To amend section 527 of the Internal Revenue Code of 1986 to eliminate notification and return requirements for State and local party committees and candidate committees and avoid duplicate reporting by certain State and local political committees of information required to be reported and made publicly available under State law, and for other purposes.
PL 107-276 (H.R.5596), enacted 11/02/2002

PUBLIC LAW 107-276—NOV. 2, 2002 
116 STAT. 1929 
Nov. 2, 2002 
Public Law 107-276 
107th Congress 
An Act 
To amend section 527 of the Internal Revenue Code of 1986 to eliminate notification 
and return requirements for State and local party committees and candidate 
committees and avoid duplicate reporting by certain State and local political 
committees of information required to be reported and made publicly available 
[H.R. 5596] 
under State law, and for other purposes. 
Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, 
SECTION 1. EXEMPTION FOR CERTAIN STATE AND LOCAL POLITICAL 
COMMITTEES FROM NOTIFICATION REQUIREMENTS. 
(a) 
EXEMPTION FROM 
NOTIFICATION REQUIREMENTS.—Para-
graph (5) of section 527(i) of the Internal Revenue Code of 1986 
26 USC 527. 
(relating to organizations must notify Secretary that they are sec-
tion 527 organizations) is amended by striking "or" at the end 
of subparagraph (A), by striking the period at the end of subpara-
graph (B) and inserting ", or", and by adding at the end the 
following: 
"(C) which is a political committee of a State or local 
candidate or which is a State or local committee of a 
political party.". 
(b) EFFECTIVE DATE.—The amendments made by subsection 
26 USC 527 note, 
(a) shall take effect as if included in the amendments made by 
PubUc Law 106-230. 
SEC. 2. EXEMPTION FOR CERTAIN STATE AND LOCAL POLITICAL 
COMMITTEES FROM REPORTING REQUIREMENTS. 
(a) IN GENERAL.—Section 527(j)(5) of the Internal Revenue 
Code of 1986 (relating to coordination with other requirements) 
is amended by redesignating subparagraphs (C), (D), and (E) as 
subparagraphs (D), (E), and (F), respectively, and by inserting after 
subparagraph (B) the following new subparagraph: 
"(C) to any organization which is a qualified State 
or local political organization,". 
(b) QUALIFIED STATE OR LOCAL POLITICAL ORGANIZATION.— 
Subsection (e) of section 527 of the Internal Revenue Code of 1986 
(relating to other definitions) is amended by adding at the end 
the following new paragraph: 
"(5) QUALIFIED STATE OR LOCAL POLITICAL ORGANIZATION.— 
"(A) IN GENERAL.—The term 'qualified State or local 
political organization' means a political organization— 
"(i) all the exempt functions of which are solely 
for the purposes of influencing or attempting to influ-
ence the selection, nomination, election, or appointment 
116 STAT. 1930 
PUBLIC LAW 107-276—NOV. 2, 2002 
of any individual to any State or local public office 
or office in a State or local political organization, 
"(ii) which is subject to State law that requires 
the organization to report (and it so reports)— 
"(I) information 
regarding 
each 
separate 
expenditure 
from 
and 
contribution 
to 
such 
organization, and 
"(II) information regarding the person who 
makes such contribution or receives such expendi-
ture, 
which would otherwise be required to be reported 
under this section, and 
"(iii) with respect to which the reports referred 
to in clause (ii) are (I) made public by the agency 
with which such reports are filed, and (II) made pub-
licly available for inspection by the organization in 
the manner described in section 6104(d). 
"(B) CERTAIN STATE LAW DIFFERENCES DISREGARDED.— 
An organization shall not be treated as failing to meet 
the requirements of subparagraph (A)(ii) solely by reason 
of 1 or more of the following: 
"(i) The minimum amount of any expenditure or 
contribution required to be reported under State law 
is not more than $300 greater than the minimum 
amount required to be reported under subsection (j). 
"(ii) The State law does not require the organiza-
tion to identify 1 or more of the following: 
"(I) The employer of any person who makes 
contributions to the organization. 
"(II) The occupation of any person who makes 
contributions to the organization. 
"(Ill) The employer of any person who receives 
expenditures from the organization. 
"(IV) The occupation of any person who 
receives expenditures from the organization. 
"(V) The purpose of any expenditure of the 
organization. 
"(VI) The date any contribution was made to 
the organization. 
"(VII) The date of any expenditure of the 
organization. 
"(C) DE MINIMIS ERRORS.—An organization shall not 
fail to be treated as a qualified State or local political 
organization solely because such organization makes de 
minimis errors in complying with the State reporting 
requirements and the public inspection 
requirements 
described in subparagraph (A) as long as the organization 
corrects such errors within a reasonable period after the 
organization becomes aware of such errors. 
"(D) PARTICIPATION OF FEDERAL CANDIDATE OR OFFICE 
HOLDER.—The term 'qualified State or local political 
organization' shall not include any organization otherwise 
described in subparagraph (A) if a candidate for nomination 
or election to Federal elective public office or an individual 
who holds such office— 
"(i) controls or materially participates in the direc-
tion of the organization. 
PUBLIC LAW 107-276—NOV. 2, 2002 
116 STAT. 1931 
"(ii) solicits contributions to the organization 
(unless the Secretary determines that such solicitations 
resulted in de minimis contributions and were made 
without the prior knowledge and consent, whether 
explicit or implicit, of the organization or its officers, 
directors, agents, or employees), or 
"(iii) directs, in whole or in part, disbursements 
by the organization.". 
(c) EFFECTIVE DATE.—The amendments made by this section 
26 use 527 note. 
shall take effect as if included in the amendments made by Public 
Law 106-230. 
SEC. 3. EXEMPTION FROM ANNUAL RETURN REQUIREMENTS. 
(a) 
INCOME TAX RETURNS REQUIRED ONLY FOR POLITICAL 
ORGANIZATION TAXABLE INCOME.—Paragraph (6) of section 6012(a) 
of the Internal Revenue Code of 1986 (relating to persons required 
26 USC 6012. 
to make returns of income) is amended by striking "or which has" 
and all that follows through "section)". 
(b) INCOME TAX RETURNS NOT SUBJECT TO DISCLOSURE.— 
(1) DISCLOSURE BY THE SECRETARY.—Subsection (b) of sec-
tion 6104 of such Code (relating to disclosure by the Secretary 
26 USC 6104. 
of annual 
information 
returns) is amended by striking 
"6012(a)(6),". 
(2) PUBLIC INSPECTION.—Subsection (d) of section 6104 of 
such Code (relating to public inspection of certain annual 
returns) is amended— 
(A) in paragraph (l)(A)(i) by striking "or section 
6012(a)(6) (relating to returns by political organizations)", 
and 
(B) in subparagraph (2) by striking "or section 
6012(a)(6)". 
(c) INFORMATION RETURNS.—Subsection (g) of section 6033 of 
such Code (relating to returns required by political organizations) 
26 USC 6033. 
is amended to read as follows: 
"(g) RETURNS REQUIRED BY POLITICAL ORGANIZATIONS.— 
"(1) IN GENERAL.—This section shall apply to a political Applicability, 
organization (as defined by section 527(e)(1)) which has gross 
receipts of $25,000 or more for the taxable year. In the case 
of a political organization which is a qualified State or local 
political organization (as defined in section 527(e)(5)), the pre-
ceding sentence shall be applied by substituting '$100,000' for 
'$25,000'. 
"(2) ANNUAL RETURNS.—Political organizations described 
in paragraph (1) shall file an annual return— 
"(A) containing the information required, and com-
plying with the other requirements, under subsection (a)(1) 
for organizations exempt from taxation under section 
501(a), with such modifications as the Secretary considers 
appropriate to require only information which is necessary 
for the purposes of carrying out section 527, and 
"(B) containing such other information as the Secretary 
deems necessary to carry out the provisions of this sub-
section. 
"(3) MANDATORY EXCEPTIONS FROM FILING.—Paragraph (2) 
shall not apply to an organization— 
"(A) which is a State or local committee of a political 
party, or political committee of a State or local candidate, 
116 STAT. 1932 
PUBLIC LAW 107-276—NOV. 2, 2002 
26 u s e 6012 
note. 
Public 
information. 
26 u s e 527 note. 
26 u s e 527. 
26 u s e 527 note. 
"(B) which is a caucus or association of State or local 
officials, 
"(C) which is an authorized committee (as defined in 
section 301(6) of the Federal Election Campaign Act of 
1971) of a candidate for Federal office, 
"(D) which is a national committee (as defined in sec-
tion 301(14) of the Federal Election Campaign Act of 1971) 
of a political party, 
"(E) which is a United States House of Representatives 
or United States Senate campaign committee of a political 
party committee, 
"(F) which is required to report under the Federal 
Election Campaign Act of 1971 as a political committee 
(as defined in section 301(4) of such Act), or 
"(G) to which section 527 applies for the taxable year 
solely by reason of subsection (f)( 1) of such section. 
"(4) DiseRETlONARY EXCEPTION.—^The Secretary may relieve 
any organization required under paragraph (2) to file an 
information return from filing such a return if the Secretary 
determines that such filing is not necessary to the efficient 
administration of the internal revenue laws.", 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall take effect as if included in the amendments made by Public 
Law 106-230. 
SEC. 4. NOTIFICATION OF INTERACTION OF REPORTING REQUIRE-
MENTS. 
(a) IN GENERAL.—The Secretary of the Treasury, in consultation 
with the Federal Election Commission, shall publicize— 
(1) the effect of the amendments made by this Act, and 
(2) the interaction of requirements to file a notification 
or report under section 527 of the Internal Revenue Code 
of 1986 and reports under the Federal Election Campaign Act 
of 1971. 
(b) INFORMATION.—Information provided under subsection (a) 
shall be included in any appropriate form, instruction, notice, or 
other guidance issued to the public by the Secretary of the Treasury 
or the Federal Election Commission regarding reporting require-
ments of political organizations (as defined in section 527 of the 
Internal Revenue Code of 1986) or reporting requirements under 
the Federal Election Campaign Act of 1971. 
SEC. 5. WAIVER OF FILING AMOUNTS. 
(a) WAIVER OF FILING AMOUNTS.—Section 527 of the Internal 
Revenue Code of 1986 is amended by adding at the end the fol-
lowing: 
"(k) AUTHORITY TO WAIVE.—The Secretary may waive all or 
any portion of the— 
"(1) tax assessed on an organization by reason of the failure 
of the organization to comply with the requirements of sub-
section (i), or 
"(2) amount imposed under subsection (j) for a failure to 
comply with the requirements thereof, 
on a showing that such failure was due to reasonable cause and 
not due to willful neglect.". 
(b) EFFECTIVE DATE.—^The amendment made by subsection (a) 
shall apply to any tax assessed or amount imposed after June 
30, 2000. 
PUBLIC LAW 107-276—NOV. 2, 2002 
116 STAT. 1933 
SEC. 6. MODIFICATIONS TO SECTION 527 ORGANIZATION DISCLOSURE 
PROVISIONS. 
(a) UNSEGREGATED FUNDS NOT T O AVOID TAX.—Paragraph (4) 
of section 527(i) of the Internal Revenue Code of 1986 (relating 26USC527. 
to failure to notify) is amended by adding at the end the following 
new sentence: "For purposes of the preceding sentence, the term 
'exempt function income' means any amount described in a subpara-
graph of subsection (c)(3), whether or not segregated for use for 
an exempt function.". 
(b) 
PROCEDURES 
FOR ASSESSMENT 
AND COLLECTION OF 
AMOUNTS.—Paragraph (1) of section 527(j) of the Internal Revenue 
Code of 1986 (relating to required disclosure of expenditures and 
contributions) is amended by adding at the end the following new 
sentence: "For purposes of subtitle F, the amount imposed by this 
paragraph shall be assessed and collected in the same manner 
as penalties imposed by section 6652(c).". 
(c) DUPLICATE WRITTEN FILINGS NOT REQUIRED.—Subpara-
graph (A) of section 527(i)(l) of the Internal Revenue Code of 
1986 is amended by striking ", electronically and in writing," and 
inserting "electronically". 
(d) APPLICATION OF FRAUD PENALTY.—Section 7207 of the 
Internal Revenue Code of 1986 (relating to fraudulent returns, 26USC7207. 
statements, and other documents) is amended by striking "pursuant 
to subsection (b) of section 6047 or pursuant to subsection (d) 
of section 6104" and inserting "pursuant to section 6047(b), section 
6104(d), or subsection (i) or (j) of section 527". 
(e) CONTENTS AND FILING OF REPORT.— 
(1) CONTENTS.—Section 527(j)(3) of the Internal Revenue 
Code of 1986 (relating to contents of report) is amended— 
(A) by inserting ", date, and purpose" after "The 
amount" in subparagraph (A), and 
(B) by inserting "and date" after "the amount" in 
subparagraph (B). 
(2) ELECTRONIC FILING.—Section 5270') of such Code is 
amended by adding at the end the following new paragraph: 
"(7) ELECTRONIC FILING.—^Any report required under para-
graph (2) with respect to any calendar year shall be filed 
in electronic form if the organization has, or has reason to 
expect to have, contributions exceeding $50,000 or expenditures 
exceeding $50,000 in such calendar year.". 
(3) ELECTRONIC FILING AND ACCESS OF REQUIRED DISCLO-
SURES.—Section 527 of such Code, as amended by section 5(a), 
is amended by redesignating subsection (k) as subsection (1) 
and by inserting after subsection (j) the following new sub-
section: 
"(k) PUBLIC AVAILABILITY OF NOTICES AND REPORTS.— 
"(1) IN GENERAL.—The Secretary shall make any notice Deadline, 
described in subsection (i)(l) or report described in subsection 
(j)(7) available for public inspection on the Internet not later 
than 48 hours after such notice or report has been filed (in 
addition to such public availability as may be made under 
section 6104(d)(7)). 
"(2) ACCESS.—The Secretary shall make the entire database 
of notices and reports which are made available to the public 
under paragraph (1) searchable by the following items (to the 
extent the items are required to be included in the notices 
and reports): 
116 STAT. 1934 
PUBLIC LAW 107-276—NOV. 2, 2002 
26 u s e 527. 
Deadline. 
Applicability. 
26 u s e 527 note. 
26 u s e 527 note. 
26 u s e 7207 
note. 
26 u s e 527 note. 
26 u s e 527 note. 
"(A) Names, States, zip codes, custodians of records, 
directors, and general purposes of the organizations. 
"(B) Entities related to the organizations. 
"(C) Contributors to the organizations. 
"(D) Employers of such contributors. 
"(E) Recipients of expenditures by the organizations. 
"(F) Ranges of contributions and expenditures. 
"(G) Time periods of the notices and reports. 
Such database shall be downloadable.". 
(f) CONTENTS OF NOTICE.—Section 527(i)(3) of the Internal Rev-
enue Code of 1986 (relating to contents of notice) is amended 
by striking "and" at the end of subparagraph (D), by redesignating 
subparagraph (E) as subparagraph (F), and by inserting after 
subparagraph (D) the following new subparagraph: 
"(E) whether the organization intends to claim an 
exemption from the requirements of subsection (j) or section 
6033, and". 
(g) TIMING OF NOTIOE IN CASE OF MATERIAL CHANGE.— 
(1) IN GENERAL.—Subparagraph (B) of section 527(i)(l) of 
the Internal Revenue Code of 1986 (relating to general notifica-
tion requirement) is amended by inserting "or, in the case 
of any material change in the information required under para-
graph (3), for the period beginning on the date on which the 
material change occurs and ending on the date on which such 
notice is given" after "given". 
(2) TIME TO GIVE NOTICE.—Section 527(i)(2) of the Internal 
Revenue Code of 1986 (relating to time to give notice) is 
amended by inserting "or, in the case of any material change 
in the information required under paragraph (3), not later 
than 30 days after such material change" after "established". 
(3) EFFECT OF FAILURE.—Paragraph (4) of section 527(i) 
of the Internal Revenue Code of 1986 (relating to effect of 
failure) is amended by inserting before the period at the end 
the following: "or, in the case of a failure relating to a material 
change, by taking into account such income and deductions 
only during the period beginning on the date on which the 
material change occurs and ending on the date on which notice 
is given under this subsection". 
(h) EFFECTIVE DATES.— 
(1) SUBSECTIONS (a) AND (b).—The amendments made by 
subsections (a) and (b) shall apply to failures occurring on 
or after the date of the enactment of this Act. 
(2) SUBSECTION (C).—The amendments made by subsection 
(c) shall take effect as if included in the amendments made 
by Public Law 106-230. 
(3) SUBSECTION (d).—The amendment made by subsection 
(d) shall apply to reports and notices required to be filed on 
or after the date of the enactment of this Act. 
(4) SUBSECTIONS (e)(i) AND (f).—The amendments made 
by subsections (e)(1) and (f) shall apply to reports and notices 
required to be filed more than 30 days after the date of the 
enactment of this Act. 
(5) SUBSECTIONS (e)(2) AND (e)(3).—The amendments made 
by subsections (e)(2) and (e)(3) shall apply to reports required 
to be filed on or after June 30, 2003. 
(6) SUBSECTION (g).— 
PUBLIC LAW 107-276—NOV. 2, 2002 
116 STAT. 1935 
(A) IN GENERAL.—The amendments made by subsection 
(g) shall apply to material changes on or after the date 
of the enactment of this Act. 
(B) TRANSITION RULE.—In the case of a material change 
occurring during the 30-day period beginning on the date 
of the enactment of this Act, a notice under section 527(i) 
of the Internal Revenue Code of 1986 (as amended by 
this Act) shall not be required to be filed under such 
section before the later o
f
— 
(i) 30 days after the date of such material change, 
or 
(ii) 45 days after the date of the enactment of 
this Act. 
SEC. 7. EFFECT OF AMENDMENTS ON EXISTING DISCLOSURES. 
26 USC 6104 
Notices, reports, or returns that were required to be filed with 
the Secretary of the Treasury before the date of the enactment 
of the amendments made by this Act and that were disclosed 
by the Secretary of the Treasury consistent with the law in effect 
at the time of disclosure shall remain subject on and after such 
date to the disclosure provisions of section 6104 of the Internal 
Revenue Code of 1986. 
Approved November 2, 2002. 
LEGISLATIVE HISTORY—H.R. 5596: 
CONGRESSIONAL RECORD, Vol. 148 (2002): 
Oct. 16, considered and passed House. 
Oct. 17, considered and passed Senate.