[House Report 118-569]
[From the U.S. Government Publishing Office]


118th Congress }                                          { Report 
                        HOUSE OF REPRESENTATIVES
  2d Session   }                                          { 118-569

======================================================================
 
                      FOREIGN GRANT REPORTING ACT

                                _______
                                

 June 28, 2024.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

Mr. Smith of Missouri, from the Committee on Ways and Means, submitted 
                             the following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 8290]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 8290) to amend the Internal Revenue Code of 1986 to 
require the public disclosure of grants made by certain tax-
exempt organizations to foreign entities, having considered the 
same, reports favorably thereon with an amendment and 
recommends that the bill as amended do pass.

                                CONTENTS

                                                                   Page
  I. SUMMARY AND BACKGROUND...........................................2
          A. Purpose and Summary.................................     2
          B. Background and Need for Legislation.................     3
          C. Legislative History.................................     4
                Background.......................................     4
                Committee Hearings...............................     4
                Committee Action.................................     4
          D. Designated Hearing..................................     4
 II. EXPLANATION OF THE BILL..........................................4
          A. Disclosure of Grants Made by Certain Tax-Exempt 
              Organizations to Foreign Entities (sec. 2 of the 
              bill and sec. 6033 of the Code)....................     4
          B. Reasons for Change..................................     8
          C. Explanation of Provisions...........................     8
          D. Effective Date......................................     8
III. VOTES OF THE COMMITTEE...........................................9
 IV. BUDGET EFFECTS OF THE BILL......................................10
          A. Committee Estimate of Budgetary Effects.............    10
          B. Statement Regarding New Budget Authority and Tax 
              Expenditures Budget Authority......................    10
  V. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE.......10
 VI. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE......11
          A. Committee Oversight Findings and Recommendations....    11
          B. Statement of General Performance Goals and 
              Objectives.........................................    11
          C. Information Relating to Unfunded Mandates...........    11
          D. Applicability of House Rule XXI, Clause 5(b)........    12
          E. Tax Complexity Analysis.............................    12
          F. Congressional Earmarks, Limited Tax Benefits, and 
              Limited Tariff Benefits............................    12
          G. Duplication of Federal Programs.....................    12
VII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED...........12
VIII.ADDITIONAL VIEWS................................................23


    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Foreign Grant Reporting Act''.

SEC. 2. DISCLOSURE OF GRANTS MADE BY CERTAIN TAX-EXEMPT ORGANIZATIONS 
                    TO FOREIGN ENTITIES.

  (a) In General.--Section 6033 of the Internal Revenue Code of 1986 is 
amended by redesignating subsection (o) as subsection (p) and by 
inserting after subsection (n) the following new subsection:
  ``(o) Requirement To Report Certain Information With Respect to 
Grants to Foreign Entities.--
          ``(1) In general.--If an organization described in section 
        501(c) which files an annual return under subsection (a) is 
        required to include in such return information regarding any 
        grant or other assistance provided by such organization to any 
        foreign entity, such organization shall include in such return 
        (in addition to the information so required to be included) the 
        following information:
                  ``(A) The name and address of such foreign entity.
                  ``(B) The aggregate amount of such grants or other 
                assistance provided to such foreign entity during the 
                year.
                  ``(C) Whether such foreign entity is described in 
                each of the following clauses:
                          ``(i) An entity recognized as a charity by 
                        the foreign country in which such entity is 
                        organized.
                          ``(ii) An organization described in section 
                        501(c)(3) and exempt from tax under section 
                        501(a).
                          ``(iii) An organization with respect to which 
                        the organization making the return under 
                        subsection (a) has made a good faith 
                        determination that the foreign entity is an 
                        organization described in section 
                        4945(d)(4)(A).
                          ``(iv) An organization which is not described 
                        in clause (i), (ii), or (iii).
          ``(2) Foreign entity.--For purposes of this subsection, the 
        term `foreign entity' means any organization or entity created 
        or organized outside the United States. For purposes of the 
        preceding sentence, the term `United States' includes the 
        possessions of the United States.
          ``(3) Indirect contributions.--In the case of any grant or 
        other contribution made indirectly to any foreign entity, the 
        information required to be reported under paragraph (1) shall 
        be reported with respect to each person to which such grant or 
        other contribution is made directly or indirectly.''.
  (b) Effective Date.--The amendments made by this section shall apply 
to returns filed for taxable years beginning after the date of the 
enactment of this Act.

                       I. SUMMARY AND BACKGROUND


                         A. Purpose and Summary

    The bill, H.R. 8290, the ``Foreign Grant Reporting Act,'' 
as ordered reported by the Committee on Ways and Means on May 
15, 2024.
    Section 2 of the bill requires that a tax-exempt 
organization described in section 501(c) of the Internal 
Revenue Code report on its annual information return filed with 
the Internal Revenue Service (generally, its IRS Form 990) 
certain information relating to grants made to foreign 
entities. In general, where the organization is required to 
provide information relating to grants to a foreign entity, it 
must provide, in addition to such information, the name and 
address of the recipient entity, the aggregate amount of grants 
or other assistance provided to the recipient entity, and 
certain information relating to the charitable status of the 
recipient entity.

                 B. Background and Need for Legislation

    The Committee on Ways and Means has conducted oversight of 
the tax-exempt sector established under Section 501(c) of the 
Internal Revenue Code throughout the 118th Congress. In August 
2023, the Committee published an open letter requesting 
information on tax-exempt organizations focused on potential 
violations of rules regarding political activities, 
inappropriate use of charitable funds, and concerns about 
foreign sources of funding.\1\ In November 2023, the Committee 
held a hearing which examined the history of U.S. tax-exempt 
groups financing terror abroad.\2\ In December 2023, the 
Committee's Oversight Subcommittee held a hearing on the growth 
of the tax-exempt sector and its impact on the American 
political system.\3\
---------------------------------------------------------------------------
    \1\H. Comm. on Ways and Means, Request for Information: 
Understanding and Examining the Political Activities of Tax-Exempt 
Organizations under Section 501 of the Internal Revenue Code (Aug. 14, 
2023), https://gop-waysandmeans.house.gov/wp-content/uploads/2023/09/
UPDATED-RFI-on-501c3-and-c4-Activities-FINAL.docx87.pdf.
    \2\H. Comm. On Ways and Means, Hearing: From Ivory Towers to Dark 
Corners: Investigating the Nexus Between Antisemitism, Tax-Exempt 
Universities, and Terror Financing (Nov. 15, 2023), https://
waysandmeans.house.gov/event/hearing-from-ivory-towers-to-dark-corners-
investigating-the-nexus-between-antisemitism-tax-exempt-universities-
and-terror-financing/.
    \3\H. Comm. On Ways and Means, Oversight Subcommittee Hearing: The 
Growth of the Tax-Exempt Sector and the Impact on the American 
Political Landscape (Dec. 13, 2023), https://waysandmeans.house.gov/
event/oversight-subcommittee-hearing-on-growth-of-the-tax-exempt-
sector-and-the-impact-on-the-american-political-landscape/.
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    During the course of that oversight, the Committee 
recognized that while most tax- exempt organizations report 
detailed information about the grants they issue to U.S.-based 
organizations, the information they must disclose about foreign 
grant recipients is far less detailed.\4\ The Committee is 
concerned that Americans may be unknowingly making donations to 
tax-exempt organizations that are conducting illicit activities 
abroad, such as the financing of terrorism as discussed during 
the Committee's November 2023 hearing.
---------------------------------------------------------------------------
    \4\Internal Revenue Service, 2023 Instructions for Form 990 Return 
of Organization Exempt From Income Tax (Dec. 14, 2023), https://
www.irs.gov/pub/irs-pdf/i990.pdf.
---------------------------------------------------------------------------
    Given the disparity in the reporting requirements for 
grants from tax-exempt organizations to domestic and foreign 
organizations and the testimony the Committee heard in November 
2023 regarding the activities of some tax-exempt organizations, 
the goal of the legislation is to bring parity between tax-
exempt organizations' domestic grant reporting requirements and 
foreign grant reporting requirements to provide transparency 
that will aid Congress's oversight efforts.

                         C. Legislative History


Background

    H.R. 8290 was introduced on May 8, 2024, and was referred 
to the Committee on Ways and Means.

Committee Hearings

    The Committee on Ways and Means held the following 
hearing(s) concerning the policy in H.R. 8290:
    On November 15, 2023, the Committee on Ways and Means held 
a hearing titled, ``From Ivory Towers to Dark Corners: 
Investigating the Nexus Between Antisemitism, Tax-Exempt 
Universities, and Terror Financing'' to examine the role of 
tax-exempt organizations in fueling antisemitic activities and 
funding terrorism.\5\
---------------------------------------------------------------------------
    \5\H. Comm. On Ways and Means, Hearing: From Ivory Towers to Dark 
Corners: Investigating the Nexus Between Antisemitism, Tax-Exempt 
Universities, and Terror Financing (Nov. 15, 2023), https://
waysandmeans.house.gov/event/hearing-from-ivory-towers-to-dark-corners-
investigating-the-nexus-between-antisemitism-tax-exempt-universities-
and-terror-financing/.
---------------------------------------------------------------------------
    On December 13, 2023, the Committee on Ways and Means held 
a hearing titled, ``Growth of the Tax-Exempt Sector and the 
Impact on the American Political Landscape'' on the growth of 
the tax-exempt sector and its impact on American elections.\6\
---------------------------------------------------------------------------
    \6\H. Comm. On Ways and Means, Oversight Subcommittee Hearing: The 
Growth of the Tax-Exempt Sector and the Impact on the American 
Political Landscape (Dec. 13, 2023), https://waysandmeans.house.gov/
event/oversight-subcommittee-hearing-on-growth-of-the-tax-exempt-
sector-and-the-impact-on-the-american-political-landscape/.
---------------------------------------------------------------------------

Committee Action

    The Committee on Ways and Means marked up H.R. 8920, the 
Foreign Grant Reporting Act, on May 15, 2024, and favorably 
reported the bill, as amended, to the House of Representatives 
(with quorum being present).

                         D. Designated Hearing

    Pursuant to clause 3(c)(6) of rule XIII, the following 
hearing was used to develop and consider H.R. 8290:
    ``From Ivory Towers to Dark Corners: Investigating the 
Nexus Between Antisemitism, Tax-Exempt Universities, and Terror 
Financing'' on November 15, 2023.\7\
---------------------------------------------------------------------------
    \7\H. Comm. On Ways and Means, Hearing: From Ivory Towers to Dark 
Corners: Investigating the Nexus Between Antisemitism, Tax-Exempt 
Universities, and Terror Financing (Nov. 15, 2023), https://
waysandmeans.house.gov/event/hearing-from-ivory-towers-to-dark-corners-
investigating-the-nexus-between-antisemitism-tax-exempt-universities-
and-terror-financing/.
---------------------------------------------------------------------------

                      II. EXPLANATION OF THE BILL


  A. Disclosure of Grants Made by Certain Tax-Exempt Organizations to 
    Foreign Entities (Sec. 2 of the Bill and Sec. 6033 of the Code)


                              PRESENT LAW

Form 990 reporting by tax-exempt organizations, in general

    A tax-exempt organization generally is required to file an 
annual information return with the IRS. An organization that 
has not received a determination of its tax-exempt status, but 
that claims tax-exempt status under section 501(a), is subject 
to the same annual reporting requirements and exceptions as 
organizations that have received a formal determination.
    In general, organizations described in section 501(c) and 
exempt from taxation under section 501(a) are required to file 
an annual return (Form 990 series), stating specifically the 
items of gross income, receipts, disbursements, and such other 
information as the Secretary may prescribe.\8\ An organization 
that is required to file an information return, but that has 
gross receipts of less than $200,000 during its taxable year, 
and total assets of less than $500,000 at the end of its 
taxable year, may file Form 990-EZ. Section 501(c)(3) private 
foundations are required to file Form 990-PF rather than Form 
990. Any organization that is subject to UBIT and that has 
$1,000 or more of gross unrelated business taxable income must 
also file Form 990-T (Exempt Organization Business Income Tax 
Return).\9\
---------------------------------------------------------------------------
    \8\Sec. 6033(a).
    \9\Tax-exempt organizations also generally must file reports and 
returns applicable to taxable entities with respect to Social Security 
taxes and, in certain instances, Federal unemployment taxes.
---------------------------------------------------------------------------
    On the applicable annual information return, organizations 
are required to report their gross income, information on their 
finances, functional expenses, compensation, activities, and 
other information required by the IRS to permit a review of the 
organization's activities and operations during the previous 
taxable year and to allow for review of whether the 
organization continues to meet the statutory requirements for 
exemption.
    The requirement that an exempt organization file an annual 
information return (Form 990 or Form 990-EZ) does not apply to 
certain tax-exempt organizations, including organizations 
(other than private foundations) the gross receipts of which in 
each taxable year normally are not more than $50,000. 
Organizations that are excused from filing an information 
return by reason of normally having gross receipts below such 
amount must furnish to the Secretary an annual notice (Form 
990-N), in electronic form, containing certain basic 
information about the organization.\10\
---------------------------------------------------------------------------
    \10\Sec. 6033(i).
---------------------------------------------------------------------------
    Other organizations exempt from the annual information 
return requirement include: churches, their integrated 
auxiliaries, and conventions or associations of churches; the 
exclusively religious activities of any religious order; 
certain State institutions whose income is excluded from gross 
income under section 115; an interchurch organization of local 
units of a church; certain mission societies; certain church-
affiliated elementary and high schools; and certain other 
organizations, including some that the IRS has relieved from 
the filing requirement pursuant to its statutory discretionary 
authority.\11\
---------------------------------------------------------------------------
    \11\Sec. 6033(a)(2)(A); Treas. Reg. secs. 1.6033-2(a)(2)(i) and 
(g)(1).
---------------------------------------------------------------------------

Reporting relating to grants made by an organization

            Section 501(c)(3) private foundations (Form 990-PF)
    A section 501(c)(3) private foundation that had $5,000 or 
more in assets at any time during the year must complete Part 
XIV of Form 990-PF for the year. Line 3 of Part XIV (for 2023) 
requires the following information relating to grants or 
contributions paid by the organization during the year or 
approved for future payment: (1) the recipient's name and 
address (home or business); (2) if the recipient is an 
individual, the relationship to any foundation manager or 
substantial contributor; (3) the foundation status of the 
recipient;\12\ (4) the purpose of the grant or contribution; 
and (5) the amount.
---------------------------------------------------------------------------
    \12\The instructions to Form 990-PF for 2023 (p. 36), list several 
codes that are to be used for describing a recipient organization's 
foundation status. The codes correspond to statuses such as private 
operating foundation, private non-operating foundation, public charity, 
supporting organization (various types), and individual.
---------------------------------------------------------------------------
    Line 3 does not distinguish between grants or contributions 
paid to grantees located in the United States and grants or 
contributions paid to grantees located outside of the United 
States; thus, the above information must be provided for all 
grants or contributions paid or approved for payment, 
regardless of the location of the grantee or the country of 
organization.
            Other section 501(c) organizations (Form 990)
    Most other section 501(c)(3) organizations that are 
required to file an annual information return, including 
section 501(c)(3) public charities, file Form 990 or Form 990-
EZ.
    Form 990-EZ filers.--An organization that files Form 990-EZ 
(generally, an organization with gross receipts of less than 
$200,000 and total assets of less than $500,000), reports the 
total amount of ``grants and similar amounts paid'' on line 10 
of Part I of the form and then is required to provide 
additional information on Schedule O. The instructions to Form 
990-EZ for 2023 (p. 15) states that the organization must list 
in Schedule O each grantee organization or individual to whom 
the organization made grants or paid similar amounts in excess 
of $5,000 during the organization's tax year.
    The instructions require the name and address for grantee 
organizations, but not for grantee individuals. The 
instructions also require, for each such payee: (1) the class 
of activity; (2) the aggregate amount given; and (3) if an 
individual, the relationship of the individual to any person or 
corporation with an interest in the organization. Colleges, 
universities, and other schools that provide scholarships or 
other financial assistance are permitted to provide aggregate 
information concerning the payments. If an organization gave 
property other than cash, additional descriptive information 
relating to the property is required.
    Form 990 filers.--An organization that files Form 990 must 
complete Schedule I for certain grants to or for domestic 
organizations and individuals\13\ and Schedule F for certain 
grants to or for foreign organizations and individuals.\14\
---------------------------------------------------------------------------
    \13\See Form 990 for 2023, Part IV, lines 21 and 22.
    \14\See Form 990 for 2023, Part IV, lines 15 and 16.
---------------------------------------------------------------------------
    Grants to domestic organizations or governments. In 
Schedule I, Part II, the filing organization must provide 
information relating to grants or other assistance provided to 
or for domestic organizations or governments for any recipient 
that received more than $5,000. For each such recipient, the 
filing organization must provide: (1) the name and address of 
the recipient; (2) the recipient's EIN; (3) the Code section 
under which the recipient organization is tax-exempt, if 
applicable; (4) the dollar amount of cash grants; (5) the value 
of non-cash property, together with the method of valuation and 
a description of the property; and (6) the purpose or use of 
the grant funds or other assistance.
    In lines 2 and 3 of Part II, the filing organization must 
provide the total number of grant recipients that are either 
section 501(c)(3) organizations or government organizations and 
the number of grant recipients that are other types of 
organizations. This information need not be provided on a 
recipient-by-recipient basis.
    Grants to domestic individuals. In Schedule I, Part III, 
the filing organization must provide information relating to 
grants or other assistance to or for domestic individuals if 
the total amount of such grants and assistance is more than 
$5,000, determined in the aggregate, not on a per-recipient 
basis. The information provided in Part III is aggregated by 
type of grant or assistance provided; individual recipients are 
not listed. For each category, the organization must provide: 
(1) the type of grant or assistance; (2) the number of 
recipients; (3) the aggregate dollar amount of cash grants; and 
(4) the value of non-cash property, together with the method of 
valuation and a description of the property.
    Grants to foreign organizations or entities. In Schedule F, 
Part II, the filing organization must provide information 
relating to grants or other assistance provided to or for 
organizations or other entities outside the United States for 
any recipient that received more than $5,000. For each such 
recipient, the filing organization must provide: (1) the region 
where the principal foreign office of the recipient 
organization or entity is located (or if there is no such 
principal office, the region where the grant funds were or will 
be used); (2) the purpose or ultimate use of the grant funds; 
(3) the dollar amount of cash grants and the manner of cash 
disbursement; and (4) the value of non-cash property, together 
with the method of valuation and a description of the property.
    Although the columns (a) and (b) of Part II are designated 
``Name of Organization'' and ``IRS code section and EIN (if 
applicable),'' the columns are shaded grey, and the 
instructions to Schedule F (p. 3) state: ``Don't complete Part 
II, line 1, column (a) or (b). However, complete columns (c) 
through (i) as if columns (a) and (b) were completed.''\15\ As 
such, the filing organization need not provide the name, EIN, 
or other identifying information relating to the specific 
foreign organizations or entities to which a grant or other 
assistance was provided.
---------------------------------------------------------------------------
    \15\Italics in original.
---------------------------------------------------------------------------
    In lines 2 and 3 of Part II, the filing organization must 
provide aggregate information about the tax status of the 
recipient organizations, specifically, the number of recipient 
organizations recognized as a charity by the foreign country, 
the number recognized as tax-exempt under section 501(c)(3) by 
the IRS, and number of organizations not falling into one of 
the other categories. This information need not be provided on 
a recipient-by-recipient basis.
    Grants to foreign individuals. In Schedule F, Part III, the 
filing organization must provide information relating to grants 
or other assistance to or for individuals outside the United 
States if the total amount of such grants and assistance is 
more than $5,000, determined in the aggregate, not on a per-
recipient basis. The information provided in Part III is 
aggregated by type of grant or assistance provided; individual 
recipients are not listed. For each category, the organization 
must provide: (1) the type of grant or assistance; (2) each 
region in which grants or other assistance were provided to or 
for foreign individuals; (3) the number of recipients; (4) the 
aggregate dollar amount of cash grants and the manner of 
disbursement; and (5) the value of non-cash property, together 
with the method of valuation and a description of the property.

                         B. Reasons for Change

    Under current rules, section 501(c) organizations are 
generally required to report less information about grants made 
to foreign recipients than grants made to domestic recipients, 
and the Committee believes that the reporting rules should be 
brought into parity. Therefore, the Committee believes it is 
important to require section 501(c) organizations to report 
additional information about grants made to foreign recipients.

                      C. Explanation of Provisions

    The provision provides that an organization described in 
section 501(c) which files an annual information return to the 
IRS, and is required to provide information relating to grants 
or other assistance provided by the organization to any foreign 
entity, must include in the return, in addition to the 
information on foreign grants otherwise required, the following 
information: (1) the name and address of the foreign entity, 
(2) the aggregate amount of grants or other assistance provided 
to the foreign entity during the year, (3) whether the foreign 
entity is one of the following: (i) an entity recognized as a 
charity by the foreign country in which the entity is 
organized, (ii) an organization described in section 501(c)(3) 
and exempt from Federal income tax under section 501(a), (iii) 
an organization with respect to which the filing organization 
has made a good faith determination that the foreign entity is 
an organization described in section 4945(d)(4)(A),\16\ or (iv) 
an organization which is not described in (i), (ii), or (iii).
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    \16\The following organizations are described in section 
4945(d)(4)(A): (1) a publicly or broadly supported organization 
described in section 509(a)(1) or (2); (2) a supporting organization 
described in section 509(a)(3) (other than an organization described in 
section 4942(g)(4)(A)(i) (i.e., Type III supporting organization that 
is not functionally integrated) or section 4942(g)(4)(A)(ii) (i.e., a 
Type I, Type II, or functionally integrated Type III supporting 
organization if one or more disqualified persons of the private 
foundation directly or indirectly controls the supporting organization 
or one of its supported organizations); and (3) an exempt operating 
foundation.
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    For this purpose, the term ``foreign entity'' means any 
organization or entity created or organized outside the United 
States (including possessions of the United States).
    In the case of any grant or other contribution made 
indirectly to a foreign entity, information must be reported on 
the annual information return with respect to each person to 
which the grant or other contribution is made directly or 
indirectly.

                           D. Effective Date

    The provision is effective for returns filed for taxable 
years beginning after the date of enactment.

                      III. VOTES OF THE COMMITTEE

    In compliance with the Rules of the House of 
Representatives, the following statement is made concerning the 
vote of the Committee on Ways and Means during the markup 
consideration of H.R. 8290, the ``Foreign Grant Reporting 
Act,'' on May 15, 2024.
    The vote on the amendment offered by Mr. Schneider to the 
amendment in the nature of a substitute to H.R. 8290, which 
would provide a definition for indirect grants for the purposes 
of this bill was not agreed to by a roll call vote of 15 yeas 
to 22 nays (with a quorum being present). The vote was as 
follows:

----------------------------------------------------------------------------------------------------------------
           Representative              Yea     Nay    Present       Representative       Yea     Nay    Present
----------------------------------------------------------------------------------------------------------------
Mr. Smith (MO).....................  ......      X   .........  Mr. Neal.............      X   ......  .........
Mr. Buchanan.......................  ......      X   .........  Mr. Doggett..........      X   ......  .........
Mr. Smith (NE).....................  ......      X   .........  Mr. Thompson.........      X   ......  .........
Mr. Kelly..........................  ......      X   .........  Mr. Larson...........      X   ......  .........
Mr. Schweikert.....................  ......      X   .........  Mr. Blumenauer.......      X   ......  .........
Mr. LaHood.........................  ......  ......  .........  Mr. Pascrell.........      X   ......  .........
Dr. Wenstrup.......................  ......      X   .........  Mr. Davis............  ......  ......  .........
Mr. Arringson......................  ......  ......  .........  Ms. Sanchez..........  ......  ......  .........
Dr. Ferguson.......................  ......      X   .........  Ms. Sewell...........      X   ......  .........
Mr. Estes..........................  ......      X   .........  Ms. DelBene..........      X   ......  .........
Mr. Smucker........................  ......      X   .........  Ms. Chu..............      X   ......  .........
Mr. Hern...........................  ......      X   .........  Ms. Moore............      X   ......  .........
Ms. Miller.........................  ......  ......  .........  Mr. Kildee...........      X   ......  .........
Dr. Murphy.........................  ......      X   .........  Mr. Beyer............      X   ......  .........
Mr. Kustoff........................  ......      X   .........  Mr. Evans............  ......  ......  .........
Mr. Fitzpatrick....................  ......      X   .........  Mr. Schneider........      X   ......  .........
Mr. Steube.........................  ......      X   .........  Mr. Panetta..........      X   ......  .........
Ms. Tenney.........................  ......      X   .........  Mr. Gomez............      X   ......  .........
Mrs. Fischbach.....................  ......      X   .........
Mr. Moore..........................  ......      X   .........
Mrs. Steel.........................  ......      X   .........
Ms. Van Duyne......................  ......      X   .........
Mr. Feenstra.......................  ......      X   .........
Ms. Malliotakis....................  ......      X   .........
Mr. Carey..........................  ......      X   .........
----------------------------------------------------------------------------------------------------------------

    In compliance with the Rules of the House of 
Representatives, the following statement is made concerning the 
vote of the Committee on Ways and Means during the markup 
consideration of H.R. 8290, the ``Foreign Grant Reporting 
Act,'' on May 15, 2024.
    H.R. 8290 was ordered favorably reported to the House of 
Representatives as amended by a roll call vote of 38 yeas to 0 
nays (with a quorum being present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
           Representative              Yea     Nay    Present       Representative       Yea     Nay    Present
----------------------------------------------------------------------------------------------------------------
Mr. Smith (MO).....................      X   ......  .........  Mr. Neal.............      X   ......  .........
Mr. Buchanan.......................      X   ......  .........  Mr. Doggett..........      X   ......  .........
Mr. Smith (NE).....................      X   ......  .........  Mr. Thompson.........      X   ......  .........
Mr. Kelly..........................      X   ......  .........  Mr. Larson...........      X   ......  .........
Mr. Schweikert.....................      X   ......  .........  Mr. Blumenauer.......      X   ......  .........
Mr. LaHood.........................      X   ......  .........  Mr. Pascrell.........      X   ......  .........
Dr. Wenstrup.......................      X   ......  .........  Mr. Davis............  ......  ......  .........
Mr. Arrington......................  ......  ......  .........  Ms. Sanchez..........  ......  ......  .........
Dr. Ferguson.......................      X   ......  .........  Ms. Sewell...........      X   ......  .........
Mr. Estes..........................      X   ......  .........  Ms. DelBene..........      X   ......  .........
Mr. Smucker........................      X   ......  .........  Ms. Chu..............      X   ......  .........
Mr. Hern...........................      X   ......  .........  Ms. Moore............      X   ......  .........
Ms. Miller.........................  ......  ......  .........  Mr. Kildee...........      X   ......  .........
Dr. Murphy.........................      X   ......  .........  Mr. Beyer............      X   ......  .........
Mr. Kustoff........................      X   ......  .........  Mr. Evans............  ......  ......  .........
Mr. Fitzpatrick....................      X   ......  .........  Mr. Schneider........      X   ......  .........
Mr. Steube.........................      X   ......  .........  Mr. Panetta..........      X   ......  .........
Ms. Tenney.........................      X   ......  .........  Mr. Gomez............      X   ......  .........
Mrs. Fischbach.....................      X   ......  .........
Mr. Moore..........................      X   ......  .........
Mrs. Steel.........................      X   ......  .........
Ms. Van Duyne......................      X   ......  .........
Mr. Feenstra.......................      X   ......  .........
Ms. Malliotakis....................      X   ......  .........
Mr. Carey..........................      X   ......  .........
----------------------------------------------------------------------------------------------------------------

                     IV. BUDGET EFFECTS OF THE BILL


               A. Committee Estimate of Budgetary Effects

    With respect to clause 3(d) of rule XIII of the Rules of 
the House of Representatives, a cost estimate provided by the 
Congressional Budget Office pursuant to section 402 of the 
Congressional Budget Act of 1974 is attached below.

B. Statement Regarding New Budget Authority and Tax Expenditures Budget 
                               Authority

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee states that the 
bill involved no new or increased budget authority. The 
Committee states further that the bill involves no new or 
increased tax expenditures.

      V. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause (3)(c)(3) of rule XIII of the Rules 
of the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the cost estimate prepared by 
the Congressional Budget Office is attached.




    H.R. 8290 would require tax-exempt organizations to include 
certain information regarding grants they provide to foreign 
entities in their annual tax filings. Under current law, tax-
exempt organizations must report foreign grant information to 
the Internal Revenue Service (IRS) but such information may be 
provided in aggregate and not on a per-recipient basis. H.R. 
8290 would require the name and address of the foreign entity, 
the aggregate amount of grants or other assistance provided to 
the foreign entity during the year, and whether the foreign 
entity is a charity.
    The Congressional Budget Act of 1974, as amended, 
stipulates that revenue estimates provided by the staff of the 
Joint Committee on Taxation (JCT) will be the official 
estimates for all tax legislation considered by the Congress. 
As such, CBO incorporates those estimates into its cost 
estimates of the effects of legislation. All of the estimates 
for the revenue provisions of H.R. 8290 were provided by 
JCT.\1\
---------------------------------------------------------------------------
    \1\See Joint Committee on Taxation, Description of the Chairman's 
Amendment in the Nature of a Substitute to H.R. 8290, The ``Foreign 
Grant Reporting Act'', JCX-20-24 (May 14, 2024), https://www.jct.gov/
publications/2024/jcx-20-24/, and Description of H.R. 8290, The 
``Foreign Grant Reporting Act'', JCX-15-24 (May 13, 2024), https://
www.jct.gov/publications/2024/jcx-15-24/.
---------------------------------------------------------------------------
    For this estimate, CBO and JCT assume that the bill will be 
enacted in fiscal year 2024.
    JCT estimates that enacting H.R. 8290 would result in a 
negligible increase in revenues over the 2024-2034 period.
    CBO estimates that implementing H.R. 8290 would increase 
administrative costs for the IRS by less than $500,000 over the 
2024-2029 period; any related spending would be subject to the 
availability of appropriated funds.
    The CBO staff contact for this estimate is Nathaniel 
Frentz. The estimate was reviewed by John McClelland, Director 
of Tax Analysis.
                                         Phillip L. Swagel,
                             Director, Congressional Budget Office.

     VI. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE


          A. Committee Oversight Findings and Recommendations

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives, the Committee made findings and 
recommendations that are reflected in this report.

        B. Statement of General Performance Goals and Objectives

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
bill does not authorize funding, so no statement of general 
performance goals and objectives is required.

              C. Information Relating to Unfunded Mandates

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
    The Committee has determined that the bill does not contain 
Federal mandates on the private sector. The Committee has 
determined that the bill does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

            D. Applicability of House Rule XXI, Clause 5(b)

    Rule XXI 5(b) of the Rules of the House of Representatives 
provides, in part, that ``A bill or joint resolution, 
amendment, or conference report carrying a Federal income tax 
rate increase may not be considered as passed or agreed to 
unless so determined by a vote of not less than three-fifths of 
the Members voting, a quorum being present.'' The Committee has 
carefully reviewed the bill, and states that the bill does not 
provide such a Federal income tax rate increase.

                       E. Tax Complexity Analysis

    Section 4022(b) of the Internal Revenue Service Reform and 
Restructuring Act of 1998 (``IRS Reform Act'') requires the 
staff of the Joint Committee on Taxation (in consultation with 
the Internal Revenue Service and the Treasury Department) to 
provide a tax complexity analysis. The complexity analysis is 
required for all legislation reported by the Senate Committee 
on Finance, the House Committee on Ways and Means, or any 
committee of conference if the legislation includes a provision 
that directly or indirectly amends the Internal Revenue Code 
and has widespread applicability to individuals or small 
businesses. The staff of the Joint Committee on Taxation has 
determined that there are no provisions that are of widespread 
applicability to individuals or small businesses.

  F. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
                                Benefits

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provisions of the bill, and states that the provisions of 
the bill do not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits within the meaning of the 
rule.

                   G. Duplication of Federal Programs

    In compliance with clause 3(c)(5) of rule XIII of the Rules 
of the House of Representatives, the Committee states that no 
provision of the bill establishes or reauthorizes: (1) a 
program of the Federal Government known to be duplicative of 
another Federal program; (2) a program included in any report 
from the Government Accountability Office to Congress pursuant 
to section 21 of Public Law 111-139; or (3) a program related 
to a program identified in the most recent Catalog of Federal 
Domestic Assistance, published pursuant to the Federal Program 
Information Act (Pub. L. No. 95-220, as amended by Pub. L. No. 
98-169).

       VII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, and existing law in which no 
change is proposed is shown in roman):

                     INTERNAL REVENUE CODE OF 1986



           *       *       *       *       *       *       *
Subtitle F--Procedure and Administration

           *       *       *       *       *       *       *


CHAPTER 61--INFORMATION AND RETURNS

           *       *       *       *       *       *       *


Subchapter A--RETURNS AND RECORDS

           *       *       *       *       *       *       *


PART III--INFORMATION RETURNS

           *       *       *       *       *       *       *


Subpart A--INFORMATION CONCERNING PERSONS SUBJECT TO SPECIAL PROVISIONS

           *       *       *       *       *       *       *


SEC. 6033. RETURNS BY EXEMPT ORGANIZATIONS.

  (a) Organizations required to file.--
          (1) In general.--Except as provided in paragraph (3), 
        every organization exempt from taxation under section 
        501(a) shall file an annual return, stating 
        specifically the items of gross income, receipts, and 
        disbursements, and such other information for the 
        purpose of carrying out the internal revenue laws as 
        the Secretary may by forms or regulations prescribe, 
        and shall keep such records, render under oath such 
        statements, make such other returns, and comply with 
        such rules and regulations as the Secretary may from 
        time to time prescribe; except that, in the discretion 
        of the Secretary, any organization described in section 
        401(a) may be relieved from stating in its return any 
        information which is reported in returns filed by the 
        employer which established such organization.
          (2) Being a party to certain reportable 
        transactions.--Every tax-exempt entity described in 
        section 4965(c) shall file (in such form and manner and 
        at such time as determined by the Secretary) a 
        disclosure of--
                  (A) such entity's being a party to any 
                prohibited tax shelter transaction (as defined 
                in section 4965(e)), and
                  (B) the identity of any other party to such 
                transaction which is known by such tax-exempt 
                entity.
          (3) Exceptions from filing.--
                  (A) Mandatory exceptions.--Paragraph (1) 
                shall not apply to--
                          (i) churches, their integrated 
                        auxiliaries, and conventions or 
                        associations of churches,
                          (ii) any organization (other than a 
                        private foundation, as defined in 
                        section 509(a)) described in 
                        subparagraph (C), the gross receipts of 
                        which in each taxable year are normally 
                        not more than $5,000, or
                          (iii) the exclusively religious 
                        activities of any religious order.
                  (B) Discretionary exceptions.--The Secretary 
                may relieve any organization required under 
                paragraph (1) (other than an organization 
                described in section 509(a)(3)) to file an 
                information return from filing such a return 
                where he determines that such filing is not 
                necessary to the efficient administration of 
                the internal revenue laws.
                  (C) Certain organizations.--The organizations 
                referred to in subparagraph (A)(ii) are--
                          (i) a religious organization 
                        described in section 501(c)(3);
                          (ii) an educational organization 
                        described in section 170(b)(1)(A)(ii);
                          (iii) a charitable organization, or 
                        an organization for the prevention of 
                        cruelty to children or animals, 
                        described in section 501(c)(3), if such 
                        organization is supported, in whole or 
                        in part, by funds contributed by the 
                        United States or any State or political 
                        subdivision thereof, or is primarily 
                        supported by contributions of the 
                        general public;
                          (iv) an organization described in 
                        section 501(c)(3), if such organization 
                        is operated, supervised, or controlled 
                        by or in connection with a religious 
                        organization described in clause (i);
                          (v) an organization described in 
                        section 501(c)(8); and
                          (vi) an organization described in 
                        section 501(c)(1), if such organization 
                        is a corporation wholly owned by the 
                        United States or any agency or 
                        instrumentality thereof, or a wholly-
                        owned subsidiary of such a corporation.
  (b) Certain organizations described in section 501(c)(3).--
Every organization described in section 501(c)(3) which is 
subject to the requirements of subsection (a) shall furnish 
annually information, at such time and in such manner as the 
Secretary may by forms or regulations prescribe, setting 
forth--
          (1) its gross income for the year,
          (2) its expenses attributable to such income and 
        incurred within the year,
          (3) its disbursements within the year for the 
        purposes for which it is exempt,
          (4) a balance sheet showing its assets, liabilities, 
        and net worth as of the beginning of such year,
          (5) the total of the contributions and gifts received 
        by it during the year, and the names and addresses of 
        all substantial contributors,
          (6) the names and addresses of its foundation 
        managers (within the meaning of section 4946(b)(1)) and 
        highly compensated employees,
          (7) the compensation and other payments made during 
        the year to each individual described in paragraph (6),
          (8) in the case of an organization with respect to 
        which an election under section 501(h) is effective for 
        the taxable year, the following amounts for such 
        organization for such taxable year:
                  (A) the lobbying expenditures (as defined in 
                section 4911(c)(1)),
                  (B) the lobbying nontaxable amount (as 
                defined in section 4911(c)(2)),
                  (C) the grass roots expenditures (as defined 
                in section 4911(c)(3)), and
                  (D) the grass roots nontaxable amount (as 
                defined in section 4911(c)(4)),
          (9) such other information with respect to direct or 
        indirect transfers to, and other direct or indirect 
        transactions and relationships with, other 
        organizations described in section 501(c) (other than 
        paragraph (3) thereof) or section 527 as the Secretary 
        may require to prevent--
                  (A) diversion of funds from the 
                organization's exempt purpose, or
                  (B) misallocation of revenues or expenses,
          (10) the respective amounts (if any) of the taxes 
        imposed on the organization, or any organization 
        manager of the organization, during the taxable year 
        under any of the following provisions (and the 
        respective amounts (if any) of reimbursements paid by 
        the organization during the taxable year with respect 
        to taxes imposed on any such organization manager under 
        any of such provisions):
                  (A) section 4911 (relating to tax on excess 
                expenditures to influence legislation),
                  (B) section 4912 (relating to tax on 
                disqualifying lobbying expenditures of certain 
                organizations),
                  (C) section 4955 (relating to taxes on 
                political expenditures of section 501(c)(3) 
                organizations), except to the extent that, by 
                reason of section 4962, the taxes imposed under 
                such section are not required to be paid or are 
                credited or refunded, and
                  (D) section 4959 (relating to taxes on 
                failures by hospital organizations),
          (11) the respective amounts (if any) of--
                  (A) the taxes imposed with respect to the 
                organization on any organization manager, or 
                any disqualified person, during the taxable 
                year under section 4958 (relating to taxes on 
                private excess benefit from certain charitable 
                organizations), and
                  (B) reimbursements paid by the organization 
                during the taxable year with respect to taxes 
                imposed under such section,
        except to the extent that, by reason of section 4962, 
        the taxes imposed under such section are not required 
        to be paid or are credited or refunded,
          (12) such information as the Secretary may require 
        with respect to any excess benefit transaction (as 
        defined in section 4958),
          (13) such information with respect to disqualified 
        persons as the Secretary may prescribe,
          (14) such information as the Secretary may require 
        with respect to disaster relief activities,
          (15) in the case of an organization to which the 
        requirements of section 501(r) apply for the taxable 
        year--
                  (A) a description of how the organization is 
                addressing the needs identified in each 
                community health needs assessment conducted 
                under section 501(r)(3) and a description of 
                any such needs that are not being addressed 
                together with the reasons why such needs are 
                not being addressed, and
                  (B) the audited financial statements of such 
                organization (or, in the case of an 
                organization the financial statements of which 
                are included in a consolidated financial 
                statement with other organizations, such 
                consolidated financial statement), and
          (16) such other information for purposes of carrying 
        out the internal revenue laws as the Secretary may 
        require.
For purposes of paragraph (8), if section 4911(f) applies to 
the organization for the taxable year, such organization shall 
furnish the amounts with respect to the affiliated group as 
well as with respect to such organization.
  (c) Additional provisions relating to private foundations.--
In the case of an organization which is a private foundation 
(within the meaning of section 509(a))--
          (1) the Secretary shall by regulations provide that 
        the private foundation shall include in its annual 
        return under this section such information (not 
        required to be furnished by subsection (b) or the forms 
        or regulations prescribed thereunder) as would have 
        been required to be furnished under section 6056 
        (relating to annual reports by private foundations) as 
        such section 6056 was in effect on January 1, 1979, and
          (2) the foundation managers shall furnish copies of 
        the annual return under this section to such State 
        officials, at such times, and under such conditions, as 
        the Secretary may by regulations prescribe.
Nothing in paragraph (1) shall require the inclusion of the 
name and address of any recipient (other than a disqualified 
person within the meaning of section 4946) of 1 or more 
charitable gifts or grants made by the foundation to such 
recipient as an indigent or needy person if the aggregate of 
such gifts or grants made by the foundation to such recipient 
during the year does not exceed $1,000.
  (d) Section to apply to nonexempt charitable trusts and 
nonexempt private foundations.--The following organizations 
shall comply with the requirements of this section in the same 
manner as organizations described in section 501(c)(3) which 
are exempt from tax under section 501(a):
          (1) Nonexempt charitable trusts.--A trust described 
        in section 4947(a)(1) (relating to nonexempt charitable 
        trusts).
          (2) Nonexempt private foundations.--A private 
        foundation which is not exempt from tax under section 
        501(a).
  (e) Special rules relating to lobbying activities.--
          (1) Reporting requirements.--
                  (A) In general.--If this subsection applies 
                to an organization for any taxable year, such 
                organization--
                          (i) shall include on any return 
                        required to be filed under subsection 
                        (a) for such year information setting 
                        forth the total expenditures of the 
                        organization to which section 162(e)(1) 
                        applies and the total amount of the 
                        dues or other similar amounts paid to 
                        the organization to which such 
                        expenditures are allocable, and
                          (ii) except as provided in paragraphs 
                        (2)(A)(i) and (3), shall, at the time 
                        of assessment or payment of such dues 
                        or other similar amounts, provide 
                        notice to each person making such 
                        payment which contains a reasonable 
                        estimate of the portion of such dues or 
                        other similar amounts to which such 
                        expenditures are so allocable.
                  (B) Organizations to which subsection 
                applies.--
                          (i) In general.--This subsection 
                        shall apply to any organization which 
                        is exempt from taxation under section 
                        501 other than an organization 
                        described in section 501(c)(3).
                          (ii) Special rule for in-house 
                        expenditures.--This subsection shall 
                        not apply to the in-house expenditures 
                        (within the meaning of section 
                        162(e)(4)(B)(ii)) of an organization 
                        for a taxable year if such expenditures 
                        do not exceed $2,000. In determining 
                        whether a taxpayer exceeds the $2,000 
                        limit under this clause, there shall 
                        not be taken into account overhead 
                        costs otherwise allocable to activities 
                        described in subparagraphs (A) and (D) 
                        of section 162(e)(1).
                          (iii) Coordination with section 
                        527(f).--This subsection shall not 
                        apply to any amount on which tax is 
                        imposed by reason of section 527(f).
                  (C) Allocation.--For purposes of this 
                paragraph--
                          (i) In general.--Expenditures to 
                        which section 162(e)(1) applies shall 
                        be treated as paid out of dues or other 
                        similar amounts to the extent thereof.
                          (ii) Carryover of lobbying 
                        expenditures in excess of dues.--If 
                        expenditures to which section 162(e)(1) 
                        applies exceed the dues or other 
                        similar amounts for any taxable year, 
                        such excess shall be treated as 
                        expenditures to which section 162(e)(1) 
                        applies which are paid or incurred by 
                        the organization during the following 
                        taxable year.
          (2) Tax imposed where organization does not notify.--
                  (A) In general.--If an organization--
                          (i) elects not to provide the notices 
                        described in paragraph (1)(A) for any 
                        taxable year, or
                          (ii) fails to include in such notices 
                        the amount allocable to expenditures to 
                        which section 162(e)(1) applies 
                        (determined on the basis of actual 
                        amounts rather than the reasonable 
                        estimates under paragraph (1)(A)(ii)),
                then there is hereby imposed on such 
                organization for such taxable year a tax in an 
                amount equal to the product of the highest rate 
                of tax imposed by section 11 for the taxable 
                year and the aggregate amount not included in 
                such notices by reason of such election or 
                failure.
                  (B) Waiver where future adjustments made.--
                The Secretary may waive the tax imposed by 
                subparagraph (A)(ii) for any taxable year if 
                the organization agrees to adjust its estimates 
                under paragraph (1)(A)(ii) for the following 
                taxable year to correct any failures.
                  (C) Tax treated as income tax.--For purposes 
                of this title, the tax imposed by subparagraph 
                (A) shall be treated in the same manner as a 
                tax imposed by chapter 1 (relating to income 
                taxes).
          (3) Exception where dues generally nondeductible.--
        Paragraph (1)(A) shall not apply to an organization 
        which establishes to the satisfaction of the Secretary 
        that substantially all of the dues or other similar 
        amounts paid by persons to such organization are not 
        deductible without regard to section 162(e).
  (f) Certain organizations described in section 501(c)(4).--
Every organization described in section 501(c)(4) which is 
subject to the requirements of subsection (a) shall include on 
the return required under subsection (a)--
          (1) the information referred to in paragraphs (11), 
        (12) and (13) of subsection (b) with respect to such 
        organization, and
          (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).
  (g) Returns required by political organizations.--
          (1) In general.--This section shall apply to a 
        political 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 preceding 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 
                complying 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 subsection.
          (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,
                  (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 section 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) Discretionary 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.
  (h) Controlling organizations.--Each controlling organization 
(within the meaning of section 512(b)(13)) which is subject to 
the requirements of subsection (a) shall include on the return 
required under subsection (a)--
          (1) any interest, annuities, royalties, or rents 
        received from each controlled entity (within the 
        meaning of section 512(b)(13)),
          (2) any loans made to each such controlled entity, 
        and
          (3) any transfers of funds between such controlling 
        organization and each such controlled entity.
  (i) Additional notification requirements.--Any organization 
the gross receipts of which in any taxable year result in such 
organization being referred to in subsection (a)(3)(A)(ii) or 
(a)(3)(B)--
          (1) shall furnish annually, in electronic form, and 
        at such time and in such manner as the Secretary may by 
        regulations prescribe, information setting forth--
                  (A) the legal name of the organization,
                  (B) any name under which such organization 
                operates or does business,
                  (C) the organization's mailing address and 
                Internet web site address (if any),
                  (D) the organization's taxpayer 
                identification number,
                  (E) the name and address of a principal 
                officer, and
                  (F) evidence of the continuing basis for the 
                organization's exemption from the filing 
                requirements under subsection (a)(1), and
          (2) upon the termination of the existence of the 
        organization, shall furnish notice of such termination.
  (j) Loss of exempt status for failure to file return or 
notice.--
          (1) In general.--
                  (A) Notice.--If an organization described in 
                subsection (a)(1) or (i) fails to file the 
                annual return or notice required under either 
                subsection for 2 consecutive years, the 
                Secretary shall notify the organization--
                          (i) that the Internal Revenue Service 
                        has no record of such a return or 
                        notice from such organization for 2 
                        consecutive years, and
                          (ii) about the revocation that will 
                        occur under subparagraph (B) if the 
                        organization fails to file such a 
                        return or notice by the due date for 
                        the next such return or notice required 
                        to be filed.
                The notification under the preceding sentence 
                shall include information about how to comply 
                with the filing requirements under subsections 
                (a)(1) and (i).
                  (B) Revocation.--If an organization described 
                in subsection (a)(1) or (i) fails to file an 
                annual return or notice required under either 
                subsection for 3 consecutive years, such 
                organization's status as an organization exempt 
                from tax under section 501(a) shall be 
                considered revoked on and after the date set by 
                the Secretary for the filing of the third 
                annual return or notice. The Secretary shall 
                publish and maintain a list of any organization 
                the status of which is so revoked.
          (2) Application necessary for reinstatement.--Any 
        organization the tax-exempt status of which is revoked 
        under paragraph (1) must apply in order to obtain 
        reinstatement of such status regardless of whether such 
        organization was originally required to make such an 
        application.
          (3) Retroactive reinstatement if reasonable cause 
        shown for failure.--If, upon application for 
        reinstatement of status as an organization exempt from 
        tax under section 501(a), an organization described in 
        paragraph (1) can show to the satisfaction of the 
        Secretary evidence of reasonable cause for the failure 
        described in such paragraph, the organization's exempt 
        status may, in the discretion of the Secretary, be 
        reinstated effective from the date of the revocation 
        under such paragraph.
  (k) Additional provisions relating to sponsoring 
organizations.--Every organization described in section 
4966(d)(1) shall, on the return required under subsection (a) 
for the taxable year--
          (1) list the total number of donor advised funds (as 
        defined in section 4966(d)(2)) it owns at the end of 
        such taxable year,
          (2) indicate the aggregate value of assets held in 
        such funds at the end of such taxable year, and
          (3) indicate the aggregate contributions to and 
        grants made from such funds during such taxable year.
  (l) Additional provisions relating to supporting 
organizations.--Every organization described in section 
509(a)(3) shall, on the return required under subsection (a)--
          (1) list the supported organizations (as defined in 
        section 509(f)(3)) with respect to which such 
        organization provides support,
          (2) indicate whether the organization meets the 
        requirements of clause (i), (ii), or (iii) of section 
        509(a)(3)(B), and
          (3) certify that the organization meets the 
        requirements of section 509(a)(3)(C).
  (m) Additional information required from CO-OP insurers.--An 
organization described in section 501(c)(29) shall include on 
the return required under subsection (a) the following 
information:
          (1) The amount of the reserves required by each State 
        in which the organization is licensed to issue 
        qualified health plans.
          (2) The amount of reserves on hand.
  (n) Mandatory electronic filing.--Any organization required 
to file a return under this section shall file such return in 
electronic form.
  (o) Requirement To Report Certain Information With Respect to 
Grants to Foreign Entities.--
          (1) In general.--If an organization described in 
        section 501(c) which files an annual return under 
        subsection (a) is required to include in such return 
        information regarding any grant or other assistance 
        provided by such organization to any foreign entity, 
        such organization shall include in such return (in 
        addition to the information so required to be included) 
        the following information:
                  (A) The name and address of such foreign 
                entity.
                  (B) The aggregate amount of such grants or 
                other assistance provided to such foreign 
                entity during the year.
                  (C) Whether such foreign entity is described 
                in each of the following clauses:
                          (i) An entity recognized as a charity 
                        by the foreign country in which such 
                        entity is organized.
                          (ii) An organization described in 
                        section 501(c)(3) and exempt from tax 
                        under section 501(a).
                          (iii) An organization with respect to 
                        which the organization making the 
                        return under subsection (a) has made a 
                        good faith determination that the 
                        foreign entity is an organization 
                        described in section 4945(d)(4)(A).
                          (iv) An organization which is not 
                        described in clause (i), (ii), or 
                        (iii).
          (2) Foreign entity.--For purposes of this subsection, 
        the term ``foreign entity'' means any organization or 
        entity created or organized outside the United States. 
        For purposes of the preceding sentence, the term 
        ``United States'' includes the possessions of the 
        United States.
          (3) Indirect contributions.--In the case of any grant 
        or other contribution made indirectly to any foreign 
        entity, the information required to be reported under 
        paragraph (1) shall be reported with respect to each 
        person to which such grant or other contribution is 
        made directly or indirectly.
  [(o)] (p) Cross references.--For provisions relating to 
statements, etc., regarding exempt status of organizations, see 
section 6001.
  For reporting requirements as to certain liquidations, 
dissolutions, terminations, and contractions, see section 
6043(b). For provisions relating to penalties for failure to 
file a return required by this section, see section 6652(c).
  For provisions relating to information required in connection 
with certain plans of deferred compensation, see section 6058.

           *       *       *       *       *       *       *


                         VIII. ADDITIONAL VIEWS

                          House of Representatives,
                               Committee on Ways and Means,
                                      Washington, DC, June 5, 2024.
    This bill amends the Internal Revenue Code to require 
certain tax-exempt organizations to include information 
regarding grants or other assistance made directly or 
indirectly to any foreign entity on their annual returns. The 
bill does not define when a grant is made ``indirectly'' for 
this purpose. Committee Democrats believe that such ambiguity 
can lead to unintended consequences for tax-exempt 
organizations attempting to comply with the law. An amendment 
was offered to define ``indirectly'' in this context, which the 
Majority did not accept. A clear definition would benefit tax-
exempt organizations and lead to better compliance and tax 
administration. The bill should be amended to define 
``indirectly'' and address other concerns as it moves through 
the legislative process.

                                           Richard E. Neal,
                                                    Ranking Member.
                              ----------                              

    Tax-exempt organizations play a vital role in our 
communities, touching every corner. From education to the arts 
to medical research to social services, these organizations 
step up to fill unmet needs and work toward the common good.
    Its' reasonable to expect transparency around their 
grantmaking given their tax status. Foreign and domestic grant 
reporting requirements should be the same. While I always have 
a degree of skepticism around the origins and intent of my 
colleagues' legislation, the public should know about an 
organization's grant recipients.
    I plan to support this legislation.
                                           Richard E. Neal,
                                                    Ranking Member.

                                  [all]