Because any demand by the government for a nonprofit’s donor list is dangerous, the Supreme Court requires such mandated disclosures to survive the First Amendment’s exacting scrutiny, a heightened form of judicial review. In July, we filed a lawsuit against the IRS’s demand that all 501(c)(3) non-profit organizations provide lists of all substantial donors on their Form 990 Schedule B. National Taxpayers Union Foundation’s Taxpayer Defense Center represents Young America’s Foundation (YAF), a 501(c)(3) nonprofit organization that has to file Schedule B every year.
On October 14, 2026, the federal government filed a motion to dismiss the case. Fourteen days later, on October 28, 2026, we filed a brief opposing the motion to dismiss and arguing the case must press onward to protect important First Amendment rights.
The government argues the donor list demand need only survive a more deferential standard, rational basis review. It argues Schedule B is not about disclosure but instead a requirement for qualifying for a “double subsidy” tax benefit. But the government’s argument was rejected in Americans for Prosperity Foundation v. Bonta and the Civil Rights era cases, which were reaffirmed just five months ago in First Choice Women’s Resource Centers, Inc. v. Davenport. We argue that the proper form of judicial review is exacting scrutiny any time the government demands a list of members and supporters of a nonprofit organization.
Under exacting scrutiny, the IRS needs to prove that its collection of a nonprofit’s donor data is actually used to enforce the relevant tax laws and is narrowly tailored to gather only the information it needs. The IRS cannot meet this high bar, and it is the government that bears the burden to satisfy exacting scrutiny. The IRS does not regularly use the information on Schedule B and there are many less intrusive alternatives to the universal collection of donor lists from all § 501(c)(3) organizations like YAF.
The danger of the government warehousing such information is very real. In 2024, the IRS sent YAF a letter to acknowledge that former IRS contractor Charles Littlejohn had leaked information on YAF’s past tax returns. Littlejohn, now serving prison time for his crime, had leaked some 78,000 tax returns and exposed the private information of 400,000 Americans, putting them at risk of doxxing and political violence. The Biden Administration sought just a single count of violating the privacy laws, surprising the judge reviewing the case and undermining the argument that the government is interested in protecting donor data.
What the IRS wants here is a classic unconstitutional condition. And groups like YAF cannot simply fail to register as § 501(c)(3) organizations, because state law is premised on nonprofits being in the right category based on their IRS tax designation.
None of the government’s arguments hold out against the real danger of the donor list demands placed on the First Amendment rights of nonprofits. We therefore urge the court to deny the government’s motion to dismiss and allow the case to continue to proceed.
The case is Young America’s Foundation v. IRS, et al. It is filed in the United States District Court for the District of Columbia, No. 1:26-cv-02449-TNM. Stay tuned for further developments. You can find more information about the case and its background here.