I don’t mean to minimize the complexity of some of the issues with which the IRS must grapple. Its job is to interpret the current law, not make up policy that might have a particular desirable outcome. Perhaps we’ll find out that the IRS is hard at work on a coherent rethinking of their approach with an eye toward adapting to the modern digital marketplace. Or perhaps Congress will need to create a new 501c category for journalism as it has for railroad retirees, black-lung disease benefit trusts, cemetery companies, and other groups (pdf).
If that’s the case, I hope they’ll consider a few basic points:
First, a solution needs to be found that would enable nonprofit groups to develop sustainable business models.
Second, time is of the essence. Local media systems are in crisis, social entrepreneurs are frantically working to fill the gaps, and the last thing they need is unnecessary delays in setting up shop.
And finally, the future of American journalism will likely depend not only on innovations in the commercial media sector but on the ability of nonprofit media to flourish, too. What the IRS decides to do, in terms of facilitating or hampering these new outlets, will be of historic importance.