S. 4881: Unlocking Low-Income Taxpayer Clinic Funding Act

This bill would change the rules for federal grants to low-income taxpayer clinics, which are organizations that help people with low incomes resolve tax problems with the IRS.

What would change

• Under current law, clinics that receive these grants must provide matching funds of a certain amount.
• This bill would make it easier to count some clinic resources toward that match.
• Specifically, matching funds could include:
  • the salaries and fringe benefits of staff who work for the clinic, and
  • the cost of equipment used by the clinic.
• It would not allow indirect costs, such as general overhead expenses of the sponsoring institution, to count as matching funds.

Match amount

• The bill would set the matching requirement at 100% of the grant amount by default.
• However, the Treasury Secretary would be allowed to set a lower matching percentage, but not below 25%, if doing so would help expand clinic coverage to more taxpayers.

Administrative changes

• The bill also makes technical updates to the Internal Revenue Code to fit the revised matching-funds rules.
• The changes would apply to calendar years beginning after the bill becomes law.

Relevant Companies

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