IRS mulls rule forcing charities to reveal leaders' fraud or terrorism convictions

Sources familiar with the plan say the IRS intends to insert a disclosure requirement into Form 990, asking charities to note whether any officer, director or trustee has been convicted of offenses ranging from providing material support to terrorists to various financial crimes, limited to convictions in the past ten years. The administration argues the change will help donors make informed choices and allow the IRS to act more quickly against nonprofits that hide such information.

Critics inside the agency and legal scholars contend the rule could amount to guilt by association and may conflict with recent Supreme Court precedent on donor privacy. Treasury officials stress the move is part of broader efforts to curb misuse of tax-exempt status, while opponents view it as political targeting of groups opposed to the administration. The proposal is still under review and has not been finalized.