Federal Judge Overturns IRS Rule To Shield Political Donor Identities

For all that has been, Thank you. For all that is to come, Yes!

— Dag Hammarskjold, born in 1905

Wage theft now a problem for high-skilled workers

Democracy is in crisis! Or so warns a gaggle of alarmist books — all of which seem to poorly grasp how democracy actually works... Webdiary 

Wall Street Journal op-ed:  In a Life-or-Death Crisis, Humility Is Everything, by Sam Walker(author, The Captain Class: The Hidden Force That Creates the World’s Greatest Teams(2018)):  

Many of history’s most-celebrated leaders displayed a remarkable mix of courage and humility. But on the short list of leaders who’ve saved lives in the face of overwhelming odds [GM CEO Mary Barra, Johnson & Johnson CEO James Burke, United pilot Alfred Haynes, US Air pilot Chesley Sullenberger, Chilean miner Luis Urzúa], those two traits are nearly universal.

The reason, I suspect, is that they’re inextricably linked.

Few business leaders ever find themselves in the kind of fix where many lives hang in the balance. When they do, however, history suggests that a little humility can go a long way. ...

Humility isn’t a byproduct of heroism, it’s a precondition. Modest people achieve miracles under pressure because they’re far more likely to possess four major qualities that pay dividends in a crisis.

Bloomberg, Judge Overturns IRS Rule to Shield Political Donor Identities: 

A federal judge in Montana overturned an Internal Revenue Service rule that would allow many political non-profit groups to keep their donor lists private [Bullock v. Rettig, No. CV-18-103-GF-BMM (D. MT July 30, 2019).

The ruling upends a change the IRS made last year that permitted so-called Section 501(c)4 groups, known as “social-welfare” organizations, to keep their donor lists private. A federal judge said the IRS didn’t follow proper procedure in writing the rule and needs to allow the public to weigh in on the change before altering the tax code.

“Then, and only then, may the IRS act on a fully informed basis when making potentially significant changes to federal tax law,” U.S. federal Judge Brian Morris said in the opinion published Tuesday evening. ...

The ruling is a blow to Treasury Secretary Steven Mnuchin who touted the rule, saying it protected donor privacy because the IRS didn’t need the information to enforce tax laws. Democrats had criticized the agency’s move, saying it opened up the possibility for foreign interests to influence elections.

Update:  Bloomberg Tax, IRS Could Face More Court Battles After Nonprofit Donor Ruling:

The IRS may be vulnerable to more court challenges after a federal judge struck down agency guidance that rolled back nonprofit donor disclosure requirements, according to tax professionals.

The ruling upends a position that the Internal Revenue Service and Treasury Department have taken for a long time that guidance falling short of a regulation doesn’t have to go through a full notice-and-comment period, said Kristin Hickman. ...

“The fact that the judge declared a revenue procedure to be a legislative rule is a big deal,” said Hickman, a professor at the University of Minnesota Law School who specializes in tax administration and administrative law.

The decision could subject other revenue procedures—or revenue rulings—to challenges from taxpayers if Morris’s ruling stands, said Lloyd Hitoshi Mayer, a professor at University of Notre Dame Law School. This, however, may not work in every case. The fact that the donor disclosure change amended a nearly 50-year-old rule seemed to play a large role in the judge’s decision, Mayer said.

For background of the case, see:

• Daniel Hemel (Chicago), Montana vs. the Koch Brothers
• New York Times, Montana Governor Sues I.R.S., Warning of ‘Foreign Money’ in Elections

The Australian, 6 August 2019. A Harvard Business Review study ranks Australia in ninth position among world leaders in the data economy, using the criteria of broadband consumption, active internet users, accessibility and complexity.

GLENCORE’S TAX BILL

Leaked Paradise Papers documents, which come mostly from the offshore law firm Appleby, are fair game when it comes to assessing Glencore’s tax bill in Australia. That was the ruling from the Australian High Court last week. Glencore argued “legal privilege” – which usually exempts lawyer-client communications from being used in evidence – should protect the commodity giant. Not in this case. Jeremy Hirschhorn, from the Australian Taxation Office, said “taxpayers are only one data leak away from their entire affairs being exposed” in the wake of the decision.

ISOLATION IS RISING

New data, which builds on the records we used for Solitary Voices, reveals the use of solitary confinement in United States immigration centers is on the rise. Of the 6,000 plus records, some 40% of the incidents involved a detainee with mental health issues. The data covers a period of more than two years and revealed the overall use of isolation was on the rise. 

PANAMA PAPERS CASE

The first criminal case relating to the Panama Papers is set for trial in January next year – nearly four years after we first published the investigation. We’ve been keeping up with all the legal arguments, and plan to follow it until the end of the trial. In the latest installment, the Department of Justice has gone head-to-head with defense lawyers about whether leaked material published by ICIJ’s media partners should be protected by attorney-client privilege.

PUBLICATION POWER

Journalists are feeling re-empowered to take on the world’s powerful, according to our Danish member and author Brigitte Alfter. Despite being taught to fight for exclusives, Brigitte tells us that reporters are collaborating on levels that have never been done before - in a variety of new ways. “We’re about to surmount a lot of different borders!” she says.