Tea Party stopped an IRS power grab and scored a huge victory for free speech

A month after the Internal Revenue Service postponed proposed rules that would have severely restricted the activities of nonprofit groups, ostensibly codifying a Democratic Party wishlist of restrictions on free speech, the powerful tax agency announced yesterday that it will rewrite the regulations:

The IRS said it will start writing a revised regulation amid criticism from both the left and especially the right, on the proposal to tighten rules governing the tax-exempt status of so-called social welfare organizations.

“Given the diversity of views expressed and the volume of substantive input, we have concluded that it would be more efficient and useful to hold a public hearing after we publish the revised proposed regulation,” said an IRS statement to reporters Thursday.

That’s a significant win for conservative groups targeted by the IRS as well as groups from all ideological stripes — including the ACLU, FreedomWorks, that fought against them. The new rules will not be finalized until at least next year. The catch, however, is that the IRS isn’t scrapping the rules, entirely:

The agency says the rule will keep many of the same elements as the original proposal but will take the record number of comments into consideration for a new version. Some 150,000 written comments poured in, a record for the Treasury Department.

The new rule, an IRS official said the move “certainly is not starting over and certainly not starting from scratch.”
The IRS would not say how much of the rule would be re-written, nor what would change specifically, nor when to expect the new draft.

Ted Cruz urges IRS to scrap proposed anti-speech regulations

Sen. Ted Cruz (R-TX) has fired off a letter to IRS Commissioner John Koskinen urging him to kill proposed regulations that will stifle free speech and, instead, rely on Federal Election Commission rules that define political activity related to outside organizations.

“It is disturbing that the IRS is proposing new rules that would attempt to further limit the free speech rights of Americans, while the IRS and the Department of Justice still refuse to provide the American people with all the facts surrounding the IRS’s targeting of certain organizations based on their political activity,” Cruz wrote in the letter (embedded below).

“The IRS’s proposed rules would stifle political activity by preventing 501(c)(4) groups from engaging in political speech and voter registration that these groups have been engaged in for decades,” he continues. “Given the IR’s recent targeting of conservative groups based on their political activity, these rules would only further politicize an already trouble agency.”

The rules include the basic tenets of the DISCLOSE Act, a measure pushed by Democrats since the 2010 Supreme Court ruling in Citizens United, which was a landmark victory for free speech.

The rules would have the effect of silencing outside groups, preventing them from participating in the public policy process. By requiring outside groups to disclose contributions, it will give those who oppose them the ability to bully their donors.

Former IRS Officer Drafted Secret Regulations Restricting Non-Profits in 2012

After President Barack Obama defended his administration’s handling of the Internal Revenue Service’s targeting of conservatives, an email sent from Treasury official Ruth Madrigal to then IRS official Lois Lerner obtained by the House Committee on Ways and Means, indicated the former official’s intentions to change 501(c)(4) regulations without disclosing the move.

The “off-plan” to which the email referred to was planned in 2012, while conservative groups were being directly targeted by the IRS. According to The Daily Caller, the rules thought out by Lerner restrict the political activity of conservative groups by keeping non-profit associations from being free to participate in several political activities.  The “off-plan” changed what the IRS sees as “candidate-related political activity,” placing previously acceptable activities like voter registration drives under the political activity category, thus not recommended for 501(c)(4)’s.

Ways and Means chairman Rep. Dave Camp (R-MI) had harsh words regarding Lois Lerner and her off-the-record plan during the House committee meeting that disclosed the contents of the email.

House Republican seeks to halt pending IRS guidance

Rep. Dave Camp (R-MI) has introduced legislation that would temporarily halt the Internal Revenue Service from finalizing proposed guidance that would legitimatize and institutionalize the agency’s targeting of conservative groups.

Just before the Thanksgiving holiday, the Treasury Department and Internal Revenue Service (IRS) announced the issuance of proposed guidance for organizations seeking tax-exempt status. The proposed rules would define “candidate-related political activity” and exclude groups that engage in this activity from receiving non-profit status and require them to disclose donors.

Camp, who chairs the powerful House Ways and Means Committee, questioned the motivation behind the rules, noting that a congressional inquiry into the IRS’s targeting of conservative groups is not yet complete.

“Despite the Administration’s insistence that ‘there’s nothing to see here,’ the Committee has found evidence demonstrating that right-leaning groups were targeted to an extent far beyond what was reported by the Inspector General,” said Camp in a statement.

“Our investigation is still ongoing and the Committee has not received all the requested documents,” he said. “It is premature to publish new rules before getting all of the facts.

Camp said that the proposed guidance would target groups exercising their First Amendment rights.

“We cannot allow these draft regulations to go into effect. Congress must make sure every American’s right to participate and engage in civic debate is protected, and this legislation will provide some much-needed assurance that IRS targeting and surveillance will not continue,” he added.

Administration in a panic, urging insurers to cover customers who haven’t paid

In the latest signs of desperation over Obamacare, the Department of Health and Human Services (HHS) announced late last week that it is taking steps to extend a federal high-risk pool program by one month and is “urging” insurers to cover customers who selected plans on January 1, even if they haven’t made a premium payment.

The Pre-existing Condition Insurance Plan (PCIP), a high-risk pool for those considered uninsurable, was set to end at the end of December, but the one-month extension of the program is notable because these customers were set to enter the Obamacare exchanges. But the extension of the program is an obvious move to lessen the impact of expected premiums hikes for 2015, a sign that HHS has a gloomy outlook on enrollment numbers.

“By delaying this population’s entry into the pool for just one month, the administration’s decision will mean insurers have one less month of real claims data to use in setting premiums for 2015, no small matter when only three or four months’ worth of data will be used, potentially shaving a point or two, or even more, off of the insurer’s claims experience,” wrote Sean Parnell last week at The Federalist.

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