Kansas Republican Sen. Pat Roberts introduced a bill Friday aimed at stopping an IRS voluntary rule requiring nonprofit organizations to report the Social Security numbers of donors giving over $250 to non-profit organizations.
Critics of the rule fear it will inhibit people from donating to charities in fear of being put at greater risk of identity theft and potentially political retribution.
A data breach at the Office of Personnel Management More exposing than 20 million federal employees and contractors’ personal information has left many wondering if the regulation will lead to their information being vulnerable.
“Given that the agency has not yet adequately addressed the issues surrounding breaches of existing taxpayer information, a point the IRS readily acknowledges, and states that the existing system of substantiating charitable contributions works well, there is no compelling tax administration or enforcement reason to move forward with this proposal,” Roberts said in a statement.
The bill would keep current law in tact, leaving the responsibility to provide information about a contribution to the donor.
The Maryland Citizen Action Network, an Annapolis-based conservative-leaning nonprofit, is concerned if the rule is implemented it will create a financial strain on 501(c)(3) and 501(c)(4) organizations and could make it easier for the IRS to target certain groups for audits based on their political leanings.
“This sets up these organizations for a huge burdensome task of having to store social security numbers, your social security numbers, putting not only those organization at risk for a financial burden for storing them properly but your information is susceptible to identity theft,” Tonya Tiffany, the group’s president, said in a video released in early December.
Roberts argued the rule does exactly the opposite of what it sets out to accomplish.
“This rule is ridiculous. If the intent is to crack down on fraud, the IRS should not create rules that will add to the problem,” the Kansas Republican said. “They have already proven that the IRS itself can’t safeguard personal and private information from abuse.”
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