To amend the Internal Revenue Code of 1986 to terminate the tax-exempt status of terrorist supporting organizations.
Summary
This bill, S. 3554, aims to amend the Internal Revenue Code of 1986 by terminating the tax-exempt status of organizations found to be supporting terrorist activities. It grants the Secretary of the Treasury the authority to designate such organizations after providing them with notice and an opportunity to contest the designation. The bill also establishes procedures for rescinding designations and provides for administrative and judicial review.
Expected Effects
The bill would likely result in increased scrutiny of tax-exempt organizations and potentially reduce the flow of financial support to terrorist groups. Organizations designated as terrorist supporting would lose their tax-exempt status, making it more difficult for them to operate and raise funds. This could also deter other organizations from providing material support to designated terrorist groups.
Potential Benefits
- Reduces financial support for terrorist organizations.
- Enhances national security by disrupting terrorist financing networks.
- Provides a legal framework for designating and penalizing terrorist supporting organizations.
- Offers due process protections through notice and appeal procedures.
- Increases transparency and accountability of tax-exempt organizations.
Potential Disadvantages
- Potential for misidentification or erroneous designation of organizations.
- Risk of chilling legitimate charitable activities due to fear of designation.
- Increased administrative burden on the IRS and the Department of the Treasury.
- Possible legal challenges from organizations contesting their designation.
- Could be used to target organizations based on political grounds.
Constitutional Alignment
The bill's alignment with the US Constitution is complex. While it aims to enhance national security, which is a legitimate government interest, it also raises concerns about due process and freedom of association under the First and Fifth Amendments. The bill includes provisions for notice and judicial review, which mitigate some of these concerns. However, the use of classified information in designation decisions could potentially infringe on due process rights if not handled carefully, as outlined in Article III regarding judicial power.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).