Posted on 04/05/2005 9:39:29 AM PDT by Liz
Charities and other nonprofits exempted from taxes because they serve a public purpose have become a hotbed of tax evasion and abuse, according to the head of the Internal Revenue Service.
"We can see that tax abuse is increasingly present in the sector," and unless the government takes effective steps to curb it, such organizations risk "the loss of the faith and support that the public has always given to this sector," Internal Revenue Commissioner Mark W. Everson said in a letter to the Senate Finance Committee detailing abuses his agency has found.
Everson said that the IRS is finding problems in virtually every type of tax-exempt organization. Nonprofits include not only charities, but colleges and universities, many hospitals, pension plans, trade associations and think tanks. In fact, eight of the 10 largest private employers in the District are nonprofits.
"Unfortunately, we have no precise way to gauge the revenue impact of these issues," Everson said, though he noted that the nonprofit sector, including pension plans and the like, now totals roughly 3 million entities controlling $8 trillion in assets.
Feds probe abuse "It's a seminal letter that rips off the rose-colored glasses with which we usually look at tax-exempt organizations," Senate Finance Chairman Charles E. Grassley (R-Iowa) said yesterday. "What's going on isn't a pretty picture in the harsh light."
The Finance Committee began examining the nonprofit sector last summer, finding, among other things, that localities and transit systems were collecting fees for allowing corporations to benefit from tax shelters designed to help finance public works. Several provisions of last fall's tax bill were aimed at abuses uncovered by the panel, but members have suspected, and Everson's letter confirms, that many more exist. Another hearing will begin today.
The findings have already sent alarms through the nonprofit community.
(Excerpt) Read more at msnbc.msn.com ...
Under the aegis of the ACLU's Foundation---worth some $135 million---any number of financial travesties can be hidden. The IRS should determine whether the ACLU is properly accounting for all its tax-funded activities, whether it is inflating legal costs, and whether it is using tax dollars for the purposes stated. We need to know whether the ACLU is engaged in Enron-style accounting and spending practices. How did the ACLU accumulate so much money? Because our taxes are used to subsidize these nefarious organization.
In 1976, Congress passed the Civil Rights Attorneys Fee Awards Act, which was designed to encourage private lawyers to take on suits to protect civil and constitutional rights. The law provides that judges can order federal and state governments to pay legal fees to private lawyers who sued the government and won.
The result has been a flood of civil rights cases in federal court. From The New American Feb. 2, 1987 FReepers can silence the ACLU with a bit of activism. We need to insist our Congressmen repeal this abusive law that allows the ACLU to get rich on harassing Christian America. Congress must repeal laws enabling the ACLU's Christian-hating activities. Cut off the ACLU's funds and watch them disappear.
Here's what we can do.
REFERENCE SOURCE FOR ARGUING REPEAL TO CONGRESS Apparently, when Congress contemplated the fee-shifting bill three decades ago, it never conceived that 42 U.S.C. §1988 would be used to secure fees in esoteric battles over the meaning of the establishment clause of the First Amendment.
The statute gives a court "discretion" to award attorneys' fees to the prevailing party in civil rights cases. Study of the legislative history of the statute reveals that Congress intended this statute to apply to civil rights abuses, including certain race and sex discrimination cases, but not to arguments about whether Judge Roy Moore is allowed to display the Ten Commandments in the Alabama courthouse. During the deliberations on the bill, the Senate penned that "in many cases arising under our civil rights laws, the citizen who must sue to enforce the law has little or no money with which to hire a lawyer."[6]
In the recent First Amendment lawsuits filed by the ACLU, the tables are turned. Small school districts and municipalities can either defend lawsuits and risk paying the ACLU's attorneys' fees if they lose, or they can voluntarily submit to the ACLU' view of the Constitution.
Even if lawsuits over the establishment clause somehow fall within 42 U.S.C. §1988, the statute empowers courts with nothing more than "discretion" to award fees.
In these cases, one would expect courts to withhold awarding fees. Since this is not happening, Congress must take immediate action to clarify 42 U.S.C. §1988 to explicitly exclude lawsuits related to the acknowledgement of God.
ACLU AGITA------The findings have already sent alarms through the nonprofit community.
All the officers should be paid official minimum wage (max 40 hrs/week), problem solved.
Start with the NAACP, the ACLU and the Rainbow-Push coalition...
ping
P.S. He is probably getting twice that much now.
Why not just get rid of the IRS and Income Tax. That would end the abuse and make things better for everyone. I mean can anyone really figure out the tax code?????
The liberals really don't want that because they somehow manage to get ahold of many of the charities set up by gazillionaires and use them to fund their pet communist/socialist projects.
If you would like to be added to this ping list let me know.
John Linder in the House(HR25) & Saxby Chambliss Senate(S25), offer a comprehensive bill to kill all income and SS/Medicare payroll taxes outright, and provide a IRS free replacement in the form of a retail sales tax:
H.R.25,S.25
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.Refer for additional information:
Thanks Liz. There is a special ACLU/PFAW section in the Toolkit, please ping and bump!
FR March For Justice II Grassroots Activism Toolkit
http://www.freerepublic.com/focus/f-news/1374533/posts
In other news, the sky is blue, bears take dumps in the woods, and the next pope will be Catholic (Christiane Amanpour notwithstanding)
The problem is that Senator Grassley's desired regulatory changes would amount to a shot gun trying to hit a few killer bees in a hive of honey bees. That killer bees are very dangerous and offensive, but the likelyhood is that the majority of casualties will be some honey bees, and the loss of their needed honey.
As noted by Heather R. Higgins in yesterday's Wall Street Journal (April 4, 2005, page A15):
"The [Senate] committee's own proposals would impose burdens that are well beyond the capabilities of most non-profits. Of 65,000 foundations, only 46, or 0.06% have assets over $1 billion. Most have assets under $50 million. And of the roughly 1.4 million public charities, about 94% have revenue of $1 million or less; 98% have revenue of less than $5 million. Most are run by small staffs with small budgets."
"These smaller non-profits are where people with problems often find help...."
The data on actual, as opposed to perceived, abuses is so limited and poor, by the IRS own admission, that would be better for Congress to require factual studies in various non-profit sectors before imposing a blunderbuss of a regulatory regime.
As Ms. Higgins continued:
"Despite concerns that the IRS and state attorneys general haven't the where-withal to adequately examine current filings, the proposals include myriad new filings at a stricter and more severe liability standard, similarly to publicly held business corporations. These additional compliance dollars will be a millstone for charities that are local and non-bureaucratic. ......these proposals will force even more donor dollars into non-core costs for dubious public benefit."
"Under these proposals, virtually anyone could see a charity's filed documents, public or private and, most ominous of all, [anyone] will have standing to file a complaint - effectively transferring a policing function to anyone with an ax to grind. Failure by a charity to file certain documents could result in immediate revocation of its tax exemption, essentially a death penalty for a charity......"
Can you imagine how easy it would be for some activist group to shut down your local Church-related charity agency, simply due to the costs of having to defend their position in the new regulatory regime, based only a spurious complait that the IRS spends years to adjudicate.
Large non-profits will hire enough lawyers to get off the hook, find legal loop holes or get "consent" decrees that admit no wringdoing at let them off with a small fine and a promise to behave in the future.
Congress should fund and require extensive economic, tax and legal studies, including comparisons between different non-profit sectors before any new regulatory regime is put in place.
Grassley's rule changes would seriously injur the most simple charities, like your local Church-run day care center, vastly raising their legal risks and administrative costs, while only slightly raising the costs of the non-profit giants that can well afford the attorneys, legal fees and administrative overhead that the new volumes of regulations will create. It amounts to a "throwing the baby out with the bath water" approach. It is congressional grandstanding and over-reach.
Thanks. Very informative.
There is a useful ACLU/PFAW section in the Toolkit (link below), please ping and bump your lists to this thread:
FR March For Justice II Grassroots Activism Toolkit
http://www.freerepublic.com/focus/f-news/1374533/posts
There is a useful ACLU/PFAW section in the Toolkit (link below), please ping and bump your lists to this thread:
FR March For Justice II Grassroots Activism Toolkit http://www.freerepublic.com/focus/f-news/1374533/posts
Good point, then let's bring this to Grassley's attention.
Laws should be written to exclude N/P's under a certain income.
National Sales Tax would end this.
If the Government were as worried about our National Borders as they are about robbing us of our Money, the border would be shut down and Vincente Fox would be in a Texas Jail.
Might also include PFAW, Americans United for Separation for Church and State, and a lot of other Christian-hating groups........or would that look too vindictive? (laughs uproariously)
Ole.
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