By Nicholas Confessore, The New York Times    "The Obama administration on Tuesday moved to issue new rules that would curtail political activity by tax-exempt nonprofit groups, with potentially significant ramifications for one of the fastest-growing sources of campaign spending.    The proposed rules, announced by the Treasury Department and the Internal Revenue Service, would expand and clarify how the IRS defines political activity and then establish clearer limits for how much activity nonprofits can engage in. Such a change – long urged by government watchdog groups – would be the first wholesale shift in a generation in the regulations governing political activity.    The move to curtail nonprofits follows years of legal and regulatory shifts, such as the Supreme Court’s Citizens United ruling in 2010, that have steadily loosened the rules governing political spending, particularly by big corporations, labor unions and the wealthy .    The rules would not prohibit political activity by nonprofit organizations. But by establishing clearer limits for campaign-related spending, the new rules could have a significant effect on the big-spending nonprofit groups that have played a central role in national politics in recent years, spending hundreds of millions of dollars on political advertising and voter outreach.    The administration’s proposal would apply to nonprofit groups organized under Section 501(c)4 of the tax code, which are permitted tax exemption in exchange for devoting themselves primarily to the promotion of “social welfare,” which under current rules can include some political activity."

 

Comments

LWVTurrill

Guidance for Tax-Exempt Social Welfare Organizations...

As I read these, the proposed rules are a 3-way threat to the way the LWV has traditionally operated as a nonpartisan political organization under the existing 501(c)4 regulations. On pages 28-29 they would define "candidate-related political activities" as including

"(5) Conduct of a voter registration drive or or “get-out-the-vote” drive;...

"(7) Preparation or distribution of a voter guide...; or

"(8) Hosting or conducting an event within 30 days of a primarary election or 60 days of a general election at which one or more candidates in such election appear as part of the program."

It explains these proposed changes with:

"The Treasury Department and the IRS acknowledge that under the facts and circumstances analysis currently used for section 501(c)(4) organizations as well as for section 501(c)(3) organizations, these election-related activities may not be considered political campaign intervention if conducted in a non-partisan and unbiased manner. However, these determinations are highly fact-intensive."

In other words, the IRS does not want to determine if an organization is behaving in a nonpartisan and unbiased manner.

 

Norman Turrill
LWV of Oregon Board Member
former LWVUS Board Member
former LWVUS Agriculture Update Chair
former LWVUS Board Technology Chair
LWVturrill@mac.com
Portland, OR

Carolyn Caywood

Zero tolerance

What I see here is the same sort of thinking that kicks a child out of school for pointing his finger and saying bang.  Essentially, it is an attempt to abdicate responsibility for critical thinking and instead apply one-size-fits-all rules in the manner of Procrustes.  Eventually, all zero tolerance rules expose their administrators to ridicule as they are applied ham-handedly and inspire those subject to the rule to become ever more devious.  If the real issue is that the IRS is too understaffed to deal with all the applications for tax exemption, the answer is not this sort of "minimum sentencing" rulemaking, but rather appropriate levels of funding. 

The entire proposal rests on a desire to "avoid a fact-intensive analysis" and I don't think we can get any useful result based on that premise. 

Kim Abel

Voter Registration?

Has anyone a link to the draft regs?  I saw a report listing limits on voter registration!

That could be a problem.

Kim Abel

LWVWashington

Kim Abel

Voter Registration?

Has anyone a link to the draft regs?  I saw a report listing limits on voter registration!

That could be a problem.

Kim Abel

LWVWashington

Carolyn Caywood

Guidance for Tax-Exempt Social Welfare Organizations...

The initial guidance is expected to be posted on the Federal Register later today.  http://www.treasury.gov/press-center/press-releases/Pages/jl2225.aspx  

which led me to 

Guidance for Tax-Exempt Social Welfare Organizations on Candidate-RelatedPolitical Activities

An unpublished Proposed Rule by the Internal Revenue Service on 11/29/2013. This document has not been published and is only available in PDF format.

https://s3.amazonaws.com/public-inspection.federalregister.gov/2013-28492.pdf

 

Carolyn the librarian  ;-) 

CLee

Careful Reading shows where the problem lies for LWV

I downloaded and read the link on proposed changes.  Beginning on page 22 of the PDF, at 2e. Election-related Activities, there is a definition that encompasses all the LWV voter registration and candidate night activities.  There is also acknowledlgement that there is the possibility these are done in a clearly non-partisan manner and that comments are being sought before implementation. 

These proposed regs are addressing a real problem with 501c(4) organizations, and we need to insist on some nuance in the restrictions, not oppose this wholesale.  That said, it is hard to imagine any version of these regs being implemented that would not have put the "Scott Brown" ads on the wrong side of them.

Clearly the LWVUS and the state leagues all need to speak out on this.  I quote this key section below:

e. Election-related activities
The proposed definition of candidate-related political activity would include
certain specified election-related activities, including the conduct of voter
23
registration and get-out-the-vote drives, distribution of material prepared by or on
behalf of a candidate or section 527 organization, and preparation or distribution
of a voter guide and accompanying material that refers to a candidate or a
political party. In addition, an organization that hosts an event on its premises or
conducts an event off-site within 30 days of a primary election or 60 days of a
general election at which one or more candidates in such election appear as part
of the program (whether or not such appearance was previously scheduled)
would be engaged in candidate-related political activity under the proposed
definition.
The Treasury Department and the IRS acknowledge that under the facts
and circumstances analysis currently used for section 501(c)(4) organizations as
well as for section 501(c)(3) organizations, these election-related activities may
not be considered political campaign intervention if conducted in a non-partisan
and unbiased manner. However, these determinations are highly fact-intensive.
The Treasury Department and the IRS request comments on whether any
particular activities conducted by section 501(c)(4) organizations should be
excepted from the definition of candidate-related political activity as voter
education activity and, if so, a description of how the proposed exception will
both ensure that excepted activities are conducted in a non-partisan and
unbiased manner and avoid a fact-intensive analysis.

Carolyn Lee

LWV Sudbury MA board member