Obama administration proposes new rules to rein in groups that are spending millions of dollars to hijack politics in this country. Tea Party heads to explode in 3..2..well you get the idea.

Courtesy of Accounting Today:  

The Treasury Department and the Internal Revenue Service said Tuesday they are issuing initial guidance regarding qualification requirements for tax-exemption as a social welfare organization under Section 501(c)(4) of the Tax Code after a scandal erupted earlier this year over claims that the IRS was targeting Tea Party groups applying for tax-exempt status. 

The proposed guidance defines the term “candidate-related political activity,” and would amend the current regulations by indicating that the promotion of social welfare does not include this type of activity. The proposed guidance also seeks initial comments on other aspects of the qualification requirements, including what proportion of a 501(c)(4) organization’s activities must promote social welfare. The initial guidance is expected to be posted on the Federal Register later today. 

The Treasury is issuing the guidance in response to a recommendation in a report from the Treasury Inspector General for Tax Administration on how the IRS selected inappropriate criteria for screening applications from tax-exempt status from various groups. Ahead of the release of the TIGTA report. Lois Lerner, the former head of the IRS’s Exempt Organizations, touched off a firestorm of criticism of the IRS after she disclosed in May that the agency was using terms such as “Tea Party,” “Patriot” and “9/12” to filter through applications for 501(c)(4) tax-exempt status from conservative organizations. It later emerged that the IRS was also using terms like “progressive” and “Occupy” to filter out applications from liberal groups. Lerner was eventually forced out of the agency along with other officials such as former acting commissioner Steven T. Miller. 

His replacement, the current IRS acting commissioner Danny Werfel, has pledged to stop using so-called “BOLO,” or “Be on the Lookout,” lists, and to enable streamlined processes for tax-exempt status including allowing 501(c)4 organizations to self-certify themselves as tax-exempt until their applications have been examined. Meanwhile Congress has been grilling IRS officials at a contentious series of hearings and introducing legislation as recently as last week to reform the process further (see Congress Introduces Bill to Change IRS Reviews of Tax-Exempt Organizations). 

The TIGTA report recommended that the Treasury Department and the IRS chief counsel develop guidance on how to measure the primary activity of 501(c)4 social welfare organizations.

The whole kerfuffle over the IRS trying to determine who was gaming the system, which used key words like "Tea Party" and "Patriot" to identify groups that required extra scrutiny, would be completely unnecessary once these new guidelines are in place.

Then the conservatives could not accuse the IRS of targeting them, because the new rule changes would affect EVERY group who claimed to be a "social welfare group" but were in fact partisan smear merchants.

Of course, as you can imagine, this rule change has already sparked anger from one side of the political aisle: 

"The fact that the administration's new effort only affects social welfare organizations - and not powerful unions or business groups - underscores that this is a crass political effort by the administration to get what political advantage they can, when they can," said Representative Darrell Issa, a California Republican. Some of the biggest spenders in the last election also expressed outrage at the proposal.

In my opinion ANY rule change that pisses off Darell Issa is a good rule change.

And remember there is NOTHING saying these groups cannot exist, that would be un-American, they simply cannot claim tax exempt status.