Update on H.R. 9495

Dear U.S.-Based Members of AFP,

We have received several questions and voices of concern about a federal bill, H.R. 9495, the Stop Terror-Financing and Tax Penalties on American Hostages Act. The U.S. House of Representatives approved the bill on Thursday, November 21, 2024.

The bill includes a provision to provide tax relief to U.S. citizens who are being held hostage as well as a provision authorizing the Treasury to revoke the tax-exempt status of nonprofits accused of supporting terrorism. It was developed on a bipartisan basis and was moving forward without controversy, but post-election everything has changed. Those who fear executive branch action are raising concern that the Treasury would not have to provide full evidence or reasoning. While it is already illegal to provide material support to “terrorist-supporting” organizations, the concern is that this bill gets rid of the existing due process and gives the accused organizations limited time and ability to defend themselves.

Although the bill was approved unanimously at the committee level, the November 21 vote of the full House fell largely, though not entirely, along party lines.

AFP Global joined a diverse group of nearly 300 nonprofit organizations to urge safeguards be incorporated while not opposing the underlying purposes of the bill, i.e. to support those held hostage and to deny support to terrorism. Many of us remember the controversy of Lois Lerner and concerns the IRS was targeting politically aligned groups. The concern with H.R. 9495 is that the decision to remove the tax-exempt status would fall to the Secretary of Treasury, a political position instead of keeping up the firewall with agency experts. 

As a result of Members of Congress hearing from these 300 groups, including AFP, 34 House Members changed their position and voted against the bill. 

AFP has spoken to several key leaders in the Senate who have indicated they do not plan to bring up this bill for the remainder of 2024. So, the likelihood that it will become law this year is slim to none. The bill would need to start from scratch in both chambers in the new year, so there appears to be ample time for it to be improved.  We will watch it closely. AFP will also take a measured, strategic approach to addressing this and other legislative challenges, while focused on the upcoming tax reform debate and prioritizing policies that incentivize more giving by Americans.

If you have any questions, please feel free to reach out to us at paffairs@afpglobal.org. 

Thank you,

Mike Geiger, MBA, CPA
President and CEO, AFP Global