESENTATIVES November 14, 2023 Mr. Kustoff (for himself and Mr. Schneider ) 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 terminate the tax-exempt status of terrorist supporting organizations.

1. Termination of tax-exempt status of terrorist supporting organizations (a) In general Section 501(p) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: (8) Application to terrorist supporting organizations (A) In general For purposes of this subsection, in the case of any terrorist supporting organization— (i) such organization (and the designation of such organization under subparagraph (B)) shall be treated as described in paragraph (2), and (ii) the period of suspension described in paragraph (3) with respect to such organization shall be treated as beginning on the date that the Secretary designates such organization under subparagraph (B) and ending on the date that the Secretary rescinds such designation under subparagraph (D). (B) Terrorist supporting organization For purposes of this paragraph, the term terrorist supporting organization means any organization which is designated by the Secretary as having provided, during the 3-year period ending on the date of such designation, material support or resources (within the meaning of section 2339B of title 18, United States Code) to an organization described in paragraph (2) (determined after the application of this paragraph to such organization) in excess of a de minimis amount. (C) Designation procedure (i) Notice requirement Prior to designating any organization as a terrorist supporting organization under subparagraph (B), the Secretary shall mail to the most recent mailing address provided by such organization on the organization’s annual return under section 6033 (or subsequent form indicating a change of address) a written notice which includes— (I) a statement that the Secretary will designate such organization as a terrorist supporting organization unless the organization satisfies the requirements of subclause (I) or (II) of clause (ii), (II) the name of the organization or organizations with respect to which the Secretary has determined such organization provided material support or sources as described in subparagraph (B), and (III) a description of such material support or resources. (ii) Opportunity to cure In the case of any notice provided to an organization under clause (i), the Secretary shall, at the close of the 90-day period beginning on the date that such notice was sent, designate such organization as a terrorist organization under subparagraph (B) if (and only if) such organization has not (during such period)— (I) demonstrated to the satisfaction of the Secretary that such organization did not provide the material support or resources referred to in subparagraph (B), or (II) made reasonable efforts to have such support or resources returned to such organization and certified in writing to the Secretary that such organization will not provide any further support or resources to organizations described in paragraph (2). A certification under subclause (II) shall not be treated as valid if the organization making such certification has provided any other such certification during the preceding 5 years. (D) Rescission The Secretary shall rescind a designation under subparagraph (B) if (and only if)— (i) the Secretary determines that such designation was erroneous, (ii) after the Secretary receives a written certification from an organization that such organization did not receive the notice described in subparagraph (C)(i)— (I) the Secretary determines that it is reasonable to believe that such organization did not receive such notice, and (II) such organization satisfies the requirements of subclause (I) or (II) of subparagraph (C)(ii) (determined after taking into account the last sentence thereof), or (iii) the Secretary determines, with respect to all organizations to which the material support or resources referred to in subparagraph (B) were provided, the periods of suspension under paragraph (3) have ended. A certification described in the matter preceding subclause (I) of clause (II) shall not be treated as valid if the organization making such certification has provided any other such certification during the preceding 5 years. . (b) Effective date The amendment made by this section shall apply to designations made after the date of the enactment of this Act in taxable years ending after such date.