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IRS Chief Calls for a Redo on Proposed Anti-Free Speech Tax-Exempt Rules

To retreat or reload?

The IRS appears to be backing down – for now – from its ill-conceived, and blatantly unconstitutional, attempt to restrict the free speech rights of conservative and pro-life Americans.

In the wake of the IRS targeting scandal, the IRS proposed new rules, feigning that the fog and confusion of complex rules resulted in the inappropriate targeting and that new rules were needed to prevent this from happening again.  The reality was that the newly proposed changes to longstanding IRS rules were being orchestrated at the same time, and involving some of the same people, i.e. Lois Lerner, as the IRS targeting scandal itself.

Now, as USA Today reports, the IRS is backpedaling from its newly proposed rule after receiving a deluge of comments decrying the abusive regulations:

The Internal Revenue Service is prepared to rewrite a proposed rule regulating the political activities of non-profit groups to address complaints from the right and left that it goes too far, IRS Commissioner John Koskinen said Monday.

“In all likelihood we will re-propose a redefined rule and ask for more public comment,” Koskinen told USA TODAY’s Capital Download. It’s a process he predicts will take “until the end of the year and beyond” to complete. The proposed regulation of groups known as 501(c)(4)s drew a record 150,000 comments before the deadline in late February. . . .

“I think we have to take all of that into consideration,” Koskinen told the weekly video newsmaker series. “There are very thoughtful comments and concerns, and one of the questions that has evoked a lot of comment is, once you define what political activity is, to what organizations should it apply in the 501(c) context and how much of it should be allowed? All of that is going to be very important.”

The ACLJ filed official comments earlier this year on behalf of 41 targeted conservative groups and thousands of Americans, explaining in detail how these anti-free speech rules violated the Constitution.  And we weren’t the only ones.  The ACLU and a whole host of left-leaning groups vigorously opposed these rules as dangerous impositions on Americans’ free speech rights.

The reality is these proposed IRS rule changes represented IRS targeting 2.0, essentially codifying the behavior that led to the unlawful targeting itself.  The proposed rules were a veiled attempt to achieve the same result as the IRS targeting, or worse, by silencing conservatives who have merely chosen to exercise their free speech and free association rights.

As I explained before:

As it stands now, 501(c)(4) organizations, or social welfare groups, are allowed to operate tax free, as long as their primary purpose is to advance social welfare and is not political (to the IRS anything remotely political cannot possibly promote social welfare).  Thus, as long as less than 50% of what you do falls under the “political” heading as defined by the IRS, you are compliant with the law.

The newly proposed IRS rules would drastically change the definition of “political.”  In fact, the change is so drastic that the definition itself constantly changes what is and isn’t “political” – and thus somehow no longer promoting “social welfare” – throughout the course of the year.

It’s a fantastic victory for free speech that the IRS is pulling back on this disastrous regulation and shows how when hundreds of thousands of Americans take a stand in defense of liberty, it can have a significant impact.  Free speech is safer today, because the American people spoke out.

But don’t be fooled.  The IRS has not given up on its leftist-inspired mission to, as newly appointed IRS Commissioner Koskinen admits, “define what political activity is.”

That’s the scariest part of this rule.  IRS tax lawyers with no background in First Amendment law or campaign finance law, following the beck-and-call of the Obama Administration and its liberal allies, will attempt to redefine what political activity is.  Political speech has long been held as the epitome of free speech under our Constitution, and now the IRS – the tax revenue collecting agency – is being tasked with redefining it.

The Obama Administration may think it can have a take two on IRS targeting 2.0, but at the ACLJ we’re going to be ever-vigilant in defending free speech against any such attempts.

 

Matthew Clark is Associate Counsel for Government Affairs and Media Advocacy with the ACLJ. A lifelong citizen of the Commonwealth of Virginia, he lives with his wife and three boys in Northern Virginia. Follow Matthew Clark: @_MatthewClark.

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