To amend the Internal Revenue Code of 1986 to terminate the tax-exempt status of terrorist supporting organizations.

This bill amends the Internal Revenue Code to terminate the tax-exempt status of organizations that provide material support to terrorist groups. It creates a new category called "terrorist supporting organizations" and establishes a process for the Treasury Secretary to designate them, with a notice and cure period, and allows for administrative and judicial review.

Sec. 1, Termination of tax-exempt status of terrorist supporting organizations: The bill adds a new paragraph to Section 501(p) of the tax code. It defines a "terrorist supporting organization" as one that the Treasury Secretary designates as having provided more than a de minimis amount of material support or resources to a terrorist organization within the past three years. Material support excludes support approved by the State Department and Attorney General or humanitarian aid approved by the Office of Foreign Assets Control. Before designating an organization, the Secretary must send a written notice to its last known address, including the name of the supported organization and a description of the support, unless disclosure would harm national security. The organization then has 90 days to cure the issue by proving it did not provide the support, getting the support returned and certifying it will stop, or, if the description was withheld, filing a court complaint. The Secretary must rescind the designation if it was erroneous, if the organization did not receive the notice and then cures the issue, or if the suspension periods for all supported organizations have ended. Designation disputes can be reviewed by the IRS Independent Office of Appeals, and U.S. district courts have exclusive jurisdiction to review certain determinations, including those involving classified information. The Secretary must also establish policies for handling classified information. This applies to designations made after the bill's enactment.