By Luana Wang
If you’ve been following the IRS rulemaking on 501(c)(4) social welfare nonprofit political activity (and really, who hasn’t?), then you know that IRS Commissioner John Koskinen’s latest testimony in front of the Senate Finance Committee was one for the ages. Ranked among his previous thirty-something testimonies in front of legislative bodies, it rates somewhere above the time Commissioner Koskinen had to explain that the IRS actually does read the tax returns you send in.
Two years ago, the IRS announced a notice of proposed rulemaking which would clarify the rules on political activity for social welfare organizations under section 501(c)(4) of the tax code. Although the proposed rule was a step forward from the confusing “facts and circumstances” standard currently being used, the IRS withdrew the proposed rule for further revision after it received much criticism from both sides of the aisle.
This time, Commissioner Koskinen’s testimony contained hope for a new rulemaking, and a peek into the IRS’s evaluation of the more than 160,000 comments that the previous rulemaking received. Before we examine that evaluation, let’s also take a quick moment to recognize the comments that didn’t make it into the IRS Commissioner’s summary, and the beleaguered IRS officials who had to read each and every one of them anyway. Many of the comments submitted to the IRS were thoughtful, sincere, and legitimate criticisms of the proposed rule, from commenters across the political spectrum. However, some comments seemed to have little to do with the proposed rule, or really, anything at all.
Here are some highlights:
- “Your blocking our 2nd amendment.” On a first reading, the proposed rule interpreting the limitations on political activity for social welfare nonprofits under section 501(c)(4) of the tax code would seem to have little to do with the Second Amendment to the Constitution. This is true of the second and third readings as well, though further readings may yield something significant.
- “I love all the Admendments!!!” In addition to the Second Amendment, notable amendments to the Constitution also include the Sixteenth Amendment, which establishes the authority to collect a federal income tax.
- “IN THE END GOD WILL WIN.” ?????