TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Wednesday, December 16, 2015

The IRS Scandal, Day 951

IRS Logo 2Wall Street Journal editorial, The IRS Targets Political Donors:

The IRS regulatory assault on political nonprofits continues, albeit out of the media glare. In September the Internal Revenue Service and Treasury Department proposed a rule to give 501(c)(3) charities the “option” of filing detailed reports on every donor who contributes more than $250. These reports would include names, addresses and Social Security numbers. Oh, oh.

While the IRS says the rule is “voluntary,” in government that’s often a prelude to compulsory. The legitimate fear in the nonprofit world, on the right and left, is that this is a first step toward making such donor lists mandatory, and then applying the requirement to every nonprofit—including the conservative social-welfare organizations that the IRS helped to shut down in the 2012 presidential election. ...

Many taxpayers will also lack confidence that nonprofits, which are often small operations staffed by volunteers, can safeguard their information. The proposed regulation is an invitation to fraud and identity theft by creating an opportunity for scam artists to claim to be charities and solicit Social Security numbers.

This year the IRS was forced by public outrage to shelve a different regulation that sought to limit the amount of political activity social-welfare organizations can engage in. The new rule looks like an attempt to achieve a similar result by drying up contributions. The rule’s public comment period ends Wednesday, but Democrats and Republicans in Congress should work together to put this one on ice.

https://taxprof.typepad.com/taxprof_blog/2015/12/the-irs-scandal-day-951.html

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Comments

Government believes in transparency ... for anyone and everything but itself.

Posted by: ruralcounsel | Dec 16, 2015 5:34:13 AM

Some commenters indicated concern over the IRS having their Social Security Numbers (which is absurd because the IRS already has that for anyone who's filed a tax return), but this article makes a much better argument that this will require charities to collect this data, which is a much bigger problem. Charities shouldn't be required to collect and then have to protect this sensitive data from all of its donors. A simple name and address is more than sufficient for purposes of tracking the accuracy of charitable donations.

Posted by: anon | Dec 16, 2015 5:47:50 AM

If a Republican administration were in power this would be Big News in the MSM. Democrats get full media protection. Dems sure got it good.

Posted by: VoteOutIncumbents | Dec 16, 2015 8:09:58 AM

Paul -thanks so much for your hard work keeping this issue in front of the public. You're a true patriot.

Posted by: Bill Hocter | Dec 16, 2015 9:27:16 AM