Nonprofit organizations throughout New York and across the nation are bracing for potential threats from the Trump administration, including the possibility of having their tax-exempt status revoked. Rumors of investigations into illegal activities or noncompliance with forthcoming executive orders are creating an atmosphere of uncertainty and fear among these groups.
Michelle Jackson, executive director of the Human Services Council, expressed concern over the uncertain nature of upcoming executive orders. “We’ve heard climate and democracy as the focus, and that creates real fear amongst all types of nonprofits,” she said.
As Earth Day approaches, climate-focused nonprofits are particularly anxious about potential executive actions that could target their financial viability. Several environmental groups opted not to comment in response to inquiries regarding this evolving situation.
Historically, the Trump administration has pursued actions against environmental and climate programs. Notably, the administration previously issued an executive order aimed at dismantling programs deemed to fall under the category of ‘Diversity, Equity, and Inclusion’ (DEI), which includes environmental justice initiatives. These initiatives are designed to support heavily impacted communities, particularly those that are often marginalized and economically disadvantaged.
Attorney General Letitia James has stepped in to provide resources and support to nonprofits facing this turmoil. Her office is hosting a webinar next Monday to guide these organizations in navigating any federal changes, with over 1,000 groups registered to attend the event.
Following a recent attempt by a Trump official to prompt a criminal investigation against James for her legal actions against the former president, she addressed the precarious position of nonprofits. “The Trump administration’s threats against nonprofit organizations have had a chilling effect throughout New York and nationwide,” James stated.
She added, “We are already seeing the real impact of these harmful policies. My office is fighting back against these reckless cuts in court, and we are committed to ensuring nonprofits receive the funding necessary to protect the New Yorkers they serve.”
The financial viability of nonprofits has been severely impacted as federal grant money has been canceled or frozen, leading to widespread concern among the sector. State attorneys general, including James, alongside numerous nonprofit organizations, have initiated lawsuits to counteract these federal actions.
In a parallel effort, the American Civil Liberties Union (ACLU) and Public Citizen recently hosted a nationwide virtual briefing for nonprofits. This call, which saw participation from nearly 5,000 attendees, aimed at preparing organizations for potential future attacks while fostering collective responses to defend those at risk.
In the aftermath of this call, a solidarity letter condemning the Trump administration’s treatment of nonprofits was circulated, gaining nearly 600 signatures from various organizations by midday Monday.
The letter labeled Trump’s actions as “reprehensible and dangerous—a violation of a fundamental freedom in America.”
Recent targeting of institutions like Harvard University and the Vera Institute of Justice also raised alarms among nonprofits. Trump threatened to revoke Harvard’s tax-exempt status and a significant amount of research funding over disagreements related to DEI program elimination and restrictions on protest activities.
In response to concerns surrounding tax-exempt status, Trump stated that such privileges have been abused, particularly referencing Harvard’s case as an example.
Tax-exempt status for nonprofits is generally determined at the state level, although the application process occurs through the Internal Revenue Service (IRS). This status not only allows organizations to avoid certain taxes but also enables donors to claim tax deductions. There is fear that the Trump administration may change IRS rules to exclude climate change advocacy from qualifying for nonprofit status.
In New York, charitable nonprofits must maintain a purpose that is charitable, educational, religious, scientific, literary, cultural, or focused on preventing cruelty to children or animals to qualify for tax-exempt designation.
Additionally, nonprofits like the Vera Institute of Justice expressed concern after pseudo-governmental initiatives attempted to monitor their federal funding, indicating that similar actions could extend to all organizations that receive congressional appropriations.
Through social media, the Vera Institute acknowledged their position as targets and warned that they may not be the last.
The Department of Government Efficiency (DOGE) was initially conceived as a mechanism to cut waste and fraud within the federal government. However, its scope has expanded to exert greater control, attempting to place its staff within various nonprofits, including NeighborWorks America, which focuses on affordable housing, and attempting to audit the Metropolitan Transportation Authority in New York.
The effects of federal funding cuts prior to the Trump administration’s tenure were already stressing nonprofits in New York and throughout the country, leading organizations to dissolve and thus diminish services in their communities. Megan Allen, CEO of the New York Council of Nonprofits, pointed out that this federal impact exacerbates preexisting challenges.
“We were stressed as a sector before this,” Allen said. “Every time that happens, that means there are fewer services and support for communities all over.”
As the nonprofit sector faces mounting pressure amid these unprecedented changes, the collective voice against targeted threats continues to grow louder.
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