Fall 2011 tax legislative update for exempt organizations

Exempt Organizations Tax Services Update

Against a backdrop of mounting budget pressures at the federal, state, and local levels; a deficit reduction "Supercommittee"; and the early phases of the 2012 presidential election cycle, a polarized Congress has also focused on the charitable sector, with some viewing tax-exempts and IRS administrative actions in this area as ripe for increased oversight and others concerned about the impact of deficit reduction proposals on nonprofits and charitable organizations.

In recent weeks, both the House and Senate tax-writing committees have placed significant emphasis on compliance and reform proposals that would directly impact tax-exempt organizations. Although the future direction of this focus on the tax-exempt sector is not immediately clear, the combination of articles concerning the effectiveness of IRS oversight of tax-exempt organizations appearing in the press and increased Congressional scrutiny suggest that future substantive and reform-based hearings may be expected.

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