IRS chief: New tax-exempt rules could include unions, Chamber

John Koskinen, the IRS commissioner, suggested in a new interview that rules guiding tax-exempt organizations could be widened to include labor unions and trade groups.

ADVERTISEMENT
Koskinen, speaking to the Center for Public Integrity, also said the new regulations would place specific limits on political involvement by 501(c)(4) groups.

“There are three issues: What should be the definition, to whom should it apply and how much … can you do before you jeopardize your exemption?” Koskinen said in the interview. “The next resolution will differ from the first draft because it will deal with all three questions.”

The new regulations aren’t expected until next year. The IRS announced last month that it was taking another crack at regulations governing the 501(c)(4) groups at the heart of the agency’s targeting controversy, after receiving tens of thousands of negative comments.

The original regulations, rolled out last November, asked for comments on whether the rules for 501(c)(4) groups should be expanded to organizations with other tax exemptions, like labor groups and the U.S. Chamber of Commerce.

Chamber officials sharply criticized the original proposal for 501(c)(4)s, calling them a “stalking horse for chilling political speech.”

The first set of rules also tried to define what constituted political activity for so-called social welfare groups, but did not weigh in on how much politics those groups could engage in.