618
PUBLIC LAW 86-344-SEPT. 21, 1959
[73 S T A T.
501(c)(3) which is exempt from income tax under section 501(a), if such school normally maintains a re,2:ular faculty and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on;". (d)
26us1:*4294'
26us%4243*;
EXEMPTION
FOR SERVICES AND FACILITIES
TAXES.—Section
4294(b) of the Internal Revenue Code of 1954 (relating to exemption from certain facilities and services taxes) is amended by adding at the end thereof the following new sentence: "The term also includes a school operated as an activity of an organization described in section 501(c)(3) which is exempt from income tax under section 501(a), if such school normally maintains a r e g u l ^ faculty and curriculum and normally lias a regularly enrolled body of pupils or students in attendance at the place where its educational activities are regularly carried on." (e) EFFECTIVE DATES.—The amendments made by subsections (a), (b), and (d) shall take effect as of January 1, 1959. The amendment made by subsection (c) shall take effect on the first day of the first calendar month which begins more than 10 days after the date of the enactment of this Act. SEC. 3. CERTAIN PAYMENTS FOR CAPITAL IMPROVEMENTS. (ci) EXEMPTION FROM CLUB DUES TAX.—Section 4243(b) of
the
Internal Revenue Code of 1954 (relating to assessments for capital improvements) is amended to read as follows: "(b)
26'^scf424V'
PAYMENTS FOR CAPITAL
IMPROVEMENTS.—Notwithstanding
any other provision of this part, there shall be exempted from the provisions of section 4241 any amount paid as dues or membership fees or as initiation fees— "(1) for the construction or reconstruction of any social, athletic, or sporting facility, or "(2) for the construction or reconstruction of any capital addition to, or capital improvement of, any such facility, or "(3) for furnishings or fixtures (including installation charges) for any such facility, to the extent that such furnishings or fixtures are required, by reason of the construction or reconstruction described in paragraph (1) or (2), for the use of such facility upon completion of such construction or reconstruction; except that, in the case of any such amount which is not expended for such construction, reconstruction, furnishings or fixtures (including installation charges) within 3 years after the date of payment of such amount, the exemption provided by this subsection shall cease to apply upon the expiration of such 3-year period, and the club or organization, rather than the person who made such payment, shall be liable for any tax imposed by section 4241 in respect of such payment, as if such payment had been made on the first day following the expiration of such 3-year period. (^) TECHNICAL. AMENDMENT.—Sectioiv 4241(b) of such Code (relating to who pays club dues tax) is amended by striking out "The" and inserting in lieu thereof "Except as provided in section 4243(b), the". (c) EFFECTIVE DATE.—The amendments made by subsections (a) and (b) shall apply only with respect to amounts paid on or after the first day of the first calendar month which begins more than 10 days after the date of the enactment of this Act for construction or reconstruction of any social, athletic, or sporting facility (or for any capital addition to, or capital improvement of, any such facility) begun on or after January 1, 1959, or for furnishings or fixtures (including installation) required for the use of such facility upon the completion of such construction or reconstruction begun on or after such date.
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