Thursday, August 17, 2017

Hate Groups & Tax Benefits

Img_1578Both Terri Helge and Joseph Mead previously reported in this space on the tax benefits that many organizations often identified as "hate groups" enjoy because of the broad and vague requirements for qualifying as an educational organization under Internal Revenue Code sections 501(c)(3) and 170(c)(2). Not surprisingly, the events in Charlottesville have led to a renewed discussion of this topic. Recent coverage includes a Business Insider story on this topic and a fascinating blog post by Sam Brunson (Loyola Chicago) on the conflict almost a hundred years ago between the IRS and the KKK (and from which the photo shown here is borrowed).

Lloyd Mayer

http://lawprofessors.typepad.com/nonprofit/2017/08/hate-groups-tax-benefits.html

Federal – Executive, In the News | Permalink

Comments

Similarly, query whether the counterprotesters, who engage in patently illegal conduct, should have their exemptions pulled. I suspect that they get grants from larger DAFs and fiscal sponsors, so the fall out is potentially larger.

Posted by: john | Aug 17, 2017 1:12:15 PM

You raise an interesting point that like whether a "hate group" can be tax-exempt is actually quite complicated, since this is tax law. For one, some of the groups involved were not tax-exempt - according to news reports two groups called for the counter-protests and based on a GuideStar.org search one of them (Together Cville) is not tax exempt. For another, any illegal activity would only be attributed to a tax-exempt nonprofit involved if they were somehow responsible for that activity, as the IRS had detailed in its publications on this topic (see, for example, https://www.irs.gov/pub/irs-tege/eotopicl94.pdf).

Posted by: Lloyd Mayer | Aug 18, 2017 7:02:27 AM

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