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.

Bill: 115-hr-3892
Sponsor: full_name: Rep. Walorski, Jackie [R-IN-2]
Introduced: 2017-09-28
Policy area: Taxation
Subjects: Employee benefits and pensions

Health care costs and insurance

Income tax rates

Tax-exempt organizations
Latest action: action_date: 2017-09-28
text: Referred to the House Committee on Ways and Means.

Summaries:
action_date: 2017-09-28
action_desc: Introduced in House
text: <p>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. </p> <p>The exemption applies if: </p> <ul> <li> the VEBA was originally established prior to the enactment of this bill by an employer to provide benefits for eligible employees, retirees, and their dependents and beneficiaries;</li> <li> the benefits are limited to post-retirement medical and life benefits;</li> <li> the employer has delegated (before the beginning of the tax year) all authority and responsibility for the VEBA to one or more independent persons who do not have an employment relationship with the members entitled to benefits from the VEBA; </li> <li> no member entitled to benefits from the VEBA is entitled to benefits from any other VEBA as a result of employment with the employer; and </li> <li> the employer has no obligation to make contributions to the VEBA and has not contributed during the 11-year period ending with the tax year. </li> </ul>

tv_txt: I 115th CONGRESS 1st Session H. R. 3892 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.

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.