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IRS rule shielding political donors blocked by federal judge

A Trump administration rule permitting many politically active nonprofits to keep their donors a secret has been upended by a federal judge, who says the regulation was written with illegal secrecy.

The IRS decided one year ago to allow so-called 501(c)4 organizations, known as social-welfare groups, to generally keep their contributor lists from the IRS – further accelerating the flow of anonymously donated "dark money" into campaigns. Prominent examples of these organizations are the National Rifle Association, the AARP, Democratic Socialists of America and the Koch brothers' Americans for Prosperity. They are permitted to retain their tax-exempt status so long as they spend less than half their money trying to influence elections.

But a federal trial judge in Montana, Brian Morris, ruled this week that the IRS moved too quickly in its rulemaking and did not give the public a formalize means to weigh in.

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