The IRS recently released its 2013-2014 Priority Guidance Plan, which contains 324 projects the IRS intends to work on during the plan year (July 2013 to June 2014). We are pleased to see that it was released three months earlier this year than the 2013 plan, and hope that bodes well for progress on the following priorities identified by the IRS relative to Exempt Organizations (listed in order of priority, with notes regarding changes from last year).
2013-2014 project list for Exempt Organizations:
- Revenue Procedures updating grantor/donor reliance on IRS determination letter as to “publicly supported” status of grantee (the second year this is priority no. 1)
- Revenue Procedure to update reliance on EO Select Check (on the IRS website) for deductibility and public charity status (the second year that this is priority no. 2)
- Guidance under §501(c)(4) relating to measurement of an organization’s primary activity and whether it is operated primarily for the promotion of social welfare, including guidance relating to political campaign intervention (new)
- Final regulations regarding financial assistance policy and reporting requirements for charitable hospitals; proposed regulations were published on June 26, 2012 (no change)
- Additional guidance on Type III supporting organizations and final regulations (up from no. 6)
- Guidance under §4941 regarding a private foundation’s investment in a partnership in which disqualified persons are also partners (new)
- Final regulations on program-related investments; proposed regulations were published on April 19, 2012 (up from no. 8)
- Guidance regarding the new excise taxes on donor advised funds and fund management (up from no. 9)
- Regulations regarding filing requirements for excise taxes on charitable hospitals that fail to implement community health needs assessment requirement (related to last year’s no. 3)
- Guidance on group returns regulations (no change)
- Final regulations for consolidation/update of non-regulatory exceptions from filing; proposed regulations were published on March 15, 2011 (up from no. 12)
- Final regulations relating to church tax inquiries and examinations; proposed regulations were published on August 5, 2009 (up from no. 13)
New and noteworthy in this year’s Priority Plan:
- Priority number 3: This outlines an effort to assure transparency and consistency in evaluating applications by political organizations and 501(c)(4)s following the IRS scandal earlier this year. On a related note, the IRS instituted a new review process and expedited self-certification option for priority backlog cases.
- Priority number 6: This points to scrutiny by the IRS about a disqualified person’s interest in a partnership and whether that rises to the level of a prohibited exchange or sale.
- Priority number 9: The IRS issued temporary and final regulations post-list release regarding reporting excise taxes due by charitable hospitals who failed to meet requirements around community health needs assessments. Note that the IRS also has released proposed regulations fleshing out requirements for community health needs assessments, in April 2013.
While many of the priorities remain unchanged from last year’s Priority Guidance list, and the IRS does not have to complete these projects within the 2013-2014 year, the Plan is an indicator of where the IRS intends to focus its resources. After the government shutdown is lifted, that is.
For a complete copy of the Priority Guidance document, please visit: http://www.irs.gov/pub/irs-utl/2013-2014_pgp.pdf.
At Leaffer Law Group, we continue to monitor developments in each of these areas, and will advise readers of those developments in future blog postings.