IRS delays rules governing political activity for non-profits

Under tremendous pressure from Republicans and some Democrats, the IRS has delayed issuing new rules governing the political activity of non-profit groups. The agency received more than 150,000 comments on the rules - the most in history.

The rules were set to be examined later this summer in a public hearing. Now, that's not going to happen and the new rules definitely won't take effect until after the November mid-terms.

New York Times:

“Given the diversity of views expressed and the volume of substantive input, we have concluded that it would be more efficient and useful to hold a public hearing after we publish the revised proposed regulation,” said Bruce Friedland, an I.R.S. spokesman.

I.R.S. officials have declined to specify when they expect to issue a final rule. In April, the commissioner, John Koskinen, said at a news conference that it was unlikely that the agency would complete the process by the end of 2014.

The original proposal took aim not just at the multimillion-dollar television advertising campaigns mounted by nonprofit groups in recent election years, but also nonpartisan activity like voter registration drives.

Republicans, who have been the chief beneficiaries of nonprofit groups’ spending, have attacked the proposal as an Obama administration effort to squelch the Tea Party and other conservative allies.

But the scope of the draft rules also alarmed some liberals and watchdog groups favoring a broader crackdown on nonprofit groups’ political spending. They sought revisions that would focus on what they considered abuses of tax exemptions by openly partisan organizations seeking to hide the source of their funding. Some liberals also argued that the I.R.S. should broaden the proposal to include more types of tax-exempt groups, like trade associations, that spend heavily on elections but are not required to disclose their donors.

“We’re pleased that the I.R.S. is committed to clarifying the rules for candidate-related political activity by social welfare organizations,” said Miles Rapoport, the president of Common Cause, which backs tighter restrictions on political spending.

Republicans have opposed the agency’s new rules from the beginning, and some of the party’s senior lawmakers praised the agency for backing down.

“Today’s decision is a long overdue step in the right direction,” Senator Orrin Hatch, Republican of Utah, said in a statement. He said the proposed rules, as they now stood, “threatened free speech and the rights of all American citizens to participate in the democratic process.”

Liberals want full discosure of who is donating to conservative groups so they can organize pressure campaigns to get them to stop. Many of these donors are executives or own consumer product companies. The anonymity is necessary to protect them from attacks when they exercise their right of free speech.

The proposed IRS rules, which will now, presumably, be altered, could have been written by the White House political office. They were a dream for Democrats, making previously legal activity of Tea Party groups illegal, stifling the ability of the conservative grass roots to have an impact on elections.

That won't happen in 2014. But gird your loins for battle because the IRS will comeback with another attack next year in advance of the 2016 presidential election.


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