The short answer is that it had a limited role in the actual German government. But its power lay in its ability to propose legislation.

The Reichstag was composed of 387 deputies elected by all men over the age of 25 via secret ballot. Bismarck designed the Reichstag to have a limited role in his semi constitutional, semi federal system. At the top of the German government was the Kaiser, who in turn picked his Chancellor and his cabinet. Below the Chancellor there were two important government organs: The Bundesrat (a federal council) and the Reichstag.

The Bundesrat was a federal council of all the constituent German states, like Bavaria, Prussia, etc. Each German state was assigned a certain number of delegates based on population, Prussia obviously had the most by far. The Bundesrat was very powerful, it could veto bills passed by the Reichstag, any bill needed the assent of the Federal Council to go into law, and with the Kaiser's agreement, the Federal Council could dissolve parliament.

This was Bismarck's check on the Reichstag, the Prussians dominated the federal council, they were the only state with enough votes to veto a bill on their own, any other state had to convince other delegates to vote with them in order to veto something. Prussia also had all of the North German states under their wing, and thus they could be trusted to vote how Prussia voted. This allowed the Prussian chancellor or Kaiser to effectively counter any bill the democratically elected Reichstag passed.

In terms of what power the Reichstag held, well there main power was being the only body that could draft legislation. The relationship between the Chancellor and the Reichstag was the mainstay of German politics. Bismarck had not intended for the Reichstag to be as independent as it became, but because of universal voting, the Reichstag quickly became a bastion of Socialists and Liberals, this was in direct contrast to the Prussian landtag (parliament), where there was class based voting, ensuring the rich, conservative aristocracy maintained control (even this was challenged later on). There was actually a clause in the German constitution stating that no member of the Reichstag could be a minister for the Kaiser, ensuring that ministers were not accountable to the Reichstag.

In terms of power, the Reichstag could draft legislation, could pass bills, reject them, and amend bills. Really all the powers granted to any other parliament, they were allowed to approve an annual budget. The army was saved from any parliamentary scrutiny, and was pretty much only accountable to the Kaiser and his ministers. The Reichstag did have power over the army's budget, but military appropriations were fixed for several years at a time, and were linked to the size of the army, meaning the one power the Reichstag may have had over the army was essentially neutralized.

This semi-parliamentarian system where in the state had a functioning parliament with all the powers granted to other parliaments around the world, but federal bodies such as the Bundesrat made it essentially toothless is probably one of Bismarck's more impressive achievements, as he managed to keep Prussia as the most powerful organ in the German Empire while still keeping up the charade that everyone had an actual say in the government.