Wednesday, May 15, 2013

The Children of the Tea Party and the IRS

I find myself a bit conflicted over the latest scandal over the IRS scrutiny into "Tea Party" 501(c)(4) organizations and their exempt status.  I understand the highly political and sensitive nature of the issue, and the IRS certainly lacked the simple foresight to understand their exposure, but to say the issue is overblown is an understatement.

As the "Tea Party" and related ultra-conservative organizations spawn, the workload on the IRS to process applications increased.  Rather than boost personnel, the IRS developed a strategy to categorize applications and apply increased scrutiny.  I'm sure the strategy made sense on an organizational level, but it now seems a bit politically tone deaf.

My fear is that the consequences of this scandal will mean the IRS steps back from their watchdog and policy generation role in the nonprofit sector.  The IRS is a vital partner in ensuring the the cooperative system between nonprofits and the public is healthy, reliable, and well-regarded by the citizenry.  Pulling back on oversight presents the risk of fraud, abuse, and distrust.  New organizations will feel free to primarily engage in political activities because the IRS is shy about challenging these organizations.

The IRS needs to find a healthy way to address this issue and develop an efficient oversight system.  They play a crucial role and organizations, whether they are aware of it or not, need reliable oversight and guidance to be successful.

For more information: http://www.huffingtonpost.com/the-center-for-public-integrity/irs-nonprofit-division-ov_b_3272234.html

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