EO Tax Journal

A little bit of this and that today

1 – The EOTJ Mailbag

3 – Bidding Farewell Continue…

1 – The EOTJ Mailbag

Milt Cerny (mcerny@mcguirewoods.com) had this to say about Wednesday’s reporting that the Council on Foundations-convened Treasury Guidelines Working Group had decided to end its dialogue with Treasury over the Anti-Terrorist Financing Guidelines for U.S.-based charities.

“Paul, I read with regret the headline that ‘Charities End Dialogue with Treasury over Guidelines that Stifle Effective Global Grantmaking.’ I have followed the efforts of U.S. charities as they provided relief efforts, assisted foreign educational and cultural programs throughout the world, and helped reconstruct democratic civil societies in countries that were subjugated to totalitarian rule. The U.S. was and is the model for philanthropic and voluntary efforts. The world is changing, and while there has been limited abuse of charities for political ends, it does not justify the burdensome and overbroad restrictions that have been placed on charitable international grantmaking through so-called Treasury voluntary guidelines without appropriate rule-making notice for public comment and government reflection. However, I think the charitable community must continue the dialogue with Treasury until reasonable rules can be put in place to protect vital national interests and promote international philanthropy to create a viable civil society.”

My take: The situation for Treasury is a tough one. If they back off their guidelines and a terrorist organization gets money from a charity, they will be harshly criticized. So if I’m Chip Poncy (is that his real name?), the answer is simple — I ignore the complaints of the charitable sector now rather than risk getting dumped on later. This may not be the right answer, but in a highly charged political environment, it may be the only logical response.

2 – Weekend Reading

Crossing the Border: A Comparative View of Philanthropy

What follows are the September 24 remarks of Philip T. Hackney, Senior Technical Reviewer, Exempt Organizations Branch 2, Office of Chief Counsel, IRS, Washington, DC, Robert B. Hayhoe, Miller Thomson, Toronto, ON, Susan Mott, Operational Policy & Appeals Liaison, Policy Planning & Legislation, Charities Directorate, Canada Revenue Agency, Ottawa, ON, and Mark B. Weinberg, Weinberg & Jacobs LLP, Rockville, MD, as delivered to members of the EO Committee of the ABA’s Tax Section. The moderators of the panel are M. Elena Hoffstein, Fasken Martineau LLP, Toronto, ON, and LaVerne Woods, Davis Wright Tremaine LLP, Seattle, WA. Continue…

1 – Working Group Rips Treasury for Unproductive Discussions and Chilling Vital Charitable Activity

2 – Yes, Virginia, There Is a Section 501(d) Continue…

Last week I sent out the EO Subject Matter Directory (Email Update 2010-174) and, before that, the EO Division roster (Email Update 2010-171). In response, I got this missive from an IRS employee:

“Don’t cite my name (just call me T), but your information is outdated. Several of the individuals listed are managers and do not answer questions and others no longer work in EO.”

My response: The roster information is based on a listing of EO Division personnel dated September 7, 2010, sent to me by the IRS in response to a FOIA request. If managers do not answer questions, this is a new development. Unfortunately, my efforts this year to get information from Rob Choi about how the IRS handles practitioner phone calls has been met with overwhelming silence. As far as I can tell, there is no policy. Some folks return phone calls, some don’t. I say call and hope for the best.

Today I’m sending out phone numbers of EO field personnel. Here I’ll agree with T that some percentage of the information is outdated. Getting information out of the IRS about personnel in Determinations and Examinations is very difficult. My choice is to publish nothing or publish what I have. Here I believe something is better than nothing, but don’t expect 100% accuracy — maybe 80% accuracy is what I have. Continue…

Even though the IRS won’t confirm whether or how it will respond to phone calls, the EO Subject Matter Directory is a valuable resource, but those of us who have worked at the IRS know that some practitioners abuse the opportunities presented. Here are six rules of the road that everyone should abide by. Observing these rules might make the IRS folks more willing to return phone calls:

One, don’t call if you haven’t done your homework. It is not the IRS’ job to explain the basic intricacies of a Code section and the accompanying regulations.

Two, don’t expect to get definitive answers. If you’re lucky, someone at the IRS will make suggestions as to how you might proceed or warn you off certain approaches.

Three, do not later tell revenue agents someone at the IRS National Office has approved a course of conduct or a transaction during a telephone call. If you need a ruling, spend the $10,000.

Four, do not shop around among tax law specialists for a better opinion. The folks at the IRS usually become aware of someone going down their phone list.

Five, limit your phone calls. Calling more than once a month is probably too much.

Six, don’t push your weight around if you are a big shot as this often backfires either immediately or in the long run. Continue…