IRS Could Face More Court Battles After Nonprofit Donor Ruling

The IRS may be vulnerable to more court challenges after a federal judge struck down agency guidance that rolled back nonprofit donor disclosure requirements, according to tax professionals.

The ruling upends a position that the Internal Revenue Service and Treasury Department have taken for a long time that guidance falling short of a regulation doesn’t have to go through a full notice-and-comment period, said Kristin Hickman, who for about a year worked as a special adviser in the Office of Management and Budget’s Office of Information and Regulatory Affairs reviewing Treasury’s tax guidance.

The administration in July 2018 revoked ...