NASHVILLE -- The Internal Revenue Service is going back to the drawing board on its disputed rules for politically active tax-exempt groups, prompting U.S. Sen. Lamar Alexander to declare the "American people have successfully pushed back" against the proposal.
U.S. Treasury and IRS officials said in a statement Thursday they will take a new look at proposed regulations for the controversial 501(c)(4) groups after the initial proposal generated more than 150,000 comment. It was the most comments ever received on a tax regulation, the IRS said.
"The American people have successfully pushed back against the IRS's attempts to keep them from speaking up and speaking out, and they've done that in the best way possible - by speaking up and speaking out," Alexander said in a news release.
He said that in 2012 the IRS "violated the First Amendment rights of Americans when it created what amounted to an enemies list of conservatives - including Tennessee Tea Party groups - to keep people quiet, but it hasn't worked."
Chattanooga Tea Party President Mark West said last year the group was among 75 groups whose tax-exempt status was delayed, charging it amounted to the "heavy-handedness of a bureaucratic government agency that has gone awry."