In particular, we strongly urge Congress to adopt the proposal that electronic filing for exempt organizations be greatly accelerated and that the form 990 be redesigned to be far more understandable for members of the public. A very substantial amount of information about charities is already available, but it is not as easy to find and use as it should be. Of all the proposals made, we believe this proposal has by far and away the greatest potential to improve the ability to oversee exempt organizations and verify they are serving public and not private purposes. We do, however, take issue with the JCT staff concerning the appropriate analytical framework for evaluating proposals for additional disclosure. We believe that charities disclosure obligations derive from their role in serving public interests, not from their favorable tax treatment.
Many taxable taxpayers receive comparably significant tax benefits.
Charities must operate with a high degree of transparency to ensure the public trust essential to the performance of their social role. But charities are fundamentally private entities and are entitled to a reasonable and substantial zone of privacy with respect to their internal decision-making process. Moreover, in certain key contexts confidentiality is also essential both to assuring efficient tax administration and to avoiding an undue chilling effect on charities participation in the public policy process. We are also concerned that a number of these proposals would impose substantially increased costs to nonprofit organizations. The resources that would be required to comply with these new requirements represent resources that will not be spent providing food, clothing, shelter, medical care, child care and other vital services to the charity s beneficiaries.