To amend the Internal Revenue Code of 1986 to exclude from gross income amounts received on the sale of animals which are raised and sold as part of an educational program.

June 27, 2005

Mr. PAUL (for himself and Mr. OTTER) introduced the following bill; which was referred to the Committee on Ways and Means

To amend the Internal Revenue Code of 1986 to exclude from gross income amounts received on the sale of animals which are raised and sold as part of an educational program.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Agriculture Education Freedom Act'.

SEC. 2. EXCLUSION FROM GROSS INCOME FOR AMOUNTS RECEIVED ON SALE OF ANIMALS WHICH ARE RAISED AND SOLD AS PART OF EDUCATIONAL PROGRAM.

(a) In General- Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to items specifically excluded from gross income) is amended by inserting after section 139A the following new section:

`SEC. 139B. PROCEEDS OF SALE OF ANIMALS RAISED AND SOLD AS PART OF EDUCATIONAL PROGRAM.

`In the case of an individual, gross income shall not include any gain from the sale of any animal which is raised and sold by such individual as part of such individual's participation in--

`(1) the 4-H program under the Cooperative State Research, Education, and Extension Service of the Department of Agriculture,

`(2) the Future Farmers of America,

`(3) any program of an organization described in section 501(c) and exempt from tax under section 501(a) which is similar to such 4-H program or the Future Farmers of America, or

`(4) any program of an educational organization described in section 170(b)(1)(A)(ii).'.

(b) Clerical Amendment- The table of sections for such part III is amended by inserting after the item relating to section 139 the following new item:

`Sec. 139B. Proceeds of sale of animals raised and sold as part of educational program.'.

(c) Effective Date- The amendments made by this section shall apply to sales in taxable years ending after the date of the enactment of this Act.

END