Brunson: Rethinking Public Charities and Political Speech

Samuel D. Brunson (Loyola-Chicago) has posted Rethinking Public Charities and Political Speech on SSRN. Here is the abstract:

In order to maintain their tax-exempt status, public charities are forbidden from campaigning for or against candidates for office. The ban originated in 1954, but was created from whole cloth, with no debate and no legislative history. As a result, it has been controversial, both as to its scope and as to its reason for existing.

Without understanding Congress’s intent in enacting the ban, we are left to debate whether the ban is effective, necessary, or even permissible. This Article argues that the justifications presented for the ban are not compelling, but neither are the arguments against the ban. In the meantime, the ban creates unnecessary complexity in public charities’ tax compliance, is not enforced in its current form, and may discourage taxpayers from fully complying with their tax responsibilities. In light of the harms that may result, this Article argues that we should have the debate that did not occur in 1954, in order to decide whether public charities need to be limited in their ability to campaign, what the scope of such limitation should be, and how it should be enforced.