Page:United States Statutes at Large Volume 90 Part 2.djvu/253

 PUBLIC LAW 94-455—OCT. 4, 1976

9 0 STAT. 1721

tion and which, for the taxable year which includes the date the election is made, is described in subsection (c)(3) and— " (A) is described in paragraph (4), and " (B) is not a disqualified organization under paragraph (5). "(4)

ORGANIZATIONS PERMITI'ED TO ELECT TO HAVE THIS SUB-

SECTION APPLY.—An organization is described in this paragraph if it is described in— " (A) section 170(b)(1)(A) (ii) (relating to educational institutions), " (B) section 1 7 0 (b)(1)(A) (iii) ( r e l a t i n g to hospitals and medical research organizations), " (C) section 1 7 0 (b)(1)(A) (iv) (relating to organizations supporting government schools), " (D) section 170(b)(1)(A) (vi) (relating to organizations publicly supported by charitable contributions), " (E) section 509(a)(2) ( r e l a t i n g to organizations publicly supported by admissions, sales, etc.), or " (F) section 5 0 9 (a)(3) (relating to organizations supp o r t i n g certain types of public charities) except that for purposes of this subparagraph, section 5 0 9 (a)(3) shall be applied without regard to the last sentence of section 509(a). "(5)

DISQUALIFIED ORGANIZATIONS.—For purposes of paragraph

(3) an organization is a disqualified organization if it is— " (A) described in section 170(b)(1)(A)(i) (relating to churches), " (B) an integrated auxiliary of a church or of a convention or association of churches, or " (C) a member of an affiliated group of organizations (within the meaning of section 4911(f)(2)) if one or more Post, p.l723. members of such group is described in subparagraph (A) or (B). "(6)

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YEARS FOR W H I C H ELECTION IS EFFECTIVE.—An election

by an organization under this subsection shall be effective for all taxable years of such organization which— " (A) end after the date the election is made, and " (B) begin before the date the election is revoked by such Regulations, organization (under regulations prescribed by the Secretary). "(7)

No EFFECT ON CERTAIN ORGANIZATIONS.—With respect to

any organization for a taxable year for which— " (A) such organization is a disqualified organization (within the meaning of paragraph (5)), or " (B) an election under this subsection is not in effect for such organization, nothing in this subsection or in section 4911 s' all bo construed to affect the interpretation of the phrase, 'no substantial part of the activities of which is carrying on propaganda, or otherwise attempting, to influence legislation,' under subsection (c)(3). " (8) AFFILIATED ORGANIZATIONS.—

"For rules regarding affiliated organizations, see section 4911(f).". (2) STATUS OF ORGANIZATION W H I C H CEASES TO QUALIFY FOR 26 USC 504. E X E M P T I O N U N D E R SECTION 5 0 1 (C)(3) BECAUSE OF S U B S T A N T I A L

LOBBYING.—Part I of subchapter F of chapter 1 (relating to general rules as to exempt organizations) is amended by adding at the end thereof the following new section:

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