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Nonprofit leaders brace for possible targeting by the Trump administration after tax measure advances in Congress
Nonprofit leaders brace for possible targeting by the Trump administration after tax measure advances in Congress

Yahoo

time17-05-2025

  • Politics
  • Yahoo

Nonprofit leaders brace for possible targeting by the Trump administration after tax measure advances in Congress

A House measure that would make it easier to yank the tax-exempt status of nonprofits the Trump administration deems as supporting terrorism marks the latest effort by the president and his Republican allies to hobble organizations that oppose his agenda, some nonprofit leaders argue. The provision comes as President Donald Trump has used the powers of his office in extraordinary ways to target top law firms, elite universities and other perceived political enemies. Last month, for instance, Trump directed his Justice Department to launch a probe of ActBlue, the main fundraising platform for Democratic candidates and liberal causes. The language – added this week by the House's tax-writing committee to the massive 'One Big Beautiful Bill Act' that's a top priority for Trump – would allow the Treasury secretary to suspend the tax-exempt status of organizations the administration says are 'terrorist supporting.' More than 200 groups – ranging from the American Library Association to the Sierra Club – recently signed onto a public statement urging the House to remove the provision. They say it's a tool for the president to take aim at his opponents. 'We have seen this administration use every lever of power they have been able to grab to target the people they see as their enemies,' said Cole Leiter, executive director of Americans Against Government Censorship, one of the groups objecting to the House language. 'This is a broad-based weaponization of government, and this is only the latest manifestation of that.' Nonprofit groups fear more is on the way – with a White House deadline looming for government agencies to identify large publicly traded corporations, foundations and nonprofits, universities and state and local bar and medical associations for potential civil investigations. In a statement, a White House official contended that Trump is operating within his rights and the law. 'President Trump will always stand for law and order, ending the weaponization of the legal system, and rooting out fraud in the federal government,' said White House spokesperson Harrison Fields in an email to CNN, echoing the president's familiar refrain that the Biden administration used the judicial system against him when Trump was out of office. 'Every action he has taken in his second term reflects these priorities and is authorized by the Constitution,' Fields said. 'Outside groups that ignored the previous administration's egregious legal abuses against President Trump have no credibility today.' The tax provision, recently added to a nearly 400-page legislative proposal by the GOP-controlled House Ways and Means Committee, hews closely to language in a bill written by New York Republican Rep. Claudia Tenney that the House approved in the last Congressional session but did not pass the Senate. It would allow the Treasury secretary to suspend the tax-exempt status of charities the secretary determines have provided 'material support or resources' to an organization the government has designated as a terrorist organization. Aides to Tenney and Ways and Means Chair Missouri Rep. Jason Smith did not respond to CNN's inquiries about the measure. During floor debate on the Tenney bill last November, Smith said lawmakers have a 'duty to make sure that taxpayers are not subsidizing terrorism.' Groups opposing the measure said it lacks adequate safeguards to protect organizations' due-process rights. Kia Hamadanchy, a senior policy counsel with the ACLU, noted that it already is illegal to provide material support to a terrorist organization. The new provision, Hamadanchy said, is problematic because gives the Treasury secretary exclusive discretion to designate a group as terrorist-supporting and would allow the agency to suspend a nonprofit's tax-exempt status 'before you've had a chance to go before a neutral decision maker like a judge.' Lisa Gilbert – the co-president of the liberal watchdog group Public Citizen – said she fears organizations with international networks could unwittingly become ensnared should the provision become law. 'Think about foreign humanitarian aid, for example, or groups that receive funds from foundations that are not solely based in the United States,' he said. 'There is a lot of activity that could be swept up.' The White House referred questions about the bill's language to the Treasury Department. A Treasury spokesperson declined to comment. The overall bill currently faces a rocky path in the House, although the chamber's Republican leaders have said they want to bring it to the floor for a vote next week. A group of GOP hardliners on Friday blocked its passage in a key committee as they demanded steeper cuts and changes to its Medicaid provisions. If the bill passes the House, organizations opposed to the language regarding nonprofits' tax status say they will fight to kill it in the Senate. The legislation deals with a range of the president's priorities, from tax cuts to immigration enforcement. But to pass it through Congress, where Republicans hold slim majorities in both chambers, GOP leaders are relying on a tool called budget reconciliation – allowing a simple majority to approve it without any Democratic votes. Under strict Senate rules, however, the chamber's parliamentarian must determine whether its provisions have an actual impact on the budget, not merely an 'incidental' one. An early analysis by a congressional joint taxation panel found the provision has a 'negligible' effect in revenue, buoying opponents' hopes that it could be stripped from the larger bill in the Senate. Federal law bars the president from ordering tax investigations of specific people or organizations, but Trump has publicly threatened to revoke the tax-exempt status of Harvard University for refusing to accede to his policy demands. In remarks last month about Harvard's tax status, Trump indicated other organizations could be targeted, and singled out Citizens for Responsibility and Ethics in Washington, or CREW, a nonprofit watchdog group that tackles public corruption and has sued the Trump administration over several of its actions. Some nonprofit leaders now are warily watching for other potential administration moves, arising from executive order that Trump signed January 21, aimed at encouraging the private sector to end what the administration deems as 'illegal discrimination.' Among other things, the order directed agencies to identify up to nine potential targets among foundations, corporations, colleges and other entities, for 'civil compliance' probes as part of the administration's effort to root out diversity, equity, inclusion and accessibility policies. Groups that could be subjected to scrutiny include what the order calls 'large' nonprofits and associations, foundations with assets of at least $500 million and colleges and universities with endowments that top $1 billion. Attorney General Pam Bondi already has directed the department's Civil Rights Division to review whether universities are trying to skirt a 2023 Supreme Court ruling that said schools could no longer take race into consideration as a specific basis for granting admission. A Justice Department task force aimed at combatting antisemitism on campuses is also investigating nearly a dozen universities and the entire University of California system. Trump's Jan. 21 order also calls on the attorney general to issue a report to the White House recommending actions within 120 days – a deadline that will arrive next week. But it's not clear whether lists of potential targets have been assembled or will be released publicly. A DOJ spokesperson did not respond to an inquiry about the report. Even so, leaders of nonprofit groups are having conversations with their lawyers and looking for ways to avoid risks and prepare for potential audits, several people familiar with internal discussions tell CNN. 'People are trying to brace for it,' said Gilbert of Public Citizen. 'It's very unclear what it will mean to be on a list in Trump's America.' CNN's Hannah Rabinowitz contributed to this report.

Nonprofit leaders say they are bracing for potential targeting by the Trump administration after a controversial tax measure advances in Congress
Nonprofit leaders say they are bracing for potential targeting by the Trump administration after a controversial tax measure advances in Congress

CNN

time17-05-2025

  • Politics
  • CNN

Nonprofit leaders say they are bracing for potential targeting by the Trump administration after a controversial tax measure advances in Congress

A House measure that would make it easier to yank the tax-exempt status of nonprofits the Trump administration deems as supporting terrorism marks the latest effort by the president and his Republican allies to hobble organizations that oppose his agenda, some nonprofit leaders argue. The provision comes as President Donald Trump has used the powers of his office in extraordinary ways to target top law firms, elite universities and other perceived political enemies. Last month, for instance, Trump directed his Justice Department to launch a probe of ActBlue, the main fundraising platform for Democratic candidates and liberal causes. The language – added this week by the House's tax-writing committee to the massive 'One Big Beautiful Bill Act' that's a top priority for Trump – would allow the Treasury secretary to suspend the tax-exempt status of organizations the administration says are 'terrorist supporting.' More than 200 groups – ranging from the American Library Association to the Sierra Club – recently signed onto a public statement urging the House to remove the provision. They say it's a tool for the president to take aim at his opponents. 'We have seen this administration use every lever of power they have been able to grab to target the people they see as their enemies,' said Cole Leiter, executive director of Americans Against Government Censorship, one of the groups objecting to the House language. 'This is a broad-based weaponization of government, and this is only the latest manifestation of that.' Nonprofit groups fear more is on the way – with a White House deadline looming for government agencies to identify large publicly traded corporations, foundations and nonprofits, universities and state and local bar and medical associations for potential civil investigations. In a statement, a White House official contended that Trump is operating within his rights and the law. 'President Trump will always stand for law and order, ending the weaponization of the legal system, and rooting out fraud in the federal government,' said White House spokesperson Harrison Fields in an email to CNN, echoing the president's familiar refrain that the Biden administration used the judicial system against him when Trump was out of office. 'Every action he has taken in his second term reflects these priorities and is authorized by the Constitution,' Fields said. 'Outside groups that ignored the previous administration's egregious legal abuses against President Trump have no credibility today.' The tax provision, recently added to a nearly 400-page legislative proposal by the GOP-controlled House Ways and Means Committee, hews closely to language in a bill written by New York Republican Rep. Claudia Tenney that the House approved in the last Congressional session but did not pass the Senate. It would allow the Treasury secretary to suspend the tax-exempt status of charities the secretary determines have provided 'material support or resources' to an organization the government has designated as a terrorist organization. Aides to Tenney and Ways and Means Chair Missouri Rep. Jason Smith did not respond to CNN's inquiries about the measure. During floor debate on the Tenney bill last November, Smith said lawmakers have a 'duty to make sure that taxpayers are not subsidizing terrorism.' Groups opposing the measure said it lacks adequate safeguards to protect organizations' due-process rights. Kia Hamadanchy, a senior policy counsel with the ACLU, noted that it already is illegal to provide material support to a terrorist organization. The new provision, Hamadanchy said, is problematic because gives the Treasury secretary exclusive discretion to designate a group as terrorist-supporting and would allow the agency to suspend a nonprofit's tax-exempt status 'before you've had a chance to go before a neutral decision maker like a judge.' Lisa Gilbert – the co-president of the liberal watchdog group Public Citizen – said she fears organizations with international networks could unwittingly become ensnared should the provision become law. 'Think about foreign humanitarian aid, for example, or groups that receive funds from foundations that are not solely based in the United States,' he said. 'There is a lot of activity that could be swept up.' The White House referred questions about the bill's language to the Treasury Department. A Treasury spokesperson declined to comment. The overall bill currently faces a rocky path in the House, although the chamber's Republican leaders have said they want to bring it to the floor for a vote next week. A group of GOP hardliners on Friday blocked its passage in a key committee as they demanded steeper cuts and changes to its Medicaid provisions. If the bill passes the House, organizations opposed to the language regarding nonprofits' tax status say they will fight to kill it in the Senate. The legislation deals with a range of the president's priorities, from tax cuts to immigration enforcement. But to pass it through Congress, where Republicans hold slim majorities in both chambers, GOP leaders are relying on a tool called budget reconciliation – allowing a simple majority to approve it without any Democratic votes. Under strict Senate rules, however, the chamber's parliamentarian must determine whether its provisions have an actual impact on the budget, not merely an 'incidental' one. An early analysis by a congressional joint taxation panel found the provision has a 'negligible' effect in revenue, buoying opponents' hopes that it could be stripped from the larger bill in the Senate. Federal law bars the president from ordering tax investigations of specific people or organizations, but Trump has publicly threatened to revoke the tax-exempt status of Harvard University for refusing to accede to his policy demands. In remarks last month about Harvard's tax status, Trump indicated other organizations could be targeted, and singled out Citizens for Responsibility and Ethics in Washington, or CREW, a nonprofit watchdog group that tackles public corruption and has sued the Trump administration over several of its actions. Some nonprofit leaders now are warily watching for other potential administration moves, arising from executive order that Trump signed January 21, aimed at encouraging the private sector to end what the administration deems as 'illegal discrimination.' Among other things, the order directed agencies to identify up to nine potential targets among foundations, corporations, colleges and other entities, for 'civil compliance' probes as part of the administration's effort to root out diversity, equity, inclusion and accessibility policies. Groups that could be subjected to scrutiny include what the order calls 'large' nonprofits and associations, foundations with assets of at least $500 million and colleges and universities with endowments that top $1 billion. Attorney General Pam Bondi already has directed the department's Civil Rights Division to review whether universities are trying to skirt a 2023 Supreme Court ruling that said schools could no longer take race into consideration as a specific basis for granting admission. A Justice Department task force aimed at combatting antisemitism on campuses is also investigating nearly a dozen universities and the entire University of California system. Trump's Jan. 21 order also calls on the attorney general to issue a report to the White House recommending actions within 120 days – a deadline that will arrive next week. But it's not clear whether lists of potential targets have been assembled or will be released publicly. A DOJ spokesperson did not respond to an inquiry about the report. Even so, leaders of nonprofit groups are having conversations with their lawyers and looking for ways to avoid risks and prepare for potential audits, several people familiar with internal discussions tell CNN. 'People are trying to brace for it,' said Gilbert of Public Citizen. 'It's very unclear what it will mean to be on a list in Trump's America.' CNN's Hannah Rabinowitz contributed to this report.

Nonprofit leaders say they are bracing for potential targeting by the Trump administration after a controversial tax measure advances in Congress
Nonprofit leaders say they are bracing for potential targeting by the Trump administration after a controversial tax measure advances in Congress

CNN

time17-05-2025

  • Politics
  • CNN

Nonprofit leaders say they are bracing for potential targeting by the Trump administration after a controversial tax measure advances in Congress

A House measure that would make it easier to yank the tax-exempt status of nonprofits the Trump administration deems as supporting terrorism marks the latest effort by the president and his Republican allies to hobble organizations that oppose his agenda, some nonprofit leaders argue. The provision comes as President Donald Trump has used the powers of his office in extraordinary ways to target top law firms, elite universities and other perceived political enemies. Last month, for instance, Trump directed his Justice Department to launch a probe of ActBlue, the main fundraising platform for Democratic candidates and liberal causes. The language – added this week by the House's tax-writing committee to the massive 'One Big Beautiful Bill Act' that's a top priority for Trump – would allow the Treasury secretary to suspend the tax-exempt status of organizations the administration says are 'terrorist supporting.' More than 200 groups – ranging from the American Library Association to the Sierra Club – recently signed onto a public statement urging the House to remove the provision. They say it's a tool for the president to take aim at his opponents. 'We have seen this administration use every lever of power they have been able to grab to target the people they see as their enemies,' said Cole Leiter, executive director of Americans Against Government Censorship, one of the groups objecting to the House language. 'This is a broad-based weaponization of government, and this is only the latest manifestation of that.' Nonprofit groups fear more is on the way – with a White House deadline looming for government agencies to identify large publicly traded corporations, foundations and nonprofits, universities and state and local bar and medical associations for potential civil investigations. In a statement, a White House official contended that Trump is operating within his rights and the law. 'President Trump will always stand for law and order, ending the weaponization of the legal system, and rooting out fraud in the federal government,' said White House spokesperson Harrison Fields in an email to CNN, echoing the president's familiar refrain that the Biden administration used the judicial system against him when Trump was out of office. 'Every action he has taken in his second term reflects these priorities and is authorized by the Constitution,' Fields said. 'Outside groups that ignored the previous administration's egregious legal abuses against President Trump have no credibility today.' The tax provision, recently added to a nearly 400-page legislative proposal by the GOP-controlled House Ways and Means Committee, hews closely to language in a bill written by New York Republican Rep. Claudia Tenney that the House approved in the last Congressional session but did not pass the Senate. It would allow the Treasury secretary to suspend the tax-exempt status of charities the secretary determines have provided 'material support or resources' to an organization the government has designated as a terrorist organization. Aides to Tenney and Ways and Means Chair Missouri Rep. Jason Smith did not respond to CNN's inquiries about the measure. During floor debate on the Tenney bill last November, Smith said lawmakers have a 'duty to make sure that taxpayers are not subsidizing terrorism.' Groups opposing the measure said it lacks adequate safeguards to protect organizations' due-process rights. Kia Hamadanchy, a senior policy counsel with the ACLU, noted that it already is illegal to provide material support to a terrorist organization. The new provision, Hamadanchy said, is problematic because gives the Treasury secretary exclusive discretion to designate a group as terrorist-supporting and would allow the agency to suspend a nonprofit's tax-exempt status 'before you've had a chance to go before a neutral decision maker like a judge.' Lisa Gilbert – the co-president of the liberal watchdog group Public Citizen – said she fears organizations with international networks could unwittingly become ensnared should the provision become law. 'Think about foreign humanitarian aid, for example, or groups that receive funds from foundations that are not solely based in the United States,' he said. 'There is a lot of activity that could be swept up.' The White House referred questions about the bill's language to the Treasury Department. A Treasury spokesperson declined to comment. The overall bill currently faces a rocky path in the House, although the chamber's Republican leaders have said they want to bring it to the floor for a vote next week. A group of GOP hardliners on Friday blocked its passage in a key committee as they demanded steeper cuts and changes to its Medicaid provisions. If the bill passes the House, organizations opposed to the language regarding nonprofits' tax status say they will fight to kill it in the Senate. The legislation deals with a range of the president's priorities, from tax cuts to immigration enforcement. But to pass it through Congress, where Republicans hold slim majorities in both chambers, GOP leaders are relying on a tool called budget reconciliation – allowing a simple majority to approve it without any Democratic votes. Under strict Senate rules, however, the chamber's parliamentarian must determine whether its provisions have an actual impact on the budget, not merely an 'incidental' one. An early analysis by a congressional joint taxation panel found the provision has a 'negligible' effect in revenue, buoying opponents' hopes that it could be stripped from the larger bill in the Senate. Federal law bars the president from ordering tax investigations of specific people or organizations, but Trump has publicly threatened to revoke the tax-exempt status of Harvard University for refusing to accede to his policy demands. In remarks last month about Harvard's tax status, Trump indicated other organizations could be targeted, and singled out Citizens for Responsibility and Ethics in Washington, or CREW, a nonprofit watchdog group that tackles public corruption and has sued the Trump administration over several of its actions. Some nonprofit leaders now are warily watching for other potential administration moves, arising from executive order that Trump signed January 21, aimed at encouraging the private sector to end what the administration deems as 'illegal discrimination.' Among other things, the order directed agencies to identify up to nine potential targets among foundations, corporations, colleges and other entities, for 'civil compliance' probes as part of the administration's effort to root out diversity, equity, inclusion and accessibility policies. Groups that could be subjected to scrutiny include what the order calls 'large' nonprofits and associations, foundations with assets of at least $500 million and colleges and universities with endowments that top $1 billion. Attorney General Pam Bondi already has directed the department's Civil Rights Division to review whether universities are trying to skirt a 2023 Supreme Court ruling that said schools could no longer take race into consideration as a specific basis for granting admission. A Justice Department task force aimed at combatting antisemitism on campuses is also investigating nearly a dozen universities and the entire University of California system. Trump's Jan. 21 order also calls on the attorney general to issue a report to the White House recommending actions within 120 days – a deadline that will arrive next week. But it's not clear whether lists of potential targets have been assembled or will be released publicly. A DOJ spokesperson did not respond to an inquiry about the report. Even so, leaders of nonprofit groups are having conversations with their lawyers and looking for ways to avoid risks and prepare for potential audits, several people familiar with internal discussions tell CNN. 'People are trying to brace for it,' said Gilbert of Public Citizen. 'It's very unclear what it will mean to be on a list in Trump's America.' CNN's Hannah Rabinowitz contributed to this report.

Law firms, universities, and now civil society groups are in Trump's sights for punitive action
Law firms, universities, and now civil society groups are in Trump's sights for punitive action

Boston Globe

time18-04-2025

  • Politics
  • Boston Globe

Law firms, universities, and now civil society groups are in Trump's sights for punitive action

'It's supposed to be a charitable organization,' Trump said about CREW, in particular. 'The only charity they had is going after Donald Trump. So we're looking at that. We're looking at a lot of things.' Advertisement Trump and his team have been working their way through the nation's institutions, threatening to chisel away at the independence and autonomy of the law firms, college campuses and now advocacy groups — or putting them at risk of losing their federal funds or professional livelihood. Get Starting Point A guide through the most important stories of the morning, delivered Monday through Friday. Enter Email Sign Up It's all coming quickly, not yet 100 days into the new administration, and in ways historically unheard of in this country for their speed and scope. And it's sending shock waves reverberating throughout the American system. 'It's a sad day in this country when organizations that provide critical services to their communities are under attack from their government,' said Cole Leiter, executive director of the advocacy group Americans Against Government Censorship. 'No administration, Republican or Democratic, should be able to weaponize the weight of the government against their political enemies.' Advertisement The list of organizations grows On their own, Trump's actions are an almost daily list of executive pronouncements from the White House. The Trump administration has issued orders against the law firms that had cases or attorneys perceived to be against him, and it has made demands of the universities over their rules around campus activism. Thursday brought potentially more to the stack: Trump singled out CREW, the watchdog group whose founder, Norm Eisen, played a pivotal role in Trump's first impeachment, and the environmental groups that largely stand at odds with his 'drill baby drill' agenda. 'Tax exempt status — I mean, it's a privilege. It's really a privilege, and it's been abused by a lot more than Harvard,' Trump said. 'We'll be making some statements. It's a big deal.' But taken together, the executive orders and actions and memos are making one thing clear: The Trump administration is eager to test new ways to flex executive power, and dare the courts and Congress to intervene. And there's more expected to come. Environmental, immigration and civil society advocacy groups have been bracing for potential threats to their tax-exempt status, according to a person familiar with the situation and granted anonymity to discuss it. The person said some expect Trump might start taking action against the environmental groups on Earth Day, which is Tuesday. These are the largely nonprofit organizations and groups, many based in Washington, advocating for various communities, constituencies and causes. Kieran Suckling, executive director of the Center for Biological Diversity, said environmental groups have heard that the Trump administration is preparing executive orders targeting the tax status of environmental groups that work on climate change, as well as that of any foundations that fund their work. Advertisement 'Trump is marshaling all the power of government to punish his perceived enemies,' Suckling said. 'We've got a crack legal team and will have him in court within 24 hours. We're ready and waiting for him to come at us.' CREW has examined Trump's affairs for years CREW has been a leading ethics group in Washington, with Trump long the subject of its probes. Ahead of the 2024 election, the group was part of the legal effort to disqualify Trump from regaining the White House under the 14th Amendment, in the aftermath of the Jan. 6, 2021, insurrection at the Capitol. More recently, CREW sued over the firing of federal workers by Trump and the Department of Government Efficiency. 'For more than 20 years, CREW has exposed government corruption from politicians of both parties who violate the public trust and has worked to promote an ethical, transparent government,' said Jordan Libowitz, the organization's vice president. Trump's attacks on civil society have created a climate that is potentially chilling for the organizations in question — but they have had mixed results. Five of the major law firms and Trump reached a deal in which they agreed to provide a combined hundreds of millions of dollars in pro bono counsel to causes the administration says it supports. The firms are trying to avoid various sanctions, including terminated federal contracts, federal employment investigations over diversity hiring and others. While Columbia University agreed to the Trump administration's demands to overhaul its rules for public protests rather than risk billions of dollars in lost federal funds, Harvard rebuffed the administration and now faces a $2 billion federal funding freeze and the threat to its tax-exempt status. Advertisement The tax-exempt status allows nonprofit organizations to receive donations that are crucial to their financial bottom line. Changing that could, in some situations, lead to calamity. 'Good governance groups are the heart of a healthy democracy,' Libowitz said. 'We will continue to do our work to ensure Americans have an ethical and accountable government.' Associated Press writers Matthew Daly and Tammy Webber in Fenton, Michigan, contributed to this report.

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