IRS Releases Streamlined Reinstatement Procedures for Auto-Revocations

The exempt organization community received welcome news today from the IRS, signaling what hopefully will be the start to a good year! Revenue Procedure 2014-11 issued on January 2, 2014, outlines four new streamlined procedures for reinstating the tax-exempt status of organizations that have had their status automatically revoked for failure to file IRS Form 990s.    

Background

The IRS's proposed bright line test gets it wrong

With respect to the IRS's proposed bright-line test for "candidate-related political activity," the IRS appears to be tone-deaf to the sound of Supreme Court’s instructions as supreme arbiter of constitutional protections. In Federal Election Commission v. Wisconsin Right to Life, 551 U.S. 449 (2007), the Supreme Court specifically rejected the argument that a bright-line test could provide the requisite “compelling government interest” sufficient to satisfy the applicable “strict scrutiny” standard for First Amendment rights of section 501(c)(4) organizations.

“Charity”: A Brief History Lesson

What does “charity” mean?  The IRS defines it broadly as “relief of the poor and distressed or underprivileged; advancement of religion, education, or science, erection of public buildings or monuments or works lessening the burdens of government; promotion of social welfare by organizations designed to accomplish the above purposes or (i) lessen neighborhood tensions; (ii) eliminate prejudice and discrimination; (iii) defend human and civil rights secured by law; or (iv) combat community deterioration and juvenile delinquency.”  That covers quite a bit of territory for “charitable