The Supreme Court is being asked to determine whether California’s ambitious Attorney General and candidate for U.S. Senate, Kamala Harris, has violated the First Amendment and federal law protecting confidential tax return information.

Harris is California’s top charity regulator, and has been delegated broad, unbridled discretion to tell charities and nonprofit advocacy groups what they must file to obtain a license to speak with potential and existing donors.

Nonprofit organizations are some of the most effective critics of government, other powerful institutions -- and ambitious politicians -- making them especially vulnerable to the desire to bully and censor them. The Lois Lerner/IRS scandal is a good example.

Harris decided to push the limits by telling charities that they may not solicit contributions unless they first file a list of their top donors, which is an extortionate prior restraint on speech. Those donors are found on a confidential “Schedule B” to the tax returns filed by nonprofits with the IRS. 

Federal law protects confidential tax return information, and even provides civil and criminal penalties against federal and state officials who violate the confidentiality law.  The IRS was ordered to pay the National Organization for Marriage for disclosing that organization’s Schedule B donor information to hostile blogs.

As or even more importantly, what Harris is doing flies in the face of the 1958 landmark Supreme Court decision in NAACP v. Alabama. That case held that membership lists are protected by the First Amendment from demands of states and their attorneys general.

The petition for the court to hear this case filed by the Center for Competitive Politics will be supported by an amicus brief filed by the Free Speech Coalition of Virginia, along with dozens of policy advocacy groups, and even charities such as animal sanctuaries. 501(c)(3) and 501(c)(4) nonprofit organizations may still add their name to the amicus brief in what may be a landmark case protecting privacy and rights of private association.

Here is a clip from the amicus brief to be filed explaining the collaboration between Lois Lerner and state charity officials:

A bipartisan report of the Senate Finance Committee about the Internal Revenue Service’s treatment of nonprofit organizations, issued August 5, 2015, references various unlawful disclosures of confidential tax information by the IRS, including the Form 990 Schedule B information of the National Organization of Marriage.[1]

Recent publicized violations of disclosure of confidential tax return information by the IRS -- and of course what is publicized is based only on the times that the IRS was caught -- demonstrate that even the federal service with its supposedly sophisticated guards of confidentiality is untrustworthy.  It defies logic to believe that state attorneys general, a partisan elected position subject to the temptations and whims of partisan politics no matter how dedicated and professional, would have better safeguards of such confidential tax return information.

*****

It should be noted that controversial former IRS official Lois Lerner collaborated extensively about Form 990 information and enforcement issues with state charitable solicitation officials and their umbrella organization, the National Association of State Charity Officials (NASCO), an affiliate of the National Association of Attorneys General (NAAG).

At the same time her Tax Exempt division at the IRS was engaging in ideologically discriminatory policies, Ms. Lerner was collaborating with state officials to help “ramp up” their regulation of nonprofit organizations.  As reported in the BNA Daily Tax Report  (“States Ramp Up Regulation of Nonprofits – With Help from the Feds”):

The increase in federal-state cooperation is not imagined, but confirmed by both federal and state officials.  According to both Lois Lerner, IRS Director, Exempt Organizations, and Mark Pacella, chief deputy attorney of the Pennsylvania Attorney General’s Office, information sharing between the IRS and state AGs is ramping up.  Over the past four years, Lerner said in April, state charity oversight officials referred 600 organizations to the IRS, and 90 percent of those referrals led to examinations.

And as reported at CNSNews.com:[2] “In her Exempt Organizations 2011 Annual Report, Ms. Lerner touts a proposed rulemaking … to reduce barriers to states’ participation in the [IRS’] information-sharing program * * *  Lerner explained that the IRS expected to have regular interaction with NASCO about the new filing and monitor trends that arise with the new Form 990 and hoped the feedback would help shape future adjustments.”

Ms. Lerner collaborated with state charity officials on her office’s redesign of IRS Form 990, noting their existing “compliance relationship” would increase.  As reported in 2009 by The NonProfit Times:[3]

Overall, the Form 900 is going to provide state charity regulators with a lot more information, “particularly in the areas of governance and also compensation issues because although the states and the IRS have two different jurisdictions, many of the things that we are looking at are important to the states for different reasons because of their areas of charitable oversight,” said Lois G. Lerner, director of the Exempt Organizations (EO) Division of the IRS. “When you look at the facts we look at to determine whether an organization meets the requirements for tax-exemption, those same facts can also give rise to some of the violations at the state level.”

Lerner explained that the IRS expected to have regular interaction with NASCO about the new filing and monitor trends that arise with the new Form 990 and hoped the feedback would help shape future adjustments. The IRS and state regulators already have a compliance relationship — the IRS can give some information to state regulators about enforcement activities under the Pension Protection Act of 2006, while the state regulators can lead the IRS to potential tax violations. In 2008, EO disclosed nearly 200 enforcement activities to state agencies, including terminations and revocations, and state officials made 83 referrals to EO, including political activities, employment tax and failures in operating within designated exemption status.

The formerly accessible and collaborative Ms. Lerner has since been held in contempt of Congress for refusing to testify about her activities at the center of an IRS scandal involving its treatment of conservative nonprofit organizations and their donors (“House votes to hold Lois Lerner in contempt of Congress,” The Washington Post, May 7, 2014).[4]  Ms. Lerner remains in the news regularly, if not weekly, as information continues to come forth about IRS targeting groups and individuals for apparent ideological reasons (“Lois Lerner Wanted To Audit A Group With Ties To Bristol Palin,” The Daily Caller, August 5, 2015),[5] crass partisan statements (“Lois Lerner Criticized GOP As 'Crazies,' 'Assholes' In Emails,” The Huffington Post, September 29, 2014),[6] and various alleged lawless abuses of power.

Which is to say that the presumption of benevolence the court of appeals accorded the government is misplaced.  Information continues to trickle out under congressional investigations,[7] inspector general investigations,[8] private lawsuits,[9] and threats of contempt[10] involving government malevolence towards conservative nonprofits.

[1] THE INTERNAL REVENUE SERVICE’S PROCESSING OF 501(C)(3) AND 501(C)(4) APPLICATIONS FOR TAX-EXEMPT STATUS SUBMITTED BY “POLITICAL ADVOCACY” ORGANIZATIONS FROM 2010-2013, at 136, http://op.bna.com/der.nsf/id/klan-9z4sa5/$File/FINAL%20Bipartisan%20Staff%20Report.pdf

[2] “CA, NY Attorneys General Accused of Violating Donor Confidentiality Laws,” August 2, 2103, http://cnsnews.com/news/article/ca-ny-attorneys-general-accused-violating-donor-confidentiality-laws.

[3] “Attorney General Focusing On Fiduciary Responsibilities,” February 1, 2009, http://www.thenonprofittimes.com/news-articles/attorney-general-focusing-on-fiduciary-responsibilities/

[4] http://www.washingtonpost.com/blogs/post-politics/wp/2014/05/07/house-votes-to-hold-lois-lerner-in-contempt-of-congress.

[5] http://dailycaller.com/2015/08/05/lois-lerner-wanted-to-audit-a-group-with-ties-to-bristol-palin/.

[6] http://www.huffingtonpost.com/2014/07/30/lois-lerner-emails-_n_5634379.html.

[7] See Footnote ___, supra.

[8] ”Treasury Inspector General: ‘Potential Criminal Activity’ Surrounding Lerner Emails,” Breitbat.com, February 27, 2015, http://www.breitbart.com/big-government/2015/02/27/treasury-inspector-general-potential-criminal-activity-surrounding-lerner-emails/.

[9] “Pro-Israel Z Street Trumps IRS in Federal Appellate Court Ruling,” The Jewish Press, June 21, 2015,

http://www.jewishpress.com/news/breaking-news/pro-israel-z-street-trumps-irs-in-federal-appellate-court-ruling/2015/06/21/.

[10] “Federal judge threatens to hold IRS chief in contempt,” FoxNews.com, July 30, 2015, http://www.foxnews.com/politics/2015/07/30/federal-judge-threatens-to-hold-irs-chief-in-contempt/.