The Trump administration is reportedly preparing a series of structural and leadership changes at the Internal Revenue Service (IRS) that could expand the agency’s ability to pursue criminal investigations of certain nonprofit and tax-exempt organizations.
The proposed changes would give the Internal Revenue Service (IRS) Criminal Investigations Division (IRS-CI) greater latitude to initiate probes. The move has raised concern among nonprofit leaders about potential politicization of enforcement.
The Trump administration is reportedly preparing a series of structural and leadership changes at the IRS that could expand the agency's ability to pursue criminal investigations of certain nonprofit and tax-exempt organizations.
The proposed changes would give the IRS Criminal Investigations Division (IRS-CI) greater latitude to initiate probes. The move has raised concern among nonprofit leaders about potential politicization of enforcement.
For associations and other tax-exempt organizations, the proposed changes could represent a significant shift in how the IRS handles sensitive investigations involving nonprofit status.
Currently, IRS-CI investigations involving tax-exempt entities require extensive legal oversight and documentation under the agency’s internal manual.
If those procedural checks are reduced, tax-exempt organizations could face faster-moving inquiries with less opportunity for legal review before enforcement actions are initiated.
“While the administration’s focus so far seems to be particularly on private foundations, such as that of George Soros, that the administration alleges have funded organizations fomenting violence, the prospect of federal criminal investigations or prosecutions of any tax-exempt organizations is harrowing and will be watched closely by ASAE,” said Jerald Jacobs, partner at Pillsbury Winthrop Shaw Pittman LLP and general counsel to ASAE.
OSAP and ASAE will keep members informed as more information becomes available about potential structural changes within the IRS or new procedures for investigating tax-exempt organizations.
This article was provided to OSAP by ASAE's Power of Associations and Inroads.