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House Ways and Means Panel Examines Tax-Exempt Organizations

May 18, 2012—The House Ways and Means Oversight Subcommittee May 16 held the first in a series of hearings to examine the tax-exempt sector and Internal Revenue Service (IRS) oversight. The hearing focused on the current IRS compliance initiative related to universities, the new community health needs assessment for tax-exempt hospitals, recent efforts by tax-exempt organizations to implement good governance standards, and redesigning Form 990.

Subcommittee Chair Charles Boustany, M.D., (R-La.) announced the purpose of the hearing as “to ensure that the tax-exempt sector is operating in an efficient manner and that the laws governing tax-exempt organizations are being applied fairly and evenly.” Five witnesses from hospitals and universities had the opportunity to testify, but additional institutions may submit a written statement for the record before close of business on May 30.

Michael Regier, senior vice president of legal and corporate affairs, VHA Inc., and Bruce R. Hopkins, senior partner, Polsinelli Shughart, both testified about the development of law on tax-exempt organizations. In his testimony, Mr. Regier stated that the committee should avoid taking action to jeopardize the core benefits of non-profits: income tax exemption for charitable hospitals, tax-exempt financing for hospital facilities, and deductibility of charitable contributions and bequests for hospital donors.

Roger Colinvaux, associate professor at Columbus School of Law, The Catholic University of America, offered what he termed a “descriptive account in an effort to better understand the development of the law, and its increasing complexity.” Diana Aviv, president and chief executive officer, Independent Sector, urged the committee to enact the expired tax extenders and noted more could be done to encourage electronic filing of Form 990.  Joanne M. DeStefano, vice president for finance and chief financial officer, Cornell University, testified on behalf of the National Association of College and University Business Officers (NACUBO). She discussed Cornell’s 2008 Forms 990 and 990T audit and encouraged the IRS to “eliminate the proposed requirement that income on the 990 be reported based on [Schedule K-1].”


Peters Willson
Sr. Specialist, Policy and Constituency Issues
Telephone: 202-862-6029

Ivy Baer, J.D., M.P.H.
Senior Director and Regulatory Counsel
Telephone: 202-828-0499

Matthew Shick, JD
Director, Gov't Relations & Regulatory Affairs
Telephone: 202-862-6116


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Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.

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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806