II 

113TH CONGRESS 

2D SESSION S. 2072 

To prohibit the Department of the Treasury from assigning tax statuses 

to organizations based on their political beliefs and activities. 

IN THE SENATE OF THE UNITED STATES 

FEBRUARY 27, 2014 

Mr. CRUZ introduced the following bill; which was read twice and referred to 

the Committee on Finance 

A BILL 

To prohibit the Department of the Treasury from assigning 

tax statuses to organizations based on their political beliefs and activities. 

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

3 SECTION 1. PROHIBITING TAX STATUS FROM BEING AS4 SIGNED BASED ON POLITICAL BELIEFS AND 

5 ACTIVITIES. 

6 (a) FINDINGS.—Congress finds the following: 

7 (1) The income tax system of the United States 

8 relies on voluntary compliance by taxpayers. 

9 (2) The filing of tax returns and other tax-re10 lated documents with the Internal Revenue Service 


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1 often requires the submission of information to the 

2 Federal Government that taxpayers would otherwise 

3 consider private. 

4 (3) To ensure widespread voluntary compliance 

5 by taxpayers, the American public must have abso6 lute trust that the Internal Revenue Service is acting 

7 in a non-partisan manner. 

8 (4) Taxpayers must be ensured that their treat9 ment by the Internal Revenue Service will not be 

10 based on race, national origin, gender, sexual ori11 entation, religious beliefs, or political creed, includ12 ing their support for or opposition to any govern13 ment policies. 

14 (5) The confidence of taxpayers in the system 

15 of taxation in the United States is compromised 

16 when the Internal Revenue Service is required to as17 sign tax treatment based on political beliefs or ac18 tivities. 

19 (6) The targeting of certain individuals and 

20 groups by the Internal Revenue Service based on 

21 their political beliefs and activities must be stopped, 

22 and to ensure the integrity of the income tax system 

23 of the United States, the Internal Revenue Service 

24 should be removed from evaluating the political ac25 tivities of any individuals or organizations. 


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1 (b) POLITICAL ORGANIZATIONS.—Paragraph (1) of 

2 section 527(e) of the Internal Revenue Code of 1986 is 

3 amended to read as follows: 

4 ‘‘(1) POLITICAL ORGANIZATION.—The term ‘po5 litical organization’ means a party, committee, asso6 ciation, fund, or other organization (whether or not 

7 incorporated)— 

8 ‘‘(A) which is registered as a political com9 mittee with the Federal Election Commission, 

10 ‘‘(B) has been determined, pursuant to 

11 proceedings under section 309 of the Federal 

12 Election Campaign Act of 1971 (2 U.S.C. 

13 437g) or by a court of law, to be a political 

14 committee, as defined under section 301(4) of 

15 such Act (2 U.S.C. 431(4)), or 

16 ‘‘(C) which is organized and operated pri17 marily for the purposes of directly or indirectly 

18 accepting contributions or making expenditures, 

19 or both, for influencing or attempting to influ20 ence the selection, nomination, election, or ap21 pointment of any individual to any State or 

22 local public office and— 

23 ‘‘(i) is not required to register with 

24 the Federal Election Commission, and 


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1 ‘‘(ii) is required to register with the 

2 appropriate State agency as a political 

3 committee.’’. 

4 (c) TAX-EXEMPT ORGANIZATIONS.—Section 501 of 

5 such Code is amended— 

6 (1) by redesignating subsection (s) as sub7 section (t), and 

8 (2) by inserting after subsection (r) the fol9 lowing new subsection: 

10 ‘‘(s) PROMOTION OF SOCIAL WELFARE.— 

11 ‘‘(1) IN GENERAL.—For purposes of paragraph 

12 (4)(A) of subsection (c), the term ‘promotion of so13 cial welfare’ shall include— 

14 ‘‘(A) any political activity in furtherance of 

15 American democracy, provided that such activi16 ties do not exceed 50 percent of the organiza17 tion’s total activities (not including activities 

18 performed on a volunteer basis), 

19 ‘‘(B) any activities for the purpose of edu20 cating individuals on issues of public impor21 tance and on the behavior of public officials, in22 cluding participation in ballot initiatives and 

23 referenda, and 

24 ‘‘(C) any activity described in clauses (i), 

25 (ii), (iii), and (v) of section 301(9)(B) of the 


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1 Federal Election Campaign Act of 1971 (2 

2 U.S.C. 431(9)(B)). 

3 ‘‘(2) POLITICAL ACTIVITY IN FURTHERANCE OF

4 AMERICAN DEMOCRACY.—For purposes of this sub5 section, the term ‘political activity in furtherance of 

6 American democracy’ shall include any activity de7 scribed in subparagraph (A) of section 301(9) of the 

8 Federal Election Campaign Act of 1971 (2 U.S.C. 

9 431(9)). 

10 ‘‘(3) RULE OF CONSTRUCTION.—Nothing in 

11 this subsection shall be construed to exempt an or12 ganization from satisfying any applicable require13 ments for filing as a political committee pursuant to 

14 the Federal Election Campaign Act of 1971 (2 

15 U.S.C. 431 et seq.).’’. 

Æ 


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