Section 1 Short title
This Act may be cited as the “Preserving Charitable Incentives Act”.
Preserving Charitable Incentives Act
A BILL
To provide incentives to make charitable contributions of certain inventory.
Sec. 2 Incentives to make charitable contributions of certain inventory
Temporary increase in limitation on qualified contributions—
Suspension of current limitation— Except as otherwise provided in paragraph (2), qualified contributions shall be disregarded in applying subsections (b)(2), (d), and (e)(3)(C)(ii) of section 170 of the Internal Revenue Code of 1986.
Application of increased limitation— For purposes of section 170 of the Internal Revenue Code of 1986—
Limitation— Any qualified contribution shall be allowed as a deduction only to the extent that the aggregate of such contributions does not exceed the excess of the taxpayer’s taxable income (as determined under paragraph (2) of section 170(b) of such Code) over the amount of all other charitable contributions allowed under such paragraph.
Carryover— If the aggregate amount of qualified contributions made in the contribution year (within the meaning of section 170(d)(2) of such Code) exceeds the limitation of subparagraph (A), such excess shall be appropriately taken into account under section 170(b)(2) of such Code subject to the limitations thereof.
Carryover of food inventory contributions— If the aggregate amount of qualified contributions described in section 170(e)(3)(C)(i) of such Code made in such contribution year exceeds the limitation of subparagraph (A), such excess shall be appropriately taken into account under section 170(e)(3)(C)(iii) of such Code subject to the limitations thereof, and the application of subparagraph (B) shall be adjusted accordingly.
Qualified contributions— For purposes of this subsection, the term qualified contribution means any qualified contribution (as defined in section 170(e)(3)(A) of the Internal Revenue Code of 1986) which—
is made during a taxable year of the corporation which begins during 2020 or 2021, and
does not consist of any drug or biological product that requires a prescription of a physician for its use by an individual.
Election— A contribution shall be taken into account as a qualified contribution for purposes of this subsection only if the corporation elects (at such time and in such manner as the Secretary may provide) the application of this subsection with respect to such contribution.
Election To treat qualified contributions as made in prior taxable year— In the case of any qualified contribution (as defined in subsection (a)(3) and determined without regard to this subsection) made during the corporation’s first taxable year beginning in 2020 with respect to which the corporation elects (as such time and in such manner as the Secretary may provide) the application of this subsection—
such contribution shall be treated as made in the taxable year preceding such taxable year (and not in such taxable year), and
such contribution shall not be treated as a qualified contribution for purposes of subsection (a).
Clarification of treatment of inventory costs— The Secretary of the Treasury, or the Secretary’s designee, shall clarify, though a notice or other administrative guidance, the treatment of inventory costs as cost of goods sold for purposes of section 170 of the Internal Revenue Code of 1986.