Fallen Firefighters Assistance Tax Clarification Act of 2006

Fallen Firefighters Assistance Tax Clarification Act of 2006 - Treats payments made before June 1, 2007, by a charitable organization by reason of the death, injury, wounding, or illness of any firefighter in the October 2006 Esperanza Incident in southern California as related to such organization’s exempt function (and thus tax-exempt) if such payments are made in good faith using a reasonable and objective formula which is consistently applied. Protects private foundation making such payments from the penalty tax on self-dealing.

Excludes payments for firefighters made by charities or foundations under this Act (or by federal, state, or local governments) from the gross income of the recipient.

[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 4112 Introduced in Senate (IS)]








109th CONGRESS
  2d Session
                                S. 4112

 To treat payments by charitable organizations with respect to certain 
                    firefighters as exempt payments.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            December 8, 2006

Mrs. Feinstein (for herself, Mrs. Boxer, and Mr. Craig) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
 To treat payments by charitable organizations with respect to certain 
                    firefighters as exempt payments.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fallen Firefighters Assistance Tax 
Clarification Act of 2006''.

SEC. 2. PAYMENTS BY CHARITABLE ORGANIZATIONS WITH RESPECT TO CERTAIN 
              FIREFIGHTERS TREATED AS EXEMPT PAYMENTS AND EXCLUDED FROM 
              GROSS INCOME OF THE RECIPIENTS.

    (a) In General.--For purposes of the Internal Revenue Code of 
1986--
            (1) payments made by an organization described in section 
        501(c)(3) of such Code by reason of the death, injury, 
        wounding, or illness of any firefighter incurred as the result 
        of the October 2006 Esperanza Incident fire in southern 
        California, and before June 1, 2007, shall be treated as 
        related to the purpose or function constituting the basis for 
        such organization's exemption under section 501 of such Code if 
        such payments are made in good faith using a reasonable and 
        objective formula which is consistently applied;
            (2) in the case of a private foundation (as defined in 
        section 509 of such Code), any payment described in paragraph 
        (1) shall not be treated as made to a disqualified person for 
        purposes of section 4941 of such Code; and
            (3) the receipt of any payment described in paragraphs (1) 
        or (2), or any payment from any Federal, State, or local 
        government, or agency or instrumentality thereof, by reason of 
        the death, injury, wounding, or illness of any firefighter 
        incurred as the result of the October 2006 Esperanza Incident 
        fire in southern California, shall not be treated as gross 
        income under such Code.
    (b) Effective Date.--This section shall apply to payments made on 
or after October 26, 2006.
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