Focus on Congress

Current & Quotable Editor's Notebook Focus on Congress

EO Tax Journal 2010-145

Paul StreckfusComments Off on EO Tax Journal 2010-145

1 – More 501(c)(4) Developments

2 – Information on Recent Tax Court Litigation
_____________________

1 – More 501(c)(4) Developments

For earlier developments, see EO Tax Journal Updates 2010-116, 120, 128, 129, 133, 134, 135, 136, 139, 141, 142, and 143. As I noted in Email Update 2010-128 (9/13/10), “Opening an audit involving the U.S. Chamber of Commerce will bring a firestorm of criticism from Republicans who will charge White House complicity. Clearly a no-win situation for Commissioner Shulman whose budget may be in Republican hands next year.”

Editor's Notebook Focus on Congress

EO Tax Journal 2010-141

Paul StreckfusComments Off on EO Tax Journal 2010-141

The Congressional Research Service released a report titled “Tax-Exempt Organizations: Political Activity Restrictions and Disclosure Requirements,” which I’ve reprinted below. For those closely following these developments, there is nothing new. For folks who wish to be brought up to date, this report is a good synopsis of where we stand today.

Speaking of political activity, this morning I went to the ongoing NAAG/NASCO Conference to hear Lois Lerner and Ruth Madrigal speak. Not to my surprise, Lois and Ruth rehashed their recent ABA comments in Toronto, and I’ll have a transcript of those comments shortly. What did surprise me was Lois’ answer to this question by an attendee: “What about churches and preaching from the pulpit?” Lois emphatically answered: “I’m not going to talk about that.”

Normally I’d expect Lois to give the usual IRS gobbledygook answer, such as “We’re looking into that, but of course I can’t say anything about any particular church.” So what’s the difference in her saying, “I’m not going to talk about that.” Well, I’m not blaming Lois, since I’m sure she is merely reflecting the IRS’ say-nothing position, but the IRS should be talking about churches and politicking from the pulpit.

The Alliance Defense Fund is encouraging pulpit politicking. See Email Update 2010-137. I don’t see how the IRS can walk away from this challenge. Yet all we’ve heard from the IRS is, “I’m not going to talk about that.” Last week, Marc Owens may have said what Lois cannot say (see Email Update 2010-139). According to Marc, the IRS has “effectively abandoned the field” at a time of heightened political activity by all exempt organizations, including (c)(3)s. He added: “We seem to have a haphazard IRS enforcement system now breaking down completely.” Marc of course formerly held Lois’ job, so I don’t see how the IRS cannot respond to his comments, unless what he is saying is true, in which case there is no good response possible.

On a more cheery note, Ruth Madrigal’s predecessor, Emily Lam, has rejoined Skadden, Arps, Slate, Meagher & Flom LLP as Counsel in the Washington, D.C. office. Emily’s practice will focus on tax controversy and exempt organizations matters.

Focus on Congress

EO Tax Journal 2010-89

Paul StreckfusComments Off on EO Tax Journal 2010-89

1 – Old Business

In regard to yesterday’s email update that included a proposed revenue ruling on the treatment of the discharge of indebtedness under the UBTI rules, CPA Sarah Harlan of Lake Oswego, Oregon, is of the opinion that unrelated business income is not an issue. According to Sarah, years ago she asked the IRS’ Dave Jones about how to treat discharge of indebtedness. Dave checked with his colleagues in Income Tax whose responsibilities included section 170, and they were of the opinion that the IRS would treat forgiveness of debt to a tax-exempt entity as a donation by any individual or corporate creditor. Hence, under this tax treatment, there would be no unrelated business income issues. Other comments?

Editor's Notebook Focus on Congress

EO Tax Journal 2010-70

Paul StreckfusComments Off on EO Tax Journal 2010-70

ACT Committee

The IRS announced yesterday (IR-2010-61) the selection of two new EO members of the Advisory Committee on Tax Exempt and Government Entities (ACT): Karen A. Gries of LarsonAllen LLP, Minneapolis, Minnesota, and Celia Roady of Morgan Lewis & Bockius, LLP, Washington, D.C.

Focus on Congress Focus on IRS and Treasury

EO Tax Journal 2010-63

Paul StreckfusComments Off on EO Tax Journal 2010-63

1 – IRS Auditing $1.2 Million Salary Paid to Fired University President

I’m guessing the audit of the Kansas City University of Medicine and Biosciences (see article below) is part of the exams generated by the IRS’ college and university initiative. If so, the school joins Harvard University, Lamar University, Suffolk University (Boston), Texas A&M University, and the University of Texas on my list of identified school audits.

2 – Senator Grassley Comments on CBO Report on Collegiate Arbitrage

Are colleges and universities double-dipping when it comes to tax breaks?
_______________________

Editor's Notebook Focus on Congress

EO Tax Journal 2010-59

Paul StreckfusComments Off on EO Tax Journal 2010-59

Since Friday’s email update, my mailbox has been overflowing with queries about Nan Downing — who she is, and what EO tax practitioners can expect from the IRS’ new top cop.

I hope to have a transcript of Nan’s remarks on last Thursday in the near future. Unfortunately, Nan speaks softly (but carries a big stick?) and the acoustics weren’t good, so we’ll see if my transcriber can overcome these obstacles.

Focus on Congress Focus on IRS and Treasury PLRs, TAMs, and Denial Letters

EO Tax Journal 2010-46

Paul StreckfusComments Off on EO Tax Journal 2010-46

A bit of this and that today. I expect to have a transcript of an interesting governance discussion that occurred last week featuring Fred Goldberg, Lois Lerner, and Suzanne McDowell if — and this is a big if — my transcriber — a big fan of Kentucky — can recover from Kentucky’s loss to West Virginia in the NCAA Men’s Basketball Tournament.

1 – Ten Tips for Deducting Charitable Contributions

2 – Six Important Facts about Tax-Exempt Organizations

3 – Grassley on New Hospital Provisions

4 – Providing Administrative Services Will Not Constitute Unrelated Trade or Business (PLR 201012052)

5 – Transfer of LLC Units to PF Will Not Constitute Self-Dealing or Recognition of Gain to Donors (PLR 201012050)

Focus on Congress Focus on IRS and Treasury PLRs, TAMs, and Denial Letters

EO Tax Journal 2010-40

Paul StreckfusComments Off on EO Tax Journal 2010-40

My bookshelf

I kind of skimmed Sarah Palin’s book, Going Rogue, so I shouldn’t comment on what I didn’t really read. From another source, I learned that Palin has ancestors from County Roscommon in Ireland. Well, my mother’s family goes back to County Roscommon, too. Who knows, I may be a distant cousin. If Palin becomes President, someone remind her of that. I’d like to be an ambassador, preferably to a country where the living is good and the toasts never end.

Focus on Congress Focus on IRS and Treasury

EO Tax Journal 2010-16

Paul StreckfusComments Off on EO Tax Journal 2010-16

1 – EO Revenue Procedures Updated

The annual updating of the basic EO revenue procedures has taken place with few changes.

Rev. Proc. 2010-4, on TE/GE letter ruling requests, has mostly minor revisions. An additional circumstance under which EO Technical will not issue letter rulings is added as section 6.18.