Other Developments

• Published date: 01 March 2018
• Date: 01 March 2018
• DOI: http://doi.org/10.1002/npc.30445

Bruce R. Hopkins’ NONPROFIT COUNSEL

March 20188THE LAW OF TAX-EXEMPT ORGANIZATIONS MONTHLY

Bruce R. Hopkins’ Nonprofit Counsel DOI:10.1002/npc

they begin operations,” (2) they “can reduce federal

revenue by allowing organizations that should be pay-

ing tax to avoid it,” (3) they are “allowing donors to

claim tax deductions for contributions to organizations

that should not be treated as tax exempt,” and (4) this

process “can undermine public trust in the integrity of

the charitable sector.”

The National Taxpayer Advocate recommends that

the IRS “review an applicant’s narrative statement of

actual or planned activities and the applicant’s organiz-

ing documents before deciding whether to approve the

application for tax-exempt status [sic].” [26.1(h)]

Note: Who knew these small entities “can” have such

an enormous economic and legal tax impact? See the

preceding article. ◆

IRS ISSUES PROCEDURAL

RULES FOR 2018

The IRS issued its annual compilation of the procedural

rules in the tax-exempt organizations and larger law

contexts, for 2018, concerning the issuance of private

letter rulings and technical advice memoranda, nonrul-

ing areas, user fees, and more, including:

• revised procedures for obtaining private letter rulings

and information letters issued by the associate chief

counsel (Tax Exempt and Government Entities) and

others within the IRS, and for determination letters

issued by the TE/GE Division and others within the

IRS (Rev. Proc. 2018-1);

• procedures explaining when and how an associate

office within the Office of Chief Counsel provides

technical advice, conveyed in technical advice memo-

randa, and explaining rights taxpayers have when a

field office requests a TAM (Rev. Proc. 2018-2);

• a revised list of areas of the Internal Revenue Code

under the jurisdiction of the associate chief counsel

(TE/GE) and others within the IRS relating to matters

on which the IRS will not issue letter rulings or deter-

mination letters (Rev. Proc. 2018-3);

• procedures for issuance of determination letters on

issues under the jurisdiction of the director, Exempt

Organization Rulings and Agreements; revocation or

modification of determination letters; guidance on

exhaustion of administrative remedies for purposes

of declaratory judgments (IRC § 7428); and guidance

on user fees for requesting determination letters

(Rev. Proc. 2018-5); and

• procedures for issuance of determination letters in

response to applications for recognition as social

welfare organizations (Form 1041-A) (Rev. Proc.

2018-10). ◆

OTHER DEVELOPMENTS

◆The case styled True the Vote v. United States has

been settled, with the settlement approved by the US

District Court for the District of Columbia. The court

declared that “any action or inaction taken by the IRS

must be applied evenhandedly and not based solely on

a tax-exempt applicant or entity’s name, political view-

point, or associations.” [26.1(j)]

◆The IRS published an updated version of the applica-

tion for recognition of exemption filed by entities seek-

ing 501(c)(3) status (Form 1023, December 2017). The

only change noted by the IRS is addition of agricultural

research organizations (IRC § 170(b)(1)(A)(ix)) to the list

of public charities in Part X. [26.1(e)]

Quote of the Month: The Gazette (Colorado Springs),

on Sunday, December 31, led with this front-page

headline: “Taxing issues for churches, nonprofits.”

Subheadline: “Effects of Republican tax overhaul leg-

islation, Johnson Amendment reversal uncertain.” The

article reported that the Johnson Amendment is “not

being enforced because of an executive order [Presi-

dent] Trump signed in May” and that the “Tax Cuts

and Job Act” has “eliminate[d] the itemized charitable

deductions that 30 percent of American households

have used.” It added that the Johnson Amendment

“has been little understood” since its enactment in

1954. ◆

Each article in the newsletter on a tax-exempt organizations law topic ends with a citation to the appropriate chapter(s) or subchapter(s)

in Hopkins, The Law of Tax-Exempt Organizations, Eleventh Edition (Wiley, 2017 cumulative supplement). This is done to provide

ready access to additional and background information concerning these articles. For example, underlying information concerning

the first article in this issue is available in Chapter 25 §§ 1(g) and 2(b); thus, the citation is referenced as [25.1(g), 25.2(b)]. Likewise,

each article in the newsletter on a charitable giving law topic ends with a citation to the appropriate chapter(s) or subchapter(s) in

Hopkins, The Tax Law of Charitable Giving, Fifth Edition (Wiley, 2017 cumulative supplement). For example, underlying informa-

tion concerning the second article in this issue is available in Chapter 9 § 22 of the book; thus, the citation is referenced as [9.22].

This newsletter is a stand-alone publication. An inventory of articles in the newsletter since its inception in 1983, and a subject mat-

ter index, as well as an index of the court opinions, IRS revenue rulings and procedures, IRS technical advice memoranda, and IRS

private letter rulings discussed in the newsletter, are available at www.brucerhopkinslaw.com. For those who have the books, the

newsletter also provides monthly updates. Both books are annually supplemented. Questions concerning nonprofit law develop-

ments in general may be sent to brucerhopkins@brucerhopkinslaw.com. Also, a comprehensive summary of nonprofit law is avail-

able in the Bruce R. Hopkins Nonprofit Law Library, an e-book published by Wiley. Follow BRHopkins_NPLaw on Twitter.

The newsletter has a dedicated website. Please visit www.hopkinsnonprofitcounsel.com.