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Tax Law

A World Without 501(c)(4)s

Should we get rid of 501(c)(4)s? Last week, the New York Times put that question to a range of tax experts and got back (predictably) a range of reasonable answers. Most involved some sort of intermediate reform involving the political activities of "social welfare" organizations. One expert, however, took the bait and called for complete elimination of 501(c)(4). Which sounds like a good idea to me.

In his Times piece, John D. Columbo of the University of Illinois College of Law
clearly identified the central problem with 501(c)(4)s: they are permitted to engage in some political campaign activity but not too much.

Policing that line is nearly impossible, as the IRS has recently demonstrated. The agency seems to have made some particularly bad decisions in trying to enforce the political restrictions facing 501(c)(4)s, and it probably deserves a good deal of its current misery.


I think we should just ditch 501(c)(4) entirely.


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

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