I 
114TH CONGRESS 
1ST SESSION H. R. 1295 
To amend the Internal Revenue Code of 1986 to improve the process for 
making determinations with respect to whether organizations are exempt 
from taxation under section 501(c)(4) of such Code. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 4, 2015 
Mr. HOLDING (for himself and Mr. ROSKAM) 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 improve 
the process for making determinations with respect to 
whether organizations are exempt from taxation under 
section 501(c)(4) of such Code. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. ORGANIZATIONS REQUIRED TO NOTIFY SEC-
RETARY OF INTENT TO OPERATE AS 501(c)(4). 
(a) IN GENERAL.—Part I of subchapter F of chapter 
1 of the Internal Revenue Code of 1986 is amended by 
adding at the end the following new section: 
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‘‘SEC. 506. ORGANIZATIONS REQUIRED TO NOTIFY SEC-
RETARY OF INTENT TO OPERATE AS 501(c)(4). 
‘‘(a) IN GENERAL.—An organization described in 
section 501(c)(4) shall, not later than 60 days after the 
organization is established, notify the Secretary (in such 
manner as the Secretary shall by regulation prescribe) 
that it is operating as such. 
‘‘(b) CONTENTS OF NOTICE.—The notice required 
under subsection (a) shall include the following informa-
tion: 
‘‘(1) The name, address, and taxpayer identi-
fication number of the organization. 
‘‘(2) The date on which, and the State under 
the laws of which, the organization was organized. 
‘‘(3) A statement of the purpose of the organi-
zation. 
‘‘(c) ACKNOWLEDGMENT
OF RECEIPT.—Not later 
than 60 days after receipt of such a notice, the Secretary 
shall send to the organization an acknowledgment of such 
receipt. 
‘‘(d) EXTENSION
FOR REASONABLE CAUSE.—The 
Secretary may, for reasonable cause, extend the 60-day 
period described in subsection (a). 
‘‘(e) USER FEE.—The Secretary shall impose a rea-
sonable user fee for submission of the notice under sub-
section (a). 
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‘‘(f) REQUEST FOR DETERMINATION.—Upon request 
by an organization to be treated as an organization de-
scribed in section 501(c)(4), the Secretary may issue a de-
termination with respect to such treatment. Such request 
shall be treated for purposes of section 6104 as an applica-
tion for exemption from taxation under section 501(a).’’. 
(b) SUPPORTING INFORMATION WITH FIRST RE-
TURN.—Section 6033(f) of such Code is amended— 
(1) by striking the period at the end and insert-
ing ‘‘, and’’, 
(2) by striking ‘‘include on the return required 
under subsection (a) the information’’ and inserting 
the following: ‘‘include on the return required under 
subsection (a)— 
‘‘(1) the information’’, and 
(3) by adding at the end the following new 
paragraph: 
‘‘(2) in the case of the first such return filed by 
such an organization after submitting a notice to the 
Secretary under section 506(a), such information as 
the Secretary shall by regulation require in support 
of the organization’s treatment as an organization 
described in section 501(c)(4).’’. 
(c) FAILURE TO FILE INITIAL NOTIFICATION.—Sec-
tion 6652(c) of such Code is amended by redesignating 
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paragraphs (4) and (5) as paragraphs (5) and (6), respec-
tively, and by inserting after paragraph (3) the following 
new paragraph: 
‘‘(4) NOTICES UNDER SECTION 506.— 
‘‘(A) PENALTY ON ORGANIZATION.—In the 
case of a failure to submit a notice required 
under section 506(a) (relating to organizations 
required to notify Secretary of intent to operate 
as 501(c)(4)) on the date and in the manner 
prescribed therefor, there shall be paid by the 
organization failing to so submit $20 for each 
day during which such failure continues, but 
the total amount imposed under this subpara-
graph on any organization for failure to submit 
any one notice shall not exceed $5,000. 
‘‘(B) MANAGERS.—The Secretary may 
make written demand on an organization sub-
ject to penalty under subparagraph (A) speci-
fying in such demand a reasonable future date 
by which the notice shall be submitted for pur-
poses of this subparagraph. If such notice is not 
submitted on or before such date, there shall be 
paid by the person failing to so submit $20 for 
each day after the expiration of the time speci-
fied in the written demand during which such 
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failure continues, but the total amount imposed 
under this subparagraph on all persons for fail-
ure to submit any one notice shall not exceed 
$5,000.’’. 
(d) CLERICAL AMENDMENT.—The table of sections 
for part I of subchapter F of chapter 1 of such Code is 
amended by adding at the end the following new item: 
‘‘Sec. 506. Organizations required to notify Secretary of intent to operate as 
501(c)(4).’’. 
(e) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendments made by 
this section shall apply to organizations which are 
described in section 501(c)(4) of the Internal Rev-
enue Code of 1986 and organized after the date of 
the enactment of this Act. 
(2) CERTAIN
EXISTING
ORGANIZATIONS.—In 
the case of any other organization described in sec-
tion 501(c)(4) of such Code, the amendments made 
by this section shall apply to such organization only 
if, on or before the date of the enactment of this 
Act— 
(A) such organization has not applied for 
a written determination of recognition as an or-
ganization described in section 501(c)(4) of 
such Code, and 
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