To amend the Internal Revenue Code of 1986 to require disclosure of lobbying activities by certain organizations.

Summary: Stealth Lobbyist Disclosure Act of 2004 - Amends the Internal Revenue Code to treat as a tax-exempt political organization for purposes of the disclosure and other requirements applicable to such organizations (with certain modifications) any coalition or association that is identified as a client on any registration filed under the Lobbying Disclosure Act of 1995 and that is not a political organization.

Requires any such coalition or association to notify the Secretary of the Treasury of: (1) its existence within 72 hours after one of its lobbyists makes an initial contact; and (2) any change in membership within 72 hours. Requires such notice to include a general description of the business or activities of each member of the coalition or association and the amount reasonably expected to be contributed by each member toward coalition or association activities of influencing legislation. Imposes a penalty tax for failure to give required notices.

Exempts from the disclosure requirements imposed by this Act: (1) public charities and other tax-exempt organizations which have substantial exempt activities other than lobbying; and (2) members of a coalition or association who contribute less than $2,000 per year for lobbying activities.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Stealth Lobbyist Disclosure Act of 
2004''.

SEC. 2. DISCLOSURE OF LOBBYING ACTIVITIES BY CERTAIN ORGANIZATIONS.

    (a) In General.--Section 527 of the Internal Revenue Code of 1986 
(relating to political organizations) is amended by adding at the end 
the following new subsection:
    ``(m) Disclosure of Certain Lobbying Activities.--
            ``(1) In general.--In the case of a coalition or 
        association that is identified as a client on any registration 
        filed under section 4 of the Lobbying Disclosure Act of 1995 
        and that is not a political organization (determined without 
        regard to this paragraph)--
                    ``(A) such coalition or association shall be 
                treated for purposes of this title as a separate entity 
                which is a political organization, and
                    ``(B) this section shall be applied to such 
                coalition or association with the following 
                modifications:
                            ``(i) The function of conducting lobbying 
                        activities (as defined in section 3(7) of the 
                        Lobbying Disclosure Act of 1995) shall be 
                        treated as its exempt function.
                            ``(ii) The specific deduction under 
                        subsection (c)(2)(A) shall not be allowed.
                            ``(iii) Subparagraphs (C) and (D) of 
                        subsection (c)(3) shall not apply.
                            ``(iv) The disclosure requirements of 
                        paragraph (2) shall apply in lieu of the 
                        requirements of subsections (i) and (j).
        For purposes of subparagraph (B)(i), lobbying activities shall 
        not include any activity described in subparagraph (C), (D), or 
        (E) of section 4911(d)(2).
            ``(2) Disclosure requirements.--
                    ``(A) Establishment.--A coalition or association 
                which is treated under paragraph (1) as a political 
                organization shall notify the Secretary, electronically 
                and in writing, of its existence. Such notice shall be 
                transmitted not later than 72 hours after a lobbyist 
                first makes a lobbying contact (or, if earlier, is 
                employed or retained to make a lobbying contact) on 
                behalf of such coalition or association. For purposes 
                of the preceding sentence, the terms `lobbyist' and 
                `lobbying contact' have the respective meanings given 
                to such terms by section 3 of the Lobbying Disclosure 
                Act of 1995.
                    ``(B) Change in membership.--A coalition or 
                association which is required to provide a notice to 
                the Secretary under paragraph (1) shall also notify the 
                Secretary, electronically and in writing, of any change 
                in its membership since its prior required notice under 
                this paragraph. Such notice shall be transmitted not 
                later than 72 hours after the date of the membership 
                change.
            ``(3) Contents of notice.--
                    ``(A) Initial notice.--Each notice required under 
                paragraph (2)(A) shall include information regarding--
                            ``(i) the name, address, business telephone 
                        number, and principal place of business of each 
                        of the members of the coalition or association,
                            ``(ii) a general description of the 
                        business or activities of each of such members, 
                        and
                            ``(iii) the amount reasonably expected to 
                        be contributed by each of such members toward 
                        the activities of the coalition or association 
                        of influencing legislation.
                    ``(B) Notice of membership change.--Each notice 
                required under paragraph (2)(B) shall include--
                            ``(i) if the notice relates to a new member 
                        of the coalition or association, the 
                        information described in subparagraph (A) with 
                        respect to such new member, and
                            ``(ii) if the notice relates to the 
                        cessation of a person's membership, the name of 
                        such person.
            ``(4) Effect of failure.--
                    ``(A) In general.--In the case of--
                            ``(i) a failure to give the notice required 
                        under paragraph (2) at the time and in the 
                        manner prescribed therefor, or
                            ``(ii) a failure to include any of the 
                        information required to be included in such 
                        notice or to show the correct information,
                there shall be paid by the coalition or association an 
                amount equal to the rate of tax specified in subsection 
                (b)(1) multiplied by the amount involved.
                    ``(B) Amount involved.--For purposes of 
                subparagraph (A), the amount involved with respect to 
                any failure is--
                            ``(i) in the case of a failure to file the 
                        notice under paragraph (2)(A) at the time and 
                        in the manner prescribed therefor, the amount 
which is reasonably expected to be paid by the coalition or association 
or its members to the person filing the registration statement, and
                            ``(ii) in the case of a failure to include 
                        any of the information required to be included 
                        in such notice, or to show the correct 
                        information, with respect to any member, the 
                        amount reasonably expected to be contributed by 
                        such member toward the activities of the 
                        coalition or association of influencing 
                        legislation.
                    ``(C) Joint and several liability.--All members of 
                the coalition or association shall be jointly and 
                severally liable under this paragraph for any failure.
                    ``(D) Procedures for assessment and collection of 
                penalty.--For purposes of subtitle F, the penalty 
                imposed by this paragraph shall be assessed and 
                collected in the same manner as penalties imposed by 
                section 6652(c).
            ``(5) Exception for certain tax-exempt associations.--This 
        subsection shall not apply to any association--
                    ``(A) which is described in section 501(c)(3) and 
                exempt from tax under section 501(a), or
                    ``(B)(i) which is described in any other paragraph 
                of section 501(c) and exempt from tax under section 
                501(a), and
                    ``(ii) which has substantial exempt activities 
                other than lobbying with respect to the specific issue 
                for which it engaged the person filing the registration 
                statement under section 4 of the Lobbying Disclosure 
                Act of 1995.
        The preceding sentence shall not apply to any association 
        formed or availed of to avoid the purposes of this subsection.
            ``(6) Exception from disclosure for certain members.--
                    ``(A) In general.--Information on a member of a 
                coalition or association need not be included in any 
                notice under paragraph (3) if the amount referred to in 
                paragraph (3)(A)(iii) with respect to such member is 
                less than $2,000 per year.
                    ``(B) Expenditures in excess of expected amount.--
                If--
                            ``(i) information on a member of a 
                        coalition or association is not included in any 
                        notice by reason of subparagraph (A), and
                            ``(ii) the amount contributed by such 
                        member toward the activities of the coalition 
                        or association of influencing legislation 
                        exceeds $2,200 per year,
                such member shall be treated for purposes of this 
                subsection as a new member of such coalition or 
                association as of the earliest date that clause (ii) is 
                met.
            ``(7) Look-thru rules.--In the case of a coalition or 
        association which is treated as a political organization under 
        paragraph (1)--
                    ``(A) such coalition or association shall be 
                treated as employing or retaining other persons to 
                conduct lobbying activities for purposes of determining 
                whether any individual member thereof is treated as a 
                political organization under paragraph (1), and
                    ``(B) information on such coalition or association 
                need not be included in any notice under paragraph (2) 
                of the coalition or association with respect to which 
                it is treated as a political organization under 
                paragraph (1).''.
    (b) Public Disclosure of Notices.--
            (1) In general.--Paragraph (1) of section 527(k) of such 
        Code is amended by inserting ``or (m)(2)'' after ``(i)(1)''.
            (2) Access.--Paragaraph (2) of section 527(k) of such Code 
        is amended by inserting after subparagraph (G) the following 
        new subparagraph:
                    ``(H) The organizations which file a notice under 
                subsection (m).''.
    (c) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply to--
                    (A) coalitions and associations listed on 
                registration statements filed under section 4 of the 
                Lobbying Disclosure Act of 1995 after the date of the 
                enactment of this Act, and
                    (B) coalitions and associations for whom any 
                lobbying contact is made after the date of the 
                enactment of this Act.
            (2) Special rule.--In the case of any coalition or 
        association to which the amendments made by this Act apply by 
        reason of paragraph (1)(B), the time to file the notice under 
        section 527(k)(2) of the Internal Revenue Code of 1986, as 
        added by this section, shall be 30 days after the date of the 
        enactment of this section.