In response to presidential candidates finding new ways to utilize anonymous donations from groups that are themselves tax-exempt, regulators at the Internal Revenue Service (IRS) are expected to delay efforts to curb abuses by tax-exempt nonprofits until after the 2016 election. The issue is highlighted by a mushrooming budget on political activities for nonprofit groups. Political activity from nonprofits has grown from $5.8 million in 2004 to $300 million in 2012.
Nonprofit groups are supposed to limit their political activities, but scandal in the IRS over alleged unethical scrutiny of certain, specific groups has rendered the agency largely unable to effectively monitor groups and enforce that requirement. Much of the agency’s inability to clearly handle the increasing politicization of nonprofit groups stems from the vagueness of IRS rules that govern the purpose and activities of nonprofit groups.
Polarization in the Federal Election Commission has made it difficult for them to regulate political activities by nonprofits aligned with Super PACs, further increasing pressure on the quagmired-IRS to act. So far, eight Republican presidential candidates (Bush, Huckabee, Jindal, Kasich, Pataki, Perry, Rubio, and Santorum) have in some way aligned themselves with nonprofits funded by politicos from Karl Rove to the Koch Brothers.
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Law Offices of Darrin T. Mish, P.A.: Tax Attorney