Richard Spencer's White Nationalist Nonprofit Loses Tax-Exempt Status - For Failing to File Required Annual Returns

The L.A. Times reports that the IRS has revoked the tax-exempt status of the National Policy Institute, a white nationalist group headed by Richard Spencer, effective as of May 15, 2016. The revocation was not because of either a failure to satisfy the methodology test applied to "educational" organizations under Revenue Procedure 86-43 or for alleged political campaign intervention during the 2016 election. Instead, it was for failing to file the last three IRS annual information returns due from the organization, a failing that Spencer blamed on an IRS misclassification that led to the public listing for the group indicating it was not required to file such returns. Assuming that the Institute challenges this revocation, it will be interesting to see how the IRS responds to this argument.

Lloyd Mayer