The Rio Grande Foundation is a 501c3 organization under the IRS Code. We operate as a public policy research “think tank” that deals with economic policy issues here in New Mexico. We are based in Albuquerque, New Mexico.
The Rio Grande Foundation supports IRS guidance that eliminates unnecessary reporting requirements for exempt nonprofit organizations. On September 10, 2019, the Internal Revenue Service announced proposed rulemaking to eliminate donor disclosure requirements for certain nonprofit organizations. In 2015, laws regarding gift taxes and nonprofit organizations changed. As a result, there was no longer a tax administration need for the IRS to continue collecting donor information from certain nonprofits. IRS guidance was announced in 2018 stating that those certain nonprofit groups no longer needed to report the private information of their donors, including names and addresses, on Form 990, Schedule B of their annual returns.
Making a donation to support an organization or cause you believe in is a way to express your personal views and exercise your constitutional right to freedom of speech and association. That support can and should be private if that is the preference of the donor.
Whether the case is state and local laws or the IRS regulation that is being revised for the better here, the term “transparency” has been co-opted as an excuse for the government to collect private information – information of no practical use to it – about the activities of ordinary citizens. “Transparency” is a buzzword that should apply to government at all levels and its activities. It is spending our tax dollars and should thus be beholden to the public in ways that average citizens should not.
In our work we have been forced to deal with local campaign finance disclosure legislation that appears to be designed with the intention of making it difficult to impossible for average citizens to engage in public policy debates. Government disclosure requirements should not stifling political speech.
Additionally, examples abound from all over the nation of people who have been picked on and ostracized for donating to a political cause or expressing unpopular political beliefs. The proposed regulations take a small but significant step towards defusing some of the tension created by the unnecessary forced disclosure of personal information.
Of course once it is collected, data can be used and misused. The large-scale collection and storage of donor information is a risky endeavor with potentially serious consequences. There is always the potential for private details to be leaked – either unintentionally by a careless employee, or intentionally by a rogue employee or politician looking for revenge against a political opponent.
For these reasons and others we strongly support the proposed IRS guidance.
If you are concerned about the federal government’s new rules in support of donor privacy comments can be submitted online here no later than December 9, 2019. https://www.regulations.gov/docket?D=IRS-2019-0039