Readers’ Corner: What’s All the Fuss About the New IRS Rules?

February 18, 2014

IRSA reader asks: Why doesn’t ANH-USA just change its tax status in order to preserve its right to speak out? Action Alert!

Since we first broached the subject of the IRS’s new rules concerning 501(c)4 nonprofits like ANH-USA, many of our readers have offered comments and suggestions. One recently asked why we don’t change our organizational form:

Clearly some of ANH’s activity is political, so just like my local non-profit, they should have to form a separate non-profit for the political activity, which is not tax exempt. It is reasonable and just [to ask this], so why the whining and claiming persecution?

We thought we would share our response to this reader:

We are guessing, based on your remarks, that the local nonprofit you refer to is a 501(c)3 organization under the IRS code and that it set up a 501(c)4 organization, because a (c)4 is allowed to engage in more political activity. A (c)4 organization is a nonprofit and thus is called tax-exempt, but gifts to it are not tax deductible as they would be for a (c)3.

Please note that ANH-USA is already a (c)4, not a (c)3. So we have previously done what you suggest we should do now. Unless you suggest we become a for-profit (which would violate our mission and still keep us under IRS supervision), our only viable option is remain a (c)4.

Meanwhile we do not think that the IRS should be telling a (c)4, which by law is allowed to engage in political activity, that it cannot even mention the name of a legislator even if he or she has just filed a new bill. Nor should the IRS put in gag rules about what a (c)4 can say about regulators or regulatory agencies. US law has specifically exempted discussion of regulation and regulatory actions or appointments from political lobbying law. There is a good reason for that. Regulation is supposed to be done outside the context of partisan politics. Making the IRS into a political speech cop and interfering with free speech about regulation are really bad ideas and also violate our constitutional rights.

For more on our coverage of the proposed IRS rules, please see this article and, most recently, this article. And if you have not already done so, please see our Action Alert—the deadline for all comments is February 27!

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11 responses to “Readers’ Corner: What’s All the Fuss About the New IRS Rules?”

  1. S. Cleveland says:

    I stand with you.
    Thank you for your tireless effort in working to give the facts, and dig out the truth on many such matters. Myself and, I know, others, are listening to what you say, and it does matter to us, and it also does make a difference!
    I for one, appreciate the learning, which is always well-founded and supported by dedicated research and truth.
    Please continue. Your work is very important if we are ever to maintain, the freedoms that we still have, and an environment in this world, where our children and grandchildren can live safely and healthily!

  2. Maggie says:

    Well said, ANH! Your reply actually clarified some of my own confusion on this issue. Curtailing free speech of active citizens, while allowing the “speech” of corporate millions to infect our political system, is the ultimate injustice!

  3. Patricia Greenough says:

    Hello All at ANH,
    Thanks for the this information and clarification about non profits and politics.
    I was wondering about these things when I wrote a long comment into the record
    a day or so ago on the IRS site (triggered by signing your action alert).
    Kindest Regards,
    Patricia

  4. Howard Beatty says:

    The real solution to the problem is to restore the system of Juries – the Grand Jury and the Trial Jury – which date back to, at least, Magna Carta, and which our Founders and Framers instituted in our political and judicial system. True and independent Juries of the People, fully informed of their rights and responsibilities, could put an end to this type of government usurpation and oppression.

  5. Carolyn Peterson says:

    You are right on and I support you in all the ways that I can.
    However, whatever shall we do when the almighty dollar is devalued by the entire globe? And however will “they” be able to collect anything anytime after that occurance.
    Time to start bartering, ha.

  6. william haegele says:

    so the republicants have attacked through the irs. surprise!
    look ma, no caps.

  7. Lionel Ortiz says:

    Regarding IRS and 501 (c)(4),
    Any group that uses 501(c)(4) for political gain pushing issues that are not in the interest of the commons is breaking the rules as I understand them.
    What your group is doing is working for the common good.
    In my mind, there is a huge difference between extreme right wing groups pushing for their own corporatist gains and a group trying to watch out for the masses.
    Ergo the IRS stepping in, right or wrong. I believe rightly. Their has to be oversight over out of control groups.

    • one must remember that these rules are being changed under the watchful eye of a democratically controlled Senate and presidency…and we can blame either side…this isn’t about one side or the other…the question is why are we moving away from our basic constitutional rights and privileges…why now…and it bothers the h out of me that we are slowly loosing our rights to express our opinions…and what is about government as a whole that is allowing this to happen…seems simple enough…to blame big business for all of this and create an impression that the other side doesn’t have a role in this is patently wrong…

  8. Larry Jordan says:

    Freedom of speech must not be short circuited. An i formed citizenry is essential in a democracy and in a representative form of government like ours. A gag order to suppress free speech is outrageous and must be rejected. The first amendment is not negotiable.

  9. Kathi says:

    Now I will be the first to admit I am not familiar enough with this situation to lend a reasonable argument, but I am familiar enough with the ways and means of the federal government to make a comment here.
    ANH-USA is only asking to be allowed to speak about matters that which is already granted to them by the US Constitution. The problem though with that, most governmental agencies always seem to stick their nose in and try to create “troubles” when the subject at hand does not flow along the lines of current policy or “departmental thinking”.
    While this flow of information may be contrary to what the federal government wishes us constituents to believe, this is still the democratic process. ANH-USA and any other organization is fully within their rights to expound on their thoughts and beliefs also without having to be subjected to pressure from any kind of governmental agency. To ask an organization to change their tax status to preserve their right to speak out about something which they already have permission to do by the Constitution is not only foolhardy, it is one more method of strong-arm tactics we are allowing the government to get away with.
    No one likes a bully! Why should we, the citizens, allow our government to get away with it also just because one of their constituents is fully within their rights to speak up about a situation which they believe it needs to be brought to everyone’s attention.

  10. Tina B. says:

    I think the bigger question is, why is the IRS even attempting to impose regulations on any one person or group that is outside of taxation regulation and compliance, which to my understanding is the IRS’s role in government???
    I can understand setting limits on the “types” of donations made or received by non-profits, and, the explanation of the specific types and their appropriate taxation or non-taxation designation. But, I do not understand where the IRS gets it “authority” to designate and compel a non-profit, a regulatory agency, or individual to omit a specific persons name regarding a piece of legislation that is available TO THE PUBLIC regardless of its introduction/support by a particular political party.
    This sounds like a bit too much Big Brother for me, watching and telling people what to think and do.

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