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Monday, April 20, 2015

House Gift Tax Bill Seen as Guarding Against IRS Targeting

Legislation passed quietly by the House on Wednesday to shield large donors from paying gift taxes on contributions to certain political groups was seen by conservatives as a way to prevent the IRS from targeting tea party and related organizations.

"If the law is clear, everyone knows what the rules are and can follow them, and I think that’s a better situation," Elizabeth Kingsley, an attorney at the Harmon, Curran, Spielberg & Eisenberg law firm, told Politico.

Kingsley was among a group of conservative and liberal nonprofits and lawyers who sent a letter to House lawmakers supporting the bill.

The letter argued that "application of the gift tax to 501(c)(4) donors raises serious constitutional questions, and threatens to hamstring smaller or start-up citizens’ groups," Politico reports.

Kingsley said the bill equalized the playing field for donors, since the vagueness of the current law impeded cautious donors — and aided those who were more comfortable with making larger donations, according to the report.

Proposed by Illinois Rep. Peter Roskam, the Republican chairman of a House subcommittee that oversees the IRS, the bill specifically state that the federal gift tax does not apply to groups registered under sections 501(c)4, (c)5 or (c)6 of the tax code.

The classifications encompass a broad range of both liberal and conservative groups, Politico reports.

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