As it always does, tax day has arrived. And though thanks to an awesome DC holiday, we’ve got a reprieve until Monday, we were too excited to wait to announce that the brand-new Bright Lines Project (BLP) blog! Welcome!
What can you expect to find here? Nonprofit news, updates on the BLP’s plan for better nonprofit rules, insightful interviews, and something fun once in a while from the BLP team. I hope you join us every week!
This week, the Bright Lines Project Drafting Committee released a statement on the harmful effect of a rider that delayed the IRS and Treasury’s rulemaking on nonprofit political activity. These rules could have helped nonprofits further their missions in an election year without worrying about risking their nonprofit status.
We argue in this paper that delaying the rulemaking:
Chills Civic Participation by 501(c)(3)s, such as Charities and Churches
Charities rely on having a predictable definition of political activity so they can fulfill their missions without running afoul of the law when they enter the realm of public policy. However, when the definition is vague, they often shy away from action they could legally take because they do not want to risk their tax-exempt status.
Dismantles IRS Enforcement
A workable definition is required to ensure that organizations operating in good faith can comply with the law and that the IRS can enforce the law against those that operate in bad faith.
Harms our Democracy
A handful of large nonprofit campaign-related entities — 501(c)(4) nonprofits and 501(c)(6) trade associations — are on track to spend a record amount of money in this year’s presidential elections, on activities that common sense would deem to be political. The effect of the vague rules amounts to a declaration that the IRS will not regulate their political spending, clearing the way for even more undisclosed money to pour into our elections.
Silences the Public’s Voice
The most troubling aspect of the congressional rider delaying this rulemaking is that it removes the public’s voice from a topic they really do care about. Polling from the summer of 2014 shows that voters of all party persuasions believe that clear rules are important for nonprofits, and the public submitted more than 170,000 comments on the original NPRM further proving this point. But rather than allow the public to continue to give their input, the rider locks up the decision making process within the IRS building, perpetuating a system to determine political activity that everyone knows isn’t working.
You can read the full document here.
Nonprofits are trusted experts in their fields at a time when faith in institutions is waning. We should be making it easier for them to educate the public, not forcing them to wait for better rules so they can know when and how to engage.