As the 2014 Congressional elections loom over DC, the IRS has proposed new rules which would muzzle hundreds of grassroots groups. In a controversial move, the Internal Revenue Service will redefine certain criteria for what defines a 501(c)(4) tax-exempt activity in order to eliminate their place in the public square, and in the words of House Ways and Means Chairman Dave Camp (R., Mich.), “[put] tea party groups out of business.”
According to the IRS’s own website, groups “qualify for exemption under section 501(c)(4), [if] the organization's net earnings [are] devoted primarily to charitable, educational, or recreational purposes.” This allows a myriad of citizen groups to educate their communities about issues which would affect them. Because of these activities, citizens can research laws and disseminate the information for free to those who might be impacted by the policies.
But with the proposed changes, organizations would lose their tax exempt status if they continued to spend sizable parts of their budget on the most basic civic activities. Among these activities are:
- Voter registration drives and “get-out-the-vote” drives.
- Distribution of any material prepared by, or on behalf of, a candidate or, by a section 527 political organization (PAC).
- Preparation or distribution of voter guides that refer to candidates (or, in a general election, to political parties).
- Holding any event within 60 days of a general election (or within 30 days of a primary election) at which any candidate appears as part of the program.
Under these criteria, any effort to educate the public about candidates, or the laws being passed by legislatures would be construed as “political activity” and will be used to suppress the free speech of social welfare groups. Candidate debates, although they are useful to the general public, would be shut down in a Machiavellian attempt to prevent ideologically inconvenient groups from threatening the government’s agenda.
However, though the rule changes do not specifically mention conservative groups, right leaning groups will be affected disproportionately because they are organized under the affected section of the tax code, 501(c)(4). 501(c)(5) groups, what unions file under, will see no change in their status and will be allowed to continue in their blatant political activism. In a press release, House Oversight and Government Reform Committee Chairman Darrell Issa (R-Calif.) had this to say about the situation:
“The fact that the Administration’s new effort only applies to social welfare organizations — and not powerful unions or business groups — underscores that this is a crass political effort by the Administration to get what political advantage they can, when they can.”
February 27th is the last day for public comment on the changes, and after that, there is nothing stopping the IRS from adopting these unfair rule changes that will suppress the main activities of thousands of activist groups.-