Us Congress 2025-2026 Regular Session

Us Congress House Bill HB2798 Compare Versions

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Old	New	Differences
1	1	I
2	2	119THCONGRESS
3	3	1
4	4	STSESSION H. R. 2798
5	5	To amend the Internal Revenue Code of 1986 to allow a credit against
6	6	tax for charitable donations for the creation or expansion of charter schools.
7	7	IN THE HOUSE OF REPRESENTATIVES
8	8	APRIL9, 2025
9	9	Ms. T
10	10	ENNEY(for herself, Mr. KILEYof California, Ms. MALLIOTAKIS, and
11	11	Mr. O
12	12	WENS) introduced the following bill; which was referred to the Com-
13	13	mittee on Ways and Means
14	14	A BILL
15	15	To amend the Internal Revenue Code of 1986 to allow a
16	16	credit against tax for charitable donations for the cre-
17	17	ation or expansion of charter schools.
18	18	Be it enacted by the Senate and House of Representa-1
19	19	tives of the United States of America in Congress assembled, 2
20	20	SECTION 1. SHORT TITLE. 3
21	21	This Act may be cited as the ‘‘High-Quality Charter 4
22	22	Schools Act’’. 5
23	23	SEC. 2. TAX CREDIT FOR CONTRIBUTIONS TO ELIGIBLE 6
24	24	CHARTER SCHOOL ORGANIZATIONS. 7
25	25	(a) I
26	26	NGENERAL.—Subpart A of part IV of sub-8
27	27	chapter A of chapter 1 of the Internal Revenue Code of 9
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30	30	•HR 2798 IH
31	31	1986 is amended by inserting after section 25E the fol-1
32	32	lowing new section: 2
33	33	‘‘SEC. 25F. CONTRIBUTIONS TO ELIGIBLE CHARTER 3
34	34	SCHOOL ORGANIZATIONS. 4
35	35	‘‘(a) A
36	36	LLOWANCE OFCREDIT.—In the case of an in-5
37	37	dividual who is a citizen or resident of the United States 6
38	38	(as defined in section 7701(a)(9)), there shall be allowed 7
39	39	as a credit against the tax imposed by this chapter for 8
40	40	the taxable year an amount equal to 75 percent of the 9
41	41	amount of qualified contributions made by the taxpayer 10
42	42	during the taxable year. 11
43	43	‘‘(b) A
44	44	MOUNT OFCREDIT.—The credit allowed under 12
45	45	subsection (a) in any taxable year shall not exceed an 13
46	46	amount equal to the greater of— 14
47	47	‘‘(1) 10 percent of the adjusted gross income of 15
48	48	the taxpayer for the taxable year, or 16
49	49	‘‘(2) $5,000. 17
50	50	‘‘(c) D
51	51	EFINITIONS.—For purposes of this section— 18
52	52	‘‘(1) C
53	53	HARTER SCHOOL .—The term ‘charter 19
54	54	school’ has the same meaning given such term in 20
55	55	section 4310 of the Elementary and Secondary Edu-21
56	56	cation Act of 1965 (20 U.S.C. 7221i). 22
57	57	‘‘(2) E
58	58	LIGIBLE CHARTER SCHOOL ORGANIZA -23
59	59	TION.— 24
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62	62	•HR 2798 IH
63	63	‘‘(A) IN GENERAL.—The term ‘eligible 1
64	64	charter school organization’ means an organiza-2
65	65	tion which— 3
66	66	‘‘(i) is described in section 501(c)(3) 4
67	67	and exempt from tax under section 501(a) 5
68	68	and is not a private foundation, 6
69	69	‘‘(ii) is a charter management organi-7
70	70	zation (as defined in section 4310 of the 8
71	71	Elementary and Secondary Education Act 9
72	72	of 1965 (20 U.S.C. 7221i)), or a charter 10
73	73	school (as defined in section 4310 of the 11
74	74	Elementary and Secondary Education Act 12
75	75	of 1965 (20 U.S.C. 7221i)), that— 13
76	76	‘‘(I) has received, or manages a 14
77	77	charter school that has received, a 15
78	78	grant for the replication or expansion 16
79	79	of high-quality charter schools under 17
80	80	section 4305(b) of the Elementary 18
81	81	and Secondary Education Act of 1965 19
82	82	(20 U.S.C. 7221d(b)), or 20
83	83	‘‘(II) has been selected by a 21
84	84	State for eligibility under this section 22
85	85	based on a determination by the State 23
86	86	that the organization is in the highest 24
87	87	10 percent of charter management or-25
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90	90	•HR 2798 IH
91	91	ganizations (as so defined) or charter 1
92	92	schools (as so defined) for student 2
93	93	performance in the State, 3
94	94	‘‘(iii) separate from any other funds 4
95	95	or contributions received by such organiza-5
96	96	tion, maintains and accounts for any con-6
97	97	tributions made by any person for the pur-7
98	98	pose of the creation or expansion of char-8
99	99	ter schools operated or managed by such 9
100	100	organization, 10
101	101	‘‘(iv) obtains from an independent cer-11
102	102	tified public accountant annual financial 12
103	103	and compliance audits, and 13
104	104	‘‘(v) certifies to the Secretary (at such 14
105	105	time, and in such form and manner, as the 15
106	106	Secretary may prescribe) that the audit de-16
107	107	scribed in clause (iii) has been completed. 17
108	108	‘‘(B) I
109	109	NDEPENDENT CERTIFIED PUBLIC 18
110	110	ACCOUNTANT.—For purposes of subparagraph 19
111	111	(A), the term ‘independent certified public ac-20
112	112	countant’ means, with respect to an organiza-21
113	113	tion, a certified public accountant who is not a 22
114	114	person described in section 465(b)(3)(A) with 23
115	115	respect to such organization or any employee of 24
116	116	such organization. 25
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119	119	•HR 2798 IH
120	120	‘‘(3) QUALIFIED CONTRIBUTION .—The term 1
121	121	‘qualified contribution’ means a charitable contribu-2
122	122	tion (as defined by section 170(c)) to an eligible 3
123	123	charter school organization in the form of cash or 4
124	124	marketable securities for the purpose of the creation 5
125	125	or expansion of charter schools managed or operated 6
126	126	by such organization. 7
127	127	‘‘(d) D
128	128	ENIAL OFDOUBLEBENEFIT.—Any qualified 8
129	129	contribution for which a credit is allowed under this sec-9
130	130	tion shall not be taken into account as a charitable con-10
131	131	tribution for purposes of section 170. 11
132	132	‘‘(e) C
133	133	ARRYFORWARD OF UNUSEDCREDIT.— 12
134	134	‘‘(1) I
135	135	N GENERAL.—If the credit allowable 13
136	136	under subsection (a) for any taxable year exceeds 14
137	137	the limitation imposed by section 26(a) for such tax-15
138	138	able year reduced by the sum of the credits allowable 16
139	139	under this subpart (other than this section, section 17
140	140	23, and section 25D), such excess shall be carried to 18
141	141	the succeeding taxable year and added to the credit 19
142	142	allowable under subsection (a) for such taxable year. 20
143	143	‘‘(2) L
144	144	IMITATION.—No credit may be carried 21
145	145	forward under this subsection to any taxable year 22
146	146	following the fifth taxable year after the taxable year 23
147	147	in which the credit arose. For purposes of the pre-24
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150	150	•HR 2798 IH
151	151	ceding sentence, credits shall be treated as used on 1
152	152	a first-in first-out basis. 2
153	153	‘‘(f) A
154	154	PPLICATION OF VOLUMECAP.—A qualified 3
155	155	contribution shall be taken into account under this section 4
156	156	only if such contribution would not result in aggregate tax 5
157	157	credits under this section that are in excess of the volume 6
158	158	cap established under section 4 of the High-Quality Char-7
159	159	ter Schools Act.’’. 8
160	160	(b) C
161	161	LERICALAMENDMENT.—The table of sections 9
162	162	for subpart A of part IV of subchapter A of chapter 1 10
163	163	of such Code is amended by inserting after the item relat-11
164	164	ing to section 25E the following new item: 12
165	165	‘‘Sec. 25F. Contributions to eligible charter school organizations.’’.
166	166	SEC. 3. FAILURE OF ELIGIBLE CHARTER SCHOOL ORGANI-
167	167	13
168	168	ZATION TO MAKE EXPENDITURES. 14
169	169	(a) I
170	170	NGENERAL.—Chapter 42 of the Internal Rev-15
171	171	enue Code of 1986 is amended by adding at the end the 16
172	172	following new subchapter: 17
173	173	‘‘Subchapter I—Eligible Charter School 18
174	174	Organizations 19
175	175	‘‘Sec. 4969. Failure to expend receipts.
176	176	‘‘SEC. 4969. FAILURE TO EXPEND RECEIPTS.
177	177	20
178	178	‘‘(a) I
179	179	NGENERAL.—In the case of any eligible char-21
180	180	ter school organization (as defined in section 25F(c)(2)) 22
181	181	which has been determined by the Secretary to have failed 23
182	182	to satisfy the requirement under subsection (b) for any 24
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185	185	•HR 2798 IH
186	186	taxable year, any contribution made to such organization 1
187	187	during the first taxable year beginning after the date of 2
188	188	such determination shall not be treated as a qualified con-3
189	189	tribution (as defined in section 25F(c)(3)) for purposes 4
190	190	of section 25F. 5
191	191	‘‘(b) R
192	192	EQUIREMENT.—The requirement described in 6
193	193	this subsection is that the amount of qualified contribu-7
194	194	tions of the eligible charter school organization for the tax-8
195	195	able year which are expended before the expenditure dead-9
196	196	line with respect to such receipts shall not be less than 10
197	197	the required expenditure amount with respect to such tax-11
198	198	able year. 12
199	199	‘‘(c) D
200	200	EFINITIONS.—For purposes of this section— 13
201	201	‘‘(1) R
202	202	EQUIRED EXPENDITURE AMOUNT .— 14
203	203	‘‘(A) I
204	204	N GENERAL.—The required expendi-15
205	205	ture amount with respect to a taxable year is 16
206	206	the amount equal to 100 percent of qualified 17
207	207	contributions for such taxable year— 18
208	208	‘‘(i) reduced by the sum of such quali-19
209	209	fied contributions that are retained for rea-20
210	210	sonable administrative expenses for the 21
211	211	taxable year or are carried to the suc-22
212	212	ceeding taxable year under subparagraph 23
213	213	(C), and 24
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216	216	•HR 2798 IH
217	217	‘‘(ii) increased by the amount of the 1
218	218	carryover under subparagraph (C) from 2
219	219	the preceding taxable year. 3
220	220	‘‘(B) S
221	221	AFE HARBOR FOR REASONABLE AD -4
222	222	MINISTRATIVE EXPENSES .—For purposes of 5
223	223	subparagraph (A)(i), if the percentage of total 6
224	224	qualified contributions to an eligible charter 7
225	225	school organization for a taxable year which are 8
226	226	used for administrative purposes related to ac-9
227	227	tivities for the creation or expansion of charter 10
228	228	schools (as defined in section 25F(c)(1)) oper-11
229	229	ated or managed by such organization is equal 12
230	230	to or less than 10 percent, such expenses shall 13
231	231	be deemed to be reasonable for purposes of 14
232	232	such subparagraph. 15
233	233	‘‘(C) C
234	234	ARRYOVER.—With respect to the 16
235	235	amount of the total qualified contributions to 17
236	236	an eligible charter school organization with re-18
237	237	spect to any taxable year, an amount not great-19
238	238	er than 15 percent of such amount may, at the 20
239	239	election of such organization or school, be car-21
240	240	ried to the succeeding taxable year. 22
241	241	‘‘(2) E
242	242	XPENDITURES.—The term ‘expenditures’ 23
243	243	includes amounts which are formally committed but 24
244	244	not expended. A formal commitment described in the 25
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247	247	•HR 2798 IH
248	248	preceding sentence may include qualified contribu-1
249	249	tions set aside for the creation or expansion of char-2
250	250	ter schools operated or managed by such organiza-3
251	251	tion for more than one year. 4
252	252	‘‘(3) E
253	253	XPENDITURE DEADLINE .—The expendi-5
254	254	ture deadline with respect to qualified contributions 6
255	255	for a taxable year is the first day of the fifth taxable 7
256	256	year following the taxable year in which such quali-8
257	257	fied contributions are received by the eligible charter 9
258	258	school organization. 10
259	259	‘‘(4) Q
260	260	UALIFIED CONTRIBUTIONS .—The term 11
261	261	‘qualified contributions’ means contributions eligible 12
262	262	for the credit under section 25F.’’. 13
263	263	(b) C
264	264	LERICALAMENDMENT.—The table of sub-14
265	265	chapters for chapter 42 of such Code is amended by add-15
266	266	ing at the end the following new item: 16
267	267	‘‘SUBCHAPTER I. ELIGIBLE CHARTER SCHOOL ORGANIZATIONS ’’.
268	268	SEC. 4. VOLUME CAP.
269	269	17
270	270	(a) A
271	271	LLOCATION.— 18
272	272	(1) I
273	273	N GENERAL.—For purposes of section 19
274	274	25F(f) of the Internal Revenue Code of 1986 (as 20
275	275	added by this Act), the volume cap applicable with 21
276	276	respect to such section shall be $5,000,000,000 of 22
277	277	tax credits for taxable years beginning in calendar 23
278	278	year 2026 and each subsequent year thereafter, with 24
279	279	such amount to be allocated as follows: 25
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282	282	•HR 2798 IH
283	283	(A) $10,000,000 of tax credits shall be al-1
284	284	located to each State (as defined in section 2
285	285	7701(a)(10) of the Internal Revenue Code of 3
286	286	1986), with such amount to be made available, 4
287	287	in the manner described in subsection (b), for 5
288	288	any individual residing in such State to claim 6
289	289	the credit allowed under section 25F of the In-7
290	290	ternal Revenue Code of 1986 with respect to 8
291	291	any qualified contributions (as defined in such 9
292	292	section) made by such individual during any 10
293	293	taxable year beginning during such calendar 11
294	294	year. 12
295	295	(B) With respect to the amount remaining 13
296	296	after the allocation under subparagraph (A), 14
297	297	such amount (as adjusted pursuant to para-15
298	298	graph (3)) shall be made available, in the man-16
299	299	ner described in subsection (b), for any indi-17
300	300	vidual to claim the credit allowed under section 18
301	301	25F of the Internal Revenue Code of 1986 with 19
302	302	respect to any qualified contributions made by 20
303	303	such individual during any taxable year begin-21
304	304	ning during such calendar year. 22
305	305	(2) C
306	306	ARRYOVER.—The amount of any allotment 23
307	307	to a State under paragraph (1)(A) for any calendar 24
308	308	year which is not claimed by taxpayers described in 25
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311	311	•HR 2798 IH
312	312	such paragraph during such calendar year shall be 1
313	313	added to the allotment provided under paragraph 2
314	314	(1)(B) for the subsequent calendar year. 3
315	315	(3) I
316	316	NCREASE IN NATIONWIDE VOLUME CAP .— 4
317	317	For purposes of paragraph (1)(B), if the Secretary 5
318	318	determines during any calendar year that the 6
319	319	amount of tax credits allowable under section 25F 7
320	320	with respect to qualified contributions made during 8
321	321	such calendar year is equal to or greater than 90 9
322	322	percent of the total amount made available under 10
323	323	such paragraph for such calendar year, such amount 11
324	324	shall be increased by an amount equal to 5 percent 12
325	325	of the total amount made available under such para-13
326	326	graph as of January 1 of such calendar year, with 14
327	327	such increase to remain in effect for the subsequent 15
328	328	calendar year. 16
329	329	(b) F
330	330	IRST-COME, FIRST-SERVE.—For purposes of 17
331	331	applying the volume cap under this section, such volume 18
332	332	cap shall be applied based on a first-come, first-serve 19
333	333	basis, as determined based on the date on which the tax-20
334	334	payer made the qualified contribution. 21
335	335	(c) R
336	336	EAL-TIMEINFORMATION.—For purposes of this 22
337	337	section, the Secretary of the Treasury (or the Secretary’s 23
338	338	delegate) shall develop a system to track the amount of 24
339	339	qualified contributions made during the calendar year for 25
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342	342	•HR 2798 IH
343	343	which a credit may be claimed under section 25F of the 1
344	344	Internal Revenue Code of 1986, with such information to 2
345	345	be updated in real time. 3
346	346	SEC. 5. ORGANIZATIONAL AND PARENTAL AUTONOMY. 4
347	347	(a) P
348	348	ROHIBITION OF CONTROLOVERELIGIBLE 5
349	349	C
350	350	HARTERSCHOOLORGANIZATIONS.— 6
351	351	(1) I
352	352	N GENERAL.—An eligible charter school or-7
353	353	ganization shall not, by virtue of participation under 8
354	354	any provision of this Act or any amendment made 9
355	355	by this Act, be regarded as acting on behalf of any 10
356	356	governmental entity. 11
357	357	(2) M
358	358	AXIMUM FREEDOM .—To the extent per-12
359	359	missible by law, this Act, and any amendment made 13
360	360	by this Act, shall be construed to allow eligible char-14
361	361	ter school organizations maximum freedom to pro-15
362	362	vide for the needs of the students served by the 16
363	363	charter schools operated or managed by the organi-17
364	364	zation without governmental control. 18
365	365	(b) D
366	366	EFINITIONS.—For purposes of this section, the 19
367	367	terms ‘‘charter school’’ and ‘‘eligible charter school organi-20
368	368	zation’’ shall have the same meanings given such terms 21
369	369	under section 25F(c) of the Internal Revenue Code of 22
370	370	1986 (as added by section 2(a) of this Act). 23
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373	373	•HR 2798 IH
374	374	SEC. 6. EFFECTIVE DATE. 1
375	375	The amendments made by this Act shall apply to tax-2
376	376	able years beginning after December 31, 2025. 3
377	377	Æ
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