H.R. 2945 – Reading Mode

113th CONGRESS

1st Session

H. R. 2945

IN THE HOUSE OF REPRESENTATIVES

August 1, 2013

Mr. Levin (for himself and Mr. Gerlach) 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 permanently extend and expand the charitable deduction for contributions of food inventory.

Extension and expansion of charitable deduction for contributions of food inventory

(a)

Permanent extension

Subparagraph (C) of section 170(e)(3) of the Internal Revenue Code of 1986 is amended by striking clause (iv).

(b)

Determination of basis for taxpayers other than C corporations

Subparagraph (C) of section 170(e)(3) of such Code, as amended by subsection (a), is amended by adding at the end the following new clause:

(iv)

Determination of basis for taxpayers other than C corporations

If a taxpayer—

(I)

does not account for inventories under section 471, and

(II)

is not required to capitalize indirect costs under section 263A,

the taxpayer may elect, solely for purposes of subparagraph (B), to treat the basis of any apparently wholesome food as being equal to 25 percent of the fair market value of such food.

(c)

Determination of fair market value

Subparagraph (C) of section 170(e)(3) of such Code, as amended by subsections (a) and (b), is amended by adding at the end the following new clause:

(v)

Determination of fair market value

In the case of any such contribution of apparently wholesome food which, solely by reason of internal standards of the taxpayer, lack of market, or similar circumstances, or which is produced by the taxpayer exclusively for the purposes of transferring the food to an organization described in subparagraph (A), cannot or will not be sold, the fair market value of such contribution shall be determined—

(I)

without regard to such internal standards, such lack of market, such circumstances, or such exclusive purpose, and

(II)

by taking into account the price at which the same or substantially the same food items (as to both type and quality) are sold by the taxpayer at the time of the contribution (or, if not so sold at such time, in the recent past).

(d)

Limitation

(1)

Increase in percentage

Clause (ii) of section 170(e)(3)(C) of such Code is amended by striking 10 percent and inserting 15 percent.

(2)

Applicability to C corporations

(A)

In general

Clause (ii) of section 170(e)(3)(C) of such Code is amended by striking In the case of a taxpayer other than a C corporation, the and inserting The.

(B)

Coordination with limitation

Paragraph (3) of section 170(b) of such Code is amended to read as follows:

(3)

Charitable contributions of food

For purposes of paragraph (2)(A)—

(A)

In general

Any charitable contribution of food to which subsection (e)(3)(C) applies shall be allowed to the extent the aggregate of such contributions does not exceed the limitation under subsection (e)(3)(C)(ii).

(B)

Carryover

If the aggregate amount of contributions described in subparagraph (A) exceeds such limitation, such excess shall be treated (in a manner consistent with the rules of subsection (d)) as a charitable contribution to which subparagraph (A) applies in each of the 5 succeeding years in order of time.

(e)

Effective Date

The amendments made by this section shall apply to contributions made after the date of the enactment of this Act, in taxable years ending after such date.