I

106TH CONGRESS

2D SESSION H. R. 5277

To amend the Internal Revenue Code of 1986 to avoid duplicate reporting

of information on political activities of certain State and local political

organizations, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

SEPTEMBER 25, 2000

Mr. DOGGETT (for himself, Mr. STARK, Mr. MATSUI, Mr. LEVIN, Mr. CARDIN,

Mr. MCDERMOTT, Mr. LEWIS of Georgia, Mr. NEAL of Massachusetts,

Mr. MCNULTY, Mr. MOORE, Mr. FARR of California, Mr. TIERNEY, Mr.

LANTOS, Mrs. THURMAN, Mr. OLVER, Mr. NADLER, Mr. GREEN of

Texas, Mr. BENTSEN, Mr. CROWLEY, Mr. WEINER, and Ms. SLAUGHTER) introduced the following bill; which was referred to the Committee

on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to avoid duplicate reporting of information on political activities of

certain State and local political organizations, and for

other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. MODIFICATION OF REPORTING OF POLITICAL

4 ACTIVITIES.

5 (a) REQUIRED NOTIFICATION OF STATUS AS SEC6 TION 527 ORGANIZATION NOT TO APPLY TO CERTAIN
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1 STATE AND LOCAL POLITICAL ORGANIZATIONS.—Sub2 section (i) of section 527 of the Internal Revenue Code

3 of 1986 (relating to organizations which must notify Sec4 retary that they are section 527 organizations) is amended

5 by adding at the end the following new paragraph:

6 ‘‘(7) EXCEPTION FOR STATE AND LOCAL POLIT7 ICAL ORGANIZATIONS.—This subsection shall not

8 apply to any organization if—

9 ‘‘(A) such organization is organized and

10 operated exclusively for the purpose of influ11 encing or attempting to influence the selection,

12 nomination, election, or appointment of any in13 dividual to any State or local public office, and

14 ‘‘(B) such organization is required to make

15 a filing, which is publicly available, with a State

16 agency containing substantially the same infor17 mation as is required under this subsection.’’

18 (b) CERTAIN STATE AND LOCAL POLITICAL ORGANI19 ZATIONS NOT REQUIRED TO FILE DUPLICATIVE RE20 PORTS.—Subsection (j) of section 527 of such Code (relat21 ing to required disclosure of expenditures and contribu22 tions) is amended by redesignating paragraph (6) as para23 graph (7) and by inserting after paragraph (5) the fol24 lowing new paragraph:
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1 ‘‘(6) EXCEPTION FOR STATE AND LOCAL POLIT2 ICAL ORGANIZATIONS.—This subsection shall not

3 apply to any organization for any period—

4 ‘‘(A) such organization is organized and

5 operated exclusively for the purpose of influ6 encing or attempting to influence the selection,

7 nomination, election, or appointment of any in8 dividual to any State or local public office, and

9 ‘‘(B) such organization is required to make

10 a filing for such period, which is publicly avail11 able, with a State agency containing substan12 tially the same information as is required under

13 this subsection.’’

14 (c) EFFECTIVE DATE.—The amendments made by

15 this section shall take effect as if included in the amend16 ments made by Public Law 106–230.

17 SEC. 2. TECHNICAL CORRECTIONS TO SECTION 527 ORGA18 NIZATION DISCLOSURE PROVISIONS.

19 (a) UNSEGREGATED FUNDS NOT TO AVOID PEN20 ALTY.—Paragraph (4) of section 527(i) of the Internal

21 Revenue Code of 1986 (relating to failure to notify) is

22 amended by adding at the end the following new sentence:

23 ‘‘For purposes of the preceding sentence, the term ‘exempt

24 function income’ means any amount described in a sub-
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1 paragraph of subsection (c)(3), whether or not segregated

2 for use for an exempt function.’’

3 (b) PROCEDURES FOR ASSESSMENT AND COLLEC4 TION OF PENALTY.—Paragraph (1) of section 527(j) of

5 such Code (relating to required disclosure of expenditures

6 and contributions) is amended by adding at the end the

7 following new sentence: ‘‘For purposes of subtitle F, the

8 penalty imposed by this paragraph shall be assessed and

9 collected in the same manner as penalties imposed by sec10 tion 6652(c).’’

11 (c) APPLICATION OF FRAUD PENALTY.—Section

12 7207 of such Code (relating to fraudulent returns, state13 ments, and other documents) is amended by striking ‘‘pur14 suant to subsection (b) of section 6047 or pursuant to sub15 section (d) of section 6104’’ and inserting ‘‘pursuant to

16 section 6047(b), section 6104(d), or subsection (i) or (j)

17 of section 527’’.

18 (d) DUPLICATE ELECTRONIC AND WRITTEN FILINGS

19 NOT REQUIRED.—

20 (1) Subparagraph (A) of section 527(i)(1) of

21 such Code is amended by striking ‘‘, electronically

22 and in writing,’’.

23 (2) Subsection (i) of section 527 of such Code

24 is amended by adding at the end the following new

25 paragraph:
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1 ‘‘(8) ELECTRONIC FILING.—The Secretary shall

2 develop procedures for submission in electronic form

3 of notices required to be filed under this subsection

4 and reports required to be filed under subsection

5 (j).’’

6 (e) MODIFICATION OF GIFT TAX RULES.—Para7 graph (5) of section 2501(a) of such Code (relating to

8 transfers to political organizations) is amended by adding

9 at the end the following new sentence: ‘‘The preceding sen10 tence shall not apply in the case of any such organization

11 which is not in substantial compliance with subsections (i)

12 and (j) of section 527.’’

13 (f) EFFECTIVE DATE.—

14 (1) IN GENERAL.—Except as provided in para15 graph (2), the amendments made by this section

16 shall take effect as if included in the amendments

17 made by Public Law 106–230.

18 (2) MODIFICATION OF GIFT TAX RULES.—The

19 amendment made by subsection (e) shall apply to

20 gifts made after the date of the enactment of this

21 Act.

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