[Congressional Record (Bound Edition), Volume 160 (2014), Part 10]
[House]
[Pages 14833-14834]
[From the U.S. Government Publishing Office, www.gpo.gov]




           PROVIDING FOR A RIGHT TO AN ADMINISTRATIVE APPEAL

  Mr. BOUSTANY. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 5419) to amend the Internal Revenue Code of 1986 to provide 
for a right to an administrative appeal relating to adverse 
determinations of tax-exempt status of certain organizations.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 5419

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

     SECTION 1. ADMINISTRATIVE APPEAL RELATING TO ADVERSE 
                   DETERMINATIONS OF TAX-EXEMPT STATUS OF CERTAIN 
                   ORGANIZATIONS.

       (a) In General.--Section 7123 of the Internal Revenue Code 
     of 1986 is amended by adding at the end the following:
       ``(c) Administrative Appeal Relating to Adverse 
     Determination of Tax-Exempt Status of Certain 
     Organizations.--
       ``(1) In general.--The Secretary shall prescribe procedures 
     under which an organization described in section 501(c) may 
     request an administrative appeal (including a conference 
     relating to such appeal if requested by the organization) to 
     the Internal Revenue Service Office of Appeals of an adverse 
     determination described in paragraph (2).
       ``(2) Adverse determinations.--For purposes of paragraph 
     (1), an adverse determination is described in this paragraph 
     if such determination is adverse to an organization with 
     respect to--
       ``(A) the initial qualification or continuing qualification 
     of the organization as exempt from tax under section 501(a) 
     or as an organization described in section 170(c)(2),
       ``(B) the initial classification or continuing 
     classification of the organization as a private foundation 
     under 509(a), or
       ``(C) the initial classification or continuing 
     classification of the organization as a private operating 
     foundation under section 4942(j)(3).''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to determinations made after the date of the 
     enactment of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Louisiana (Mr. Boustany) and the gentleman from Michigan (Mr. Levin) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Louisiana.


                             General Leave

  Mr. BOUSTANY. Mr. Speaker, I ask unanimous consent that all Members 
have 5 legislative days in which to revise and extend their remarks and 
to include extraneous material on the subject of the bill under 
consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Louisiana?
  There was no objection.
  Mr. BOUSTANY. Mr. Speaker, I yield myself such time as I may consume.
  Tonight I rise in strong support of H.R. 5419. This bill which I 
introduced requires the IRS to grant the same fair and unbiased appeal 
process to groups applying for tax-exempt status as it grants to other 
taxpayers.
  During the investigation, we found that groups were being denied 
their ability to appeal denials of tax-exempt applications due to an 
unfair administrative practice at the IRS. This puts too much 
decisionmaking power in the hands of Washington bureaucrats, the same 
people we now know were depriving certain conservative groups of their 
right to operate as tax-exempt groups. This bill fixes that and 
provides equal rights to appeal for all tax-exempt applicants.
  Mr. Speaker, I urge a ``yes'' vote on this bill, and I reserve the 
balance of my time.
  Mr. LEVIN. Mr. Speaker, I yield myself such time as I may consume.
  Under current law, tax-exempt organizations are not able to request 
an administrative appeal of their initial classification of tax-exempt 
status. The bill would amend the Internal Revenue Code of 1986 to 
provide a right to an administrative appeal relating to adverse 
determinations of tax-exempt status of certain organizations.
  I might add, this would apply to all, whatever their political 
leanings, provided they meet the requirements of the statute. So this 
would apply to liberal as well as conservative organizations that were 
subject to the inappropriate standards used by the IRS.
  In 2012, the IRS received 51,748 applications for 501(c)(3) status 
and 2,774 applications for (c)(4) status.

                              {time}  2100

  In each case, less than three-tenths of 1 percent were denied. In 
2013, two-tenths of 1 percent of all 501(c)(3) applications and 
501(c)(4) applications were denied.
  I support this legislation, and urge all of my colleagues to do so.
  I yield back the balance of my time.
  Mr. BOUSTANY. Mr. Speaker, I think this is, again, commonsense 
legislation that is needed. It is a necessary reform which came out in 
the investigation that we have done so far.
  I urge its passage, and I yield back the balance of my time.

[[Page 14834]]

  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Louisiana (Mr. Boustany) that the House suspend the 
rules and pass the bill, H.R. 5419.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill was passed.
  A motion to reconsider was laid on the table.

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