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Thursday, March 23, 2023
Mayer: Nonprofits, Taxes, And Speech
Lloyd Hitoshi Mayer (Notre Dame; Google Scholar), Nonprofits, Taxes, and Speech, 56 Loy. L.A. L. Rev. __ (2023):
Federal tax regulation is of two minds with regards to speech by nonprofits. The tax advantages supplied to nonprofits are justified in vital half as a result of they supply nonprofits nice discretion in selecting the precise ends and means to pursue, thereby selling range and pluralism. However present regulation withholds a few of these tax advantages if a nonprofit engages in sure varieties of political speech. Legislators have additionally repeatedly, if unsuccessfully, sought to develop these political speech restrictions in varied methods. And a few commentators have proposed denying tax advantages to teams engaged in different varieties of disfavored speech, together with hate speech and pretend information. These latter proposals have just lately change into extra outstanding as extra details come to mild concerning the position of nonprofits in supporting white supremacy and in disseminating deceptive details about COVID-19 remedies.
This Article explores the prevailing and proposed limitations on speech by tax-exempt nonprofits given the constitutional restrictions on such limitations and the coverage justifications for present nonprofit tax advantages.
It explains why the prevailing limits on political marketing campaign intervention and lobbying by charities are each justified given the subsidy supplied to charities and their supporters underneath present federal tax regulation and constitutional given present and longstanding case regulation. It additional concludes that any enlargement of those limits on charities to cowl different varieties of speech, together with hate speech and pretend information, can be inconsistent with the prevailing broad definitions of the needs that charities can pursue in addition to, in some circumstances, constitutionally suspect. It additionally concludes that limits on speech by non-charitable tax-exempt nonprofits, together with the prevailing restrict on political marketing campaign intervention for a few of these nonprofits, is each unwise as a coverage matter and, in some circumstances, constitutionally suspect given the shortage of a subsidy for such speech by these nonprofits.
https://taxprof.typepad.com/taxprof_blog/2023/03/mayer-nonprofits-taxes-and-speech.html
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