IRS Proposal Would Curb Nonprofits’ Campaigning


WASHINGTON (UPI) — The Internal Revenue Service has proposed rules to restrict spending by groups listed as nonprofits under of the U.S. tax code on a range of campaign-related activities.

The rules, proposed Tuesday, could help curb the increase in political spending by nonprofit groups, such as conservative Crossroads GPS and the liberal Priorities USA, while presenting clearer standards that could help government auditors avoid future confrontations with politically active organizations, The Wall Street Journal reported.

The proposed rules were announced about six months after the IRS was slammed by Congressional Republicans for unfairly targeting Tea Party-affiliated groups seeking tax-exempt status.

“This proposed guidance is a first critical step toward creating clear-cut definitions of political activity by tax-exempt social welfare organizations,” said Mark Mazur, the Treasury Department’s assistant secretary for tax policy, explaining the goal of the rules was to “ensure that the standards for tax-exemption are clear and can be applied consistently.”

The proposal would curb an array of campaign activities by tax-exempt organizations set up under section 501(c)(4) of the tax code. Currently, such groups have few clear-cut rules governing their campaign activities, other than they can’t exist “primarily” to influence elections, the Journal said.

The proposed guidance would better define what types of activities are considered political — and what are not — in determining whether a nonprofit is focused primarily on influencing campaigns.

Treasury officials said the new rules likely won’t be in place until after the 2014 elections.

Critics said the rules appeared to be an attempt to curtail the influence of wealthy interest groups, the Journal said.

“At first glance, it appears like a blatant abuse of the tax code designed to muzzle the American people’s free speech rights,” a National Rifle Association spokesman said.

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