Qualified general contributions to health savings accounts

(a) In general Section 223 of the Internal Revenue Code of 1986, as amended by the preceding provisions of this Act, is amended— (1) in subsection (c)(1)(A), by inserting or a qualified general contribution, after section 220(f)(5),, and (2) in subsection (e)— (A) in paragraph (3)(B), by inserting, or a qualified general contribution after section 220(f)(5), and (B) by adding at the end the following new paragraph: (9) Qualified general contribution For purposes of this section— (A) In general The term qualified general contribution means any contribution which— (i) is made by the Secretary pursuant to a general funding contribution, (ii) is made to the health savings account of an account beneficiary in the qualified class of account beneficiaries specified in the general funding contribution, and (iii) is in an amount which is equal to the ratio of— (I) the amount of such general funding contribution, to (II) the number of account beneficiaries in such qualified class. (B) General funding contribution The term general funding contribution means a contribution which— (i) is made by— (I) an entity described in section 170(c)(1) (other than a possession of the United States or a political subdivision thereof) or an Indian tribal government, or (II) an organization described in section 501(c)(3) and exempt from tax under section 501(a), and (ii) which specifies a qualified class of account beneficiaries to whom such contribution is to be distributed. (C) Qualified class (i) In general The term qualified class means any of the following: (I) All account beneficiaries. (II) All account beneficiaries who reside in one or more States or other qualified geographic areas specified by the terms of the general funding contribution. (ii) Qualified geographic area The term qualified geographic area means any geographic area in which not less than 5,000 account beneficiaries reside and which is designated by the Secretary as a qualified geographic area under this clause.. (b) Exclusion from gross income (1) In general Part III of subchapter B of chapter 1 of such Code is amended by inserting before section 140 the following new section: 139M. Qualified general contributions to health savings accounts (a) In general Gross income of an account beneficiary shall not include any qualified general contribution to a health savings account of the account beneficiary. (b) Definitions Any term used in this section which is used in section 223 shall have the meaning given such term under section 223.. (2) Clerical amendment The table of sections for part III of subchapter B of chapter 1 of such Code is amended by inserting before the item relating to section 140 the following new item: Sec. 139M. Qualified general contributions to health savings accounts.. (c) Effective date The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.