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If you are the kind of geek who likes to hang out at, where the Federal government posts proposed rules and regulations, you know that the items posted there are usually pretty specific and technical, the kinds of issues that maybe dozens or hundreds or occasionally a few thousand lawyers, accountants, and advocates will post thoughtful comments about, either in favor of or in opposition to, but most often suggesting some tweaks to the government proposal. These things DO NOT go viral.

But in late November, the IRS issued "Guidance for Tax-Exempt Social Welfare Organizations on Candidate-Related Political Activities," proposed regulations for 501(c)(4) social welfare organizations regarding their political activities. As of this morning, the last day of the comment period, this post has received 112,497 comments, a record number in the history of the United States by a mile.

A few of these comments, if you take the time to ferret them out, are the thoughtful types one usually sees at this site. Most of them, however, are of the "go to this site and paste our ready-made comments" ilk which have been spurred by various organizations at both ends of political spectrum, though mostly on the right. These comments mostly miss the point, which is a pity, because although the proposed regulations do have some flaws, clarifying regulations are long overdue. In my opinion, you can find the most thorough treatment of the issues and most sensible proposed remedies at the Bright Lines Project.

The real genesis of most of these 112,497 comments is the revelation last summer that the IRS had been using some dodgy techniques to try to identify 501(c)(4) organizations that were likely to be overly political. You can hate the techniques, but they were trying to do what the law requires of them. This is what the law says: "the promotion of social welfare does not include direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office."

However, some political activity is allowable by 501(c)(4) organizations as long as their primary work is for the social welfare. This is by no means a new problem that has cropped up because of the so-called IRS scandal. The regulations governing both what is allowable political activity and how much of it a 501(c)(4) organization can engage in have been murky from the start, using a "facts and circumstances" test that ultimately ends up being subjective whether intended to or not. The IRS proposed these new rules not to stifle free speech or discriminate against tea party organizations, but to try to put the original purpose of social welfare organizations back on track.

It will be interesting indeed to see whether they take some of the common sense suggestions being proposed and finally come up with regulations that are clear and fair, or bow to the enormous political pressure being directed their way and just drop the whole matter.

Chuck McLean Chuck McLean

The preceding is by Chuck McLean, GuideStar's vice president of research. Chuck is responsible for conducting research for GuideStar and customers interested in nonprofit sector data. He also works to identify new data sources and ways to present data effectively to GuideStar users. Chuck produces the annual GuideStar Nonprofit Compensation Report, which analyzes the salary and benefits of thousands of nonprofits throughout the country. He has 15 years of experience as a teacher and researcher in various institutions of higher education. Chuck serves on the advisory committee of the National Center for Charitable Statistics and is a member of the Panel of Nonprofit Sector Representatives for the Commission on Accountability and Policy for Religious Organizations. A graduate of Christopher Newport University, Chuck also received an M.S. degree in mathematics from the College of William and Mary.

Topics: Legal Policy