The “Bright Lines Project” began with the noble ambition of defying this axiom by taking the harder course; it was supposed to clear up the hopelessly vague rules that the IRS uses for determining “political intervention,” in which non-profit entities are prohibited or restricted from partaking. The recent IRS scandal, involving the agency’s discrimination against conservative groups applying for non-profit status, has brought to a head the need for serious reform of the tax law’s treatment of political activity.
Unfortunately, the Project, chaired by non-profit tax attorney Gregory L. Colvin, and consisting of seven other prominent members and two contributors, ended up taking the easier route. As demonstrated by its recently released 32-page draft proposal, the Project has failed to live up to its name thus far. Its proposal does little to clarify the IRS’s infamous “facts and circumstances” test and, in some respects, makes matters worse. The proposed rule would continue to regulate the timing, manner, and content of constitutionally protected speech about matters of public importance. Similarly, the proposal would still put the IRS in charge of regulating and making judgments about such speech, despite the inherent dangers in granting it such powers, not to mention the agency’s longstanding incompetence and lack of interest in doing precisely that.
Perhaps the most damning evidence comes from the Project’s own members, who write the following: “We seek a new definition of political intervention that is clear and predictable, most of the time.” A group calling itself the “Bright Lines Project” should not have to hedge about the clarity of its own proposed rule. What’s worse, the proposal they have come up with doesn’t even meet their own qualified standard. In practice, their proposal is likely to be clear and predictable only some of the time.