HR7286-119

What This Bill Does

This bill amends Internal Revenue Code section 501 to deny tax exemption to any organization that provides or provides funding for abortion, and it also says such an organization is not treated as described in section 170(c), which affects charitable contribution treatment. The bill defines abortion broadly as using or prescribing an instrument, medicine, drug, substance, or device to intentionally kill an unborn child or intentionally terminate a known pregnancy, except when the intent after viability is live birth and preserving the born child's life and health, or removing a dead unborn child. The revocation rule does not apply when an abortion is necessary to save the life of the mother or when the pregnancy resulted from rape or incest. The rule applies to taxable years beginning after enactment.

Who Benefits and How

Anti-abortion organizations and donors who oppose tax support for abortion providers benefit because the bill removes federal tax-exempt and charitable status from organizations that provide or fund abortion outside the stated exceptions. Federal revenue collections may benefit if affected organizations become taxable or lose deductible contribution treatment. Competing nonprofits that do not provide or fund abortion may benefit comparatively because their tax-exempt status remains intact.

Who Bears the Burden and How

Abortion providers, abortion funds, reproductive-health nonprofits, and other tax-exempt organizations that provide or fund abortion would lose exemption and section 170(c) treatment unless their activity falls within the life-of-the-mother, rape, or incest exceptions. Donors to affected organizations may lose charitable deduction treatment. The IRS must determine which organizations provide or fund abortion, apply the new definition and exceptions, and enforce the rule for taxable years after enactment. Patients may face reduced services if affected nonprofits lose funding or tax benefits.

Key Provisions

• Revokes section 501 tax-exempt status for organizations that provide or fund abortion.
• Removes section 170(c) charitable contribution treatment for organizations covered by the abortion funding rule.
• Provides exceptions for abortions necessary to save the mother's life or pregnancies resulting from rape or incest.
• Applies the tax-exemption change to taxable years beginning after enactment.