Judge Blocks IRS Rule to Halt Nonprofit Donor Disclosures

HELENA, Mont. (AP) -
Montana Gov. Steve Bullock participates in the first of two Democratic presidential primary debates hosted by CNN, July 30, 2019, in the Fox Theatre in Detroit. (AP Photo/Paul Sancya)

A Montana judge has blocked a Trump administration policy change that stopped nonprofit groups from identifying their big donors on federal disclosure forms.

U.S. District Judge Brian Morris ruled Tuesday that the IRS didn’t give proper public notice before it stopped requiring social-welfare groups, labor unions and business associations to identify donors contributing more than $5,000.

Morris says the IRS changed the 40-year-old rule last year without an opportunity for public comment.

He suspended the rule change until the tax agency allows public comment.

Montana Gov. Steve Bullock and New Jersey Attorney General Gurbir Grewal sued over the change.

The Democrats say keeping donor identities secret makes it easier for foreign money to influence U.S. elections.

IRS lawyers argued unsuccessfully that the states can’t challenge federal tax policy.