Senate Bill Would Allow Tax-Exempt Status for Newspapers

Editor and Publisher ^ | March 24, 2009 1:08 PM ET | Mark Fitzgerald

[Red Steel]

CHICAGO Newspapers perform a public service for democracy and should be allowed to operate as tax-exempt non-profits, U.S. Sen. Benjamin Cardin, D.-Md., proposed Tuesday.

Cardin introduced a bill that would explicitly include newspapers among organizations eligible for 501(c)(3) status. The non-profit status is the same that public radio and television have now.

The legislation would give a national green light for newspapers to adopt the so-called Low Profit Limited Liability Company business model, often shortened to L3C.

The L3C model, which the Newspaper Guild supports as an alternative newspaper ownership model, is the subject of a feature story in the current print issue of Editor & Publisher.

Under Cardin's legislation, newspaper revenue would be tax-exempt, and contributions to papers would be tax deductible. The status would also allow non-profits to invest in newspapers, something that is forbidden now.

Cardin said action is needed to help preserve local newspapers.

"We are losing our newspaper industry," Cardin said in a statement. "The economy has caused an immediate problem, but the business model for newspapers, based on circulation and advertising revenue, is broken, and that is a real tragedy for communities across the nation and for our democracy."

The Associated Press quoted him as saying on the Senate floor, "As local papers are closing, we're losing a valuable tradition in America -- critically important to our communities, critically important to our democracy."

Newspapers that accept non-profit status would not be allowed to endorse candidates, but they could cover political news just as they do now, Cardin said.

[GOPJ]

Bye-bye free press.

[VeniVidiVici]

Newspapers that accept non-profit status would not be allowed to endorse candidates, but they could cover political news just as they do now, Cardin said.

What...a.....moron.

[Tunehead54]

Tax exempt status plus the mentioned tax deductable donation situation would essentially make them 'Rat political donation tools. You wouldn't have to donate directly to any given 'Rat for their election and the donation wouldn't fall under reporting requirements but the 'Rat candidate local the the donation receiver would receive a lot of "favorable political reporting".

---

Exactly. Political donations are not deductible but unlimited contributions to newspapers would be deductible and conceivably turn the paper into a 7 day political advertisement for the donor's political inclinations. We must fight against this. :-(