IRS drops screening requirements for many charities, Time reports
07/14/2014 5:53 AM
07/15/2014 6:16 AM
The Internal Revenue Service won’t carefully screen four of every five organizations seeking tax-exempt charitable status every year -- a change that could mean less scrutiny of questionable use of the tax code by political groups, according to a new report in Time Magazine.
It reported that starting this month, any organization will “automatically be allowed to accept donations that are tax-deductible for the donors" if it: pays a $400 fee; says in its online form that its annual income is less than $50,000; has assets worth less than $250,000; and is in compliance with a charity’s tax requirements.
Internal Revenue Service Commissioner John Koskinen told Time the changes would mean “a faster and better review” of bigger nonprofits and help reduce a huge backlog of groups waiting years to begin a charity. He said that on the new short form, “people certify that they’ve gone through the instructions” under penalty of perjury. In the past, applicants had to fill out a lengthy form and submit detailed documentation.
The IRS has been under fire for targeting of some conservative groups for special scrutiny.
The (c)(4) groups could participate in political activity if they spent more than half their funds for that purpose. The 2010 Citizens United Supreme Court ruling expanded their reach, so they could buy ads while not revealing donors. Groups seeking special tax status increased, and Time reported that in the 2012 campaign, (c)(4)s spent about $300 million dollars on political activity, according to the Center for Responsive Politics.
“Much of that money was spent attempting to motivate voters by advertising positions on specific issues that divide candidates,” Time said.