EO Tax Journal

1 – The Never-Ending Dilemma

2 – PwC Responds to IRS Request for Form 990 Comments Continue…

The sad state of Treasury/IRS guidance is on full display today. First is a report on an organization called Americans Elect that claims to be a section 501(c)(4) section but appears to be a burgeoning political party. With the IRS unable or unwilling to address political activity by (c)(4)s, must we concede that this organization is being “operated exclusively for the promotion of social welfare”? The second is a letter expressing concern about “the continuing failure of the Treasury Department and the Internal Revenue Service to promulgate legally-defensible audit procedures for examining churches and organizations claiming to be churches.”

Next week I’ll summarize all the “solutions” I’ve received to the lack of guidance problem discussed the last two days. Until then, I’m left to continue to wonder why the relatively simple section 7611 regulations — proposed in 2009 — have not been finalized.

1 – Can a Political Party Be a (c)(4)?

2 – Missing In Action – Section 7611 Regulations

3 – How Much is Too Much? Continue…

Gerry Griffith represented healthcare tax lawyers at this week’s forum on community health needs assessments hosted by the Centers for Disease Control and Prevention and the Public Health Institute in Atlanta. Thanks to Gerry’s help, I have his prepared remarks as well as his accompanying slides.

Section 501(r) of the Code was enacted as part of last year’s Affordable Care Act, and imposes additional requirements on tax-exempt hospitals, including conducting periodically a community health needs assessment, called CHNA for short. While section 501(r) applies to hospitals, its impact may eventually be sector-wide. That’s because in section 501(r) Congress wants hospitals to show that they deserve continued tax-exempt status. The same could be asked of other section 501(c)(3) organizations. Congress may seek to demand that colleges and universities show why they deserve continued tax-exempt status. Similarly for charities classified under section 509(a)(2), which some critics say are mostly quasi-businesses dressed up as charities. In addition, some argue that section 509(a)(1) charities that only receive 10% (or slightly more) of their support from the public are private foundations dressed up as charities. So section 501(r) could be a bellwether of where Congress is going vis-a-vis charities. Continue…

My favorite headline from yesterday’s Baltimore Sun: “Maryland Woman Sentenced to 30 Days in Prison for Trying to Run Boyfriend Over with Car.” What would she have gotten if she had succeeded? 45 Days?

I welcome all points of view, so today I’m happy to let former IRSer Bill Brockner make the case for what I call libertarianism in the EO sector. Bill joined the EO Division in 1972 and stayed until sometime in the aughts, over 30 years, maintaining his passion for EO tax law the whole time while becoming one of the IRS’s top EO technical experts.

Commentary by Bill Brockner Continue…

1 – EO Litigation Developments

2 – ADF Report on Pulpit Sunday Efforts

3 – Amicus Brief Filed in Catholic Answers Case Continue…