So the IRS Hounded Liberals, Too - But We've Still Got a Problem

So the IRS Hounded Liberals, Too - But We've Still Got a Problem

The IRS scandal, such as it is, has gotten less scandalous in recent days. Revelations that the agency scrutinized exemption applications from liberal as well as conservative groups has deflated some of the more overheated conspiracy theories. And rearguard efforts by conservative activists to keep the scandal sufficiently scandalous have the air of desperation -- or at least opportunism.

But as the scandal recedes, the policy issues remain. The real problem has never been the Obama Administration's supposed political misuse of the IRS (the
fevered imaginings of Peggy Noonan notwithstanding). Rather, it's the misconceived nature - and hamfisted enforcement - of the tax law itself.

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... Although it seems reasonable to me, no one is talking about abolishing the tax exemption (and contribution deductibility) for 501(c)(3) organizations. And since that exemption more or less requires a ban on political activity, the IRS will necessarily be required to make at least binary judgments about electioneering and political activity.

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View Joe Thorndike's opinion in its entirety on the taxanalysts® Blog.

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