[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 274 Introduced in Senate (IS)]

114th CONGRESS
  1st Session
                                 S. 274

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

                            January 28, 2015

   Mr. Cruz (for himself, Mr. Grassley, Mr. Inhofe, and Mr. Vitter) 
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.

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

SECTION 1. PROHIBITING TAX STATUS FROM BEING ASSIGNED BASED ON 
              POLITICAL BELIEFS AND ACTIVITIES.

    (a) Findings.--Congress finds the following:
            (1) The income tax system of the United States relies on 
        voluntary compliance by taxpayers.
            (2) The filing of tax returns and other tax-related 
        documents with the Internal Revenue Service often requires the 
        submission of information to the Federal government that 
        taxpayers would otherwise consider private.
            (3) To ensure widespread voluntary compliance by taxpayers, 
        the American public must have absolute trust that the Internal 
        Revenue Service is acting in a non-partisan manner.
            (4) Taxpayers must be ensured that their treatment by the 
        Internal Revenue Service will not be based on race, national 
        origin, gender, sexual orientation, religious beliefs, or 
        political creed, including their support for or opposition to 
        any government policies.
            (5) The confidence of taxpayers in the system of taxation 
        in the United States is compromised when the Internal Revenue 
        Service is required to assign tax treatment based on political 
        beliefs or activities.
            (6) The targeting of certain individuals and groups by the 
        Internal Revenue Services based on their political beliefs and 
        activities must be stopped, and to ensure the integrity of the 
        income tax system of the United States, the Internal Revenue 
        Service should be removed from evaluating the political 
        activities of any individuals or organizations.
    (b) Political Organizations.--Paragraph (1) of section 527(e) of 
the Internal Revenue Code of 1986 is amended to read as follows:
            ``(1) Political organization.--The term `political 
        organization' means a party, committee, association, fund, or 
        other organization (whether or not incorporated)--
                    ``(A) which is registered as a political committee 
                with the Federal Election Commission,
                    ``(B) has been determined, pursuant to proceedings 
                under section 309 of the Federal Election Campaign Act 
                of 1971 (52 U.S.C. 30109) or by a court of law, to be a 
                political committee, as defined under section 301(4) of 
                such Act (52 U.S.C. 30101(4)), or
                    ``(C) which is organized and operated primarily for 
                the purposes of directly or indirectly accepting 
                contributions or making expenditures, or both, for 
                influencing or attempting to influence the selection, 
                nomination, election, or appointment of any individual 
                to any State or local public office and--
                            ``(i) is not required to register with the 
                        Federal Election Commission, and
                            ``(ii) is required to register with the 
                        appropriate State agency as a political 
                        committee.''.
    (c) Tax-Exempt Organizations.--Section 501 of such Code is amended 
by inserting after subsection (r) the following new subsection:
    ``(s) Promotion of Social Welfare.--
            ``(1) In general.--For purposes of paragraph (4)(A) of 
        subsection (c), the term `promotion of social welfare' shall 
        include--
                    ``(A) any political activity in furtherance of 
                American democracy, provided that such activities do 
                not exceed 50 percent of the organization's total 
                activities (not including activities performed on a 
                volunteer basis),
                    ``(B) any activities for the purpose of educating 
                individuals on issues of public importance and on the 
                behavior of public officials, including participation 
                in ballot initiatives and referenda, and
                    ``(C) any activity described in clauses (i), (ii), 
                (iii), and (v) of section 301(9)(B) of the Federal 
                Election Campaign Act of 1971 (52 U.S.C. 30101(9)(B)).
            ``(2) Political activity in furtherance of american 
        democracy.--For purposes of this subsection, the term 
        `political activity in furtherance of American democracy' shall 
        include any activity described in subparagraph (A) of section 
        301(9) of the Federal Election Campaign Act of 1971 (52 U.S.C. 
        30101(9)).
            ``(3) Rule of construction.--Nothing in this subsection 
        shall be construed to exempt an organization from satisfying 
        any applicable requirements for filing as a political committee 
        pursuant to the Federal Election Campaign Act of 1971 (52 
        U.S.C. 30101 et seq.).''.
                                 <all>