Overview
Title
To amend the Internal Revenue Code of 1986 to provide for the public reporting of data on certain contributions received by tax-exempt organizations from foreign sources, and for other purposes.
ELI5 AI
H. R. 8293 is a bill that wants to show how much money U.S. non-profit groups get from other countries while keeping the names of the people who give money private, but with some tricky rules about who can know this information.
Summary AI
H. R. 8293 aims to change the Internal Revenue Code to make data on contributions from foreign sources to U.S. tax-exempt organizations publicly available. The bill requires such organizations to report the total amount of foreign contributions they receive, breaking it down by each contributing country. It also seeks to protect the privacy of donors by restricting the government's collection and public disclosure of their identities, with some exceptions for legal and regulatory purposes. Violating these privacy protections could result in severe penalties, including fines and imprisonment.
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AnalysisAI
The proposed legislation, known as the "American Donor Privacy and Foreign Funding Transparency Act," seeks to introduce new requirements around the transparency of foreign contributions to tax-exempt organizations. It entails amendments to the Internal Revenue Code of 1986, mandating these organizations to report contributions received from foreign sources and ensuring this information is publicly accessible in a searchable database. The bill also sets provisions aimed at protecting the privacy of donors by restricting federal entities from collecting and disclosing donor information, with some exceptions outlined for specific government agencies.
General Summary
At its core, this bill aims to increase transparency in the funding of tax-exempt organizations by requiring them to report foreign contributions. It includes definitions and thresholds for what constitutes a "specified tax-exempt organization" to determine applicability. The legislation also embeds protections around the privacy of domestic donors, restricting federal collection and dissemination of such information and setting severe penalties for noncompliance.
Summary of Significant Issues
Several issues arise from the text of the bill, particularly concerning privacy and operational clarity. The requirement for public disclosure of foreign donor information, while meant to enhance transparency, brings significant privacy and security issues that are not fully addressed within the bill's current framework. The references to legal definitions and the absence of enforcement mechanisms add layers of complexity and potential ambiguity, making it harder for organizations to fully understand and comply with the law. Additionally, the exceptions to privacy protections could create loopholes due to ambiguities around what is legally permissible. The penalties are severe but lack clear pathways for how enforcement and prosecution would take place, further complicating the practical application of the law.
Impact on the Public
For the general public, this bill could lead to increased transparency in understanding foreign influences on non-profit organizations. This could allow for more informed decisions about supporting certain causes. Nonetheless, the potential risk of exposing sensitive donor informationâespecially for international donorsâposes security concerns that could discourage contributions or lead to unwanted scrutiny.
Impact on Specific Stakeholders
Tax-Exempt Organizations: These entities may face an added administrative burden to comply with the new reporting requirements. Organizations with significant foreign contributions might experience complex challenges in managing data privacy while balancing the new transparency requirements.
International Donors: There may be hesitation among foreign contributors concerned about privacy and security, which might negatively impact funding streams for certain organizations reliant on international support.
Federal Entities: The bill demands careful navigation of existing legislative standards to ensure compliance. However, lack of clear enforcement mechanisms may lead to challenges in executing their roles effectively.
While the proposed legislation aims to strike a balance between transparency and donor privacy, it unveils potential issues and ambiguity that require further consideration. The bill's effectiveness will largely depend on how these concerns are addressed in final adjustments and implementations.
Financial Assessment
The bill H. R. 8293 involves several key financial elements aimed at improving transparency and protecting donor privacy regarding contributions to tax-exempt organizations.
Financial Thresholds for Tax-Exempt Organizations
The bill requires tax-exempt organizations to publicly report certain contributions from foreign sources. Specifically, it defines a "specified tax exempt organization" as one that must comply with these reporting requirements if its gross receipts equal or exceed $200,000 or if its assets are $500,000 or more at the end of the taxable year. These financial thresholds may appear arbitrary, which is an issue noted in the analysis. Without a clear rationale for these specific numbers, organizations might find themselves uncertain about why they are required to comply, potentially facing disputes or resistance over their inclusion. This raises questions about fairness and the reasons behind choosing these particular financial limits.
Penalties for Violations
There are stringent penalties for federal employees who unlawfully disclose donor information, hinting at significant financial implications. Violations are classified as a felony, with punishment including a fine up to $250,000 and/or up to 5 years of imprisonment. In addition to these penalties, convicted federal employees would also face dismissal or discharge from their position. The inclusion of such hefty fines underscores the importance the legislation places on privacy protection; however, as noted in the issues section, questions remain about who is responsible for prosecuting these offenses. The lack of clarity in enforcement mechanisms could result in inconsistent application of penalties and affects the overall accountability and integrity of the legislation.
Exceptions and Potential Loopholes
The bill outlines exceptions to the restrictions on collecting and disclosing donor identities, allowing certain government entities to access information when acting lawfully. This implies regulatory and possibly financial considerations for organizations that need to navigate these exceptions. The terms and conditions under which these exceptions apply are crucial, as they might create legal gray areas or unintended loopholes, complicating the enforcement of financial provisions and privacy safeguards.
Overall, the financial aspects of bill H. R. 8293 are intricately linked to its larger goals of transparency and privacy. The financial reference points such as compliance thresholds and penalties highlight the bill's intent to establish firm boundaries for organizations and government entities alike while ensuring adherence to privacy standards. However, unresolved questions about enforcement and the rationale for specific financial thresholds indicate areas where the bill might benefit from further clarification or adjustment.
Issues
The requirement for public disclosure of donor information in a searchable database in Section 2(b) raises significant privacy and security concerns for organizations and their international donors. The bill does not specify how these concerns will be addressed, potentially putting sensitive information at risk.
The bill's definition of 'foreign national' in Section 2(a)(1)(A) references the Federal Election Campaign Act of 1971, which may not be directly accessible or clear to readers unfamiliar with the legislation, leading to potential ambiguity and misinterpretation.
There are no specified procedures or mechanisms in Section 3 for enforcing compliance with restrictions on the collection and release of donor information, leading to potential enforcement and accountability issues.
The penalties for violations in Section 3(d) include significant fines and imprisonment, but it lacks clarity on who is responsible for prosecuting such offenses, which could lead to enforcement challenges.
The exceptions to restrictions on collecting and releasing donor information in Section 3(a)(2) and Section 3(b)(2) could introduce ambiguity or create loopholes, especially regarding what qualifies as lawful under specified sections of other laws.
The definitions for 'specified tax exempt organization' in Section 2(a)(3) appear arbitrary due to lack of explanation for the chosen financial thresholds, which could lead to confusion and disputes over which organizations are affected.
The bill's exclusion of political organizations under section 527 in Section 3(c) leaves ambiguity around the treatment of organizations with dual status, potentially complicating enforcement and compliance.
The term 'entity of the Federal Government' in Section 3(a) and Section 3(b) is not specifically defined, leading to confusion about which federal entities are included or excluded from restrictions and responsibilities.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section is about the title given to the law, which is called the âAmerican Donor Privacy and Foreign Funding Transparency Actâ.
2. Annual disclosure of data on contributions received by tax-exempt organizations from foreign sources Read Opens in new tab
Summary AI
The bill requires certain tax-exempt organizations to report contributions from foreign sources, detailing the aggregate amounts and the specific foreign countries involved. Additionally, this information must be made publicly available in a searchable database, and the new requirements apply to tax returns filed for years starting after the bill's enactment.
Money References
- â(1) IN GENERAL.âEvery specified tax exempt organization shall include in the return required to be filed under subsection (a)(1) the following information: â(A) The aggregate amount of contributions received from foreign nationals (as defined in section 319(b) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(b))) during the taxable year. â(B) The aggregate amount described in subparagraph (A) stated separately with respect to each foreign country with respect to which any such contribution was received. â(2) IDENTIFICATION OF FOREIGN COUNTRY OF CONTRIBUTION.âFor purposes of this subsection, the foreign country with respect to which a contribution is received isâ â(A) in the case of a contribution made by an individual, each foreign country of which such individual is a citizen, and â(B) in the case of any other contribution, the foreign country under the laws of which the person making such contribution was created or organized. â(3) SPECIFIED TAX EXEMPT ORGANIZATION.âFor purposes of this subsection, the term âspecified tax exempt organizationâ means, with respect to any taxable year, any organization described in section 501(c) which is required to file an annual return under subsection (a)(1) for such taxable year ifâ â(A) the gross receipts of such organization for such taxable year equal or exceed $200,000, or â(B) the assets of such organization (determined as of the close of such taxable year) equal or exceed $500,000.â. (b) Public disclosure.âSection 6104 of such Code is amended by adding at the end the following new subsection: â(e) Public disclosure of certain information.âThe Secretary shall make publicly available in a searchable database the following information: â(1) The information furnished under section 6033(o) of the Internal Revenue Code of 1986.
3. Protecting privacy of donors to tax-exempt organizations Read Opens in new tab
Summary AI
The section prohibits federal entities from collecting or publicly disclosing information about donors to tax-exempt organizations, with specific exceptions for entities like the IRS and the Federal Election Commission operating under certain legal provisions. Violating these rules can result in severe penalties, including fines and imprisonment.
Money References
- Any violation of this section shall be a felony punishable upon conviction by a fine in any amount not exceeding $250,000, or imprisonment of not more than 5 years, or both, together with the costs of prosecution, and if such offense is committed by any officer or employee of the United States, he shall, in addition to any other punishment, be dismissed from office or discharged from employment upon conviction for such offense.