US House Passes Bill That Would Let Administration Strip Any Nonprofit As “Terrorist-Supporting”

Editor’s Note: This article will continue to be updated as more news about HR 9495 is released.

A bill, HR 9495, which would allow a presidentially appointed treasury secretary to unilaterally strip a nonprofit of its status if deemed a “terrorism-supporting” organization, has passed in the US House of Representatives.

The bill passed 219-184, mostly along partisan lines, with Republicans in support and Democrats opposing; 15 Democrats broke with their caucus to vote in favor of the bill.

The measure, formally named the Stop Terror-Financing and Tax Penalties on American Hostages Act, has raised alarm across the nonprofit sector and US civil society, and a multitude of organizations—from civil rights groups to nonprofit media to advocacy and direct service groups—have mobilized against the bill.

The measure has raised alarm across the nonprofit sector and US civil society.

An earlier version of the bill was introduced with bipartisan support amid widespread campus protests over the war in Gaza, with at least the implication that some groups supporting or organizing those protests were also (or therefore) supporting “terrorism.”

That assumption alone would be enough to spark fears of political retribution by any president, via the secretary of the treasury, against disfavored nonprofit groups.

But the stakes of the bill were raised when Donald J. Trump won reelection this month.

Those mobilizing against the measure fear that Trump, who has publicly broadcast his interest and willingness to punish his perceived political opponents, will use the bill to target and silence any organization he disagrees with.

Those mobilizing against the measure fear that Trump…will use the bill to target and silence any organization he disagrees with.

This September, the ACLU and some 150 organizations cosigned a letter opposing the legislation, expressing “deep concerns about the bill’s potential to grant the executive branch extraordinary power to investigate, harass, and effectively dismantle any nonprofit organization—including news outlets, universities, and civil liberties organizations like ours—by stripping them of their tax-exempt status based on a unilateral accusation of wrongdoing.”

Last week, the Council on Foundations, Independent Sector, National Council of Nonprofits, and United Philanthropy Forum penned another letter, stating:

This legislation would allow the Secretary of the Treasury to designate section 501(c) nonprofits as “terrorist supporting organizations” at the Secretary’s discretion, without requiring the Secretary to share their full evidence or reasoning with accused nonprofits. Furthermore, the legislation runs counter to constitutional due process protections by placing the burden of proof on the accused organization and providing only 90 days for organizations to demonstrate their innocence before revoking their tax-exempt status.

The bill failed an earlier House vote last week, when supporters failed to rally a two-thirds vote required for procedural reasons, with 52 Democrats breaking with their caucus to vote in favor. The House vote today, however, required only a simple majority to pass.

Speaking on the House floor Thursday, Democrat opponents of the bill warned that it could be weaponized by Trump and his administration to target political enemies and perceived opposition to the incoming president’s agenda.

Describing the bill as a “death penalty for nonprofits,” Rep. Lloyd Doggett (D-TX) said that rather than protecting Americans, the measure would allow President-elect Donald Trump to “use it as a sword against those he views as his political enemies.…If this bill were to become law we would hand him a bludgeon for a crusade against those he deems the greatest danger to America, what he calls ‘the enemy within’.”

“It is not just Trump imposing a death sentence that should concern us but it is his power to intimidate,” said Doggett. “Clearly the bill would have a chilling effect on any group that has the audacity to challenge his chilling vision.”

Rep. Pramila Jayapal (D-WA), who chairs the Democratic Progressive Caucus, called the bill “an authoritarian play by Republicans to expand the sweeping powers of the executive branch to go after political enemies and stifle political dissent.”

Rep. Rashida Tlaib (D-MI) called the measure “a dangerous and unconstitutional bill that would allow unchecked power to target nonprofit organizations as political enemies and shut them down without due process.”

The bill now advances from the Republican-controlled House to the Senate, where its fate is uncertain.

Republican members dismissed such objections. Noting previous bipartisan support for the bill, House Ways and Means Chair Jason Smith (R-MO) blasted his colleagues across the aisle for voting against the measure.

“Despite that consistent bipartisan support,” Smith said, “the majority of our Democrat colleagues voted last week to block passage of this bill. Why?…Because President Trump won the election.”

“They now believe the authorities in this bill might be abused,” said Smith. “But every concern raised by Democrats has been addressed in this bill to ensure due process and to protect legitimate nonprofits.”

The bill now advances from the Republican-controlled House to the Senate, where its fate is uncertain—but where it very well may be defeated by Democratic senators, who still hold a slim majority.

Regardless, groups following the legislation warn that the bill is likely to return, at least in some form, in 2025—under a Republican-controlled Congress and President Donald Trump.