By Valerie Volcovici and Virginia Furness
WASHINGTON (Reuters) -U.S. non-profit organizations that focus on climate change are getting ready to fight a possible move by the Trump administration to revoke their tax exemptions as soon as this week.
Groups that work on climate change have been circulating memos over the last few days outlining rumored executive actions they expect from President Donald Trump, include a change to IRS rules to remove climate change from qualifying charitable topics and blocking the use of U.S. grants to fund overseas work.
The concern follows comments from Trump taking aim at the charitable status of Harvard University, seen as a potential first shot against other so-called 501(c)3 organizations, named for the part of the tax code that exempts charities from income tax.
The American Civil Liberties Union and Public Citizen held a Zoom call on Friday to discuss how charities can prepare for a possible executive action, according to three leaders of non-profit groups that participated. The call was oversubscribed after the maximum 5,000 people signed in.
Political law firm Sandler Reiff on Friday circulated a memo to its non-profit and philanthropy clients advising them not to panic if the administration attempts to revoke their tax-exempt status or freeze international work.
“The President does not have the ability to unilaterally revoke any organization’s tax exempt status,” the memo, seen by Reuters, said, adding that any executive order that attempts to do that “does not have legal validity”.
Since his January inauguration, Trump has cracked down on top U.S. universities, accusing them of tolerating antisemitism. He has also moved quickly to undo or sidestep environmental regulation, gut climate science research and halt federal support for clean energy.
Trump had said in a social media post last week that he was considering whether to seek to end Harvard’s tax-exempt status.
Environmental groups and grant-making philanthropies have been bracing for some kind of move from the Trump administration to chill their climate work.
Foundations that give to charities say they would fight attempts to limit their giving. The MacArthur Foundation, with around $8 billion, has pledged to spend an additional $150 million in charitable gifts over the next two years.
“We have the ability to do it with more protection and strength than we think,” the Foundation’s President John Palfrey told delegates at a meeting of philanthropic groups in Britain this month. “Drop whatever restrictions we think we can drop. Give gifts wherever we can.”
Lawrence Lessig, a professor at Harvard Law School, said an order attempting to change non profits’ tax status would be on shaky legal ground.
“There is no chance that a court would conclude that Trump has the power to change the tax status of any organization, absent an investigation beginning before Trump targeted the organization, that determined the organization had violated the law,” he said.
(Reporting by Valerie Volcovici and Virginia FurnessEditing by Peter Graff)
Comments