Independent Sector announced the formation of an eight-member Expert Advisory Group that will advise the "Panel on the Nonprofit Sector" formed in response to a request by the Finance Committee to make recommendations to Congress to improve the oversight and governance of charitable organizations. The Expert Advisory Group will provide knowledge and support to the Panel on such issues as government regulation, financial accountability, and tax policy. They will also provide perspective on recommendations from the working groups that will also support the panel.

On Oct. 13, the Treasury Department designated the Islamic American Relief Agency (IARA), along with five senior officials, as supporters of terrorism. This action froze all accounts, funds and assets of IARA in the United States and criminalizes the provision or donation of money to any of its offices. IARA has no right to appeal or learn of the evidence against it. This effectively allows the government to treat organizations as guilty without the opportunity to demonstrate innocence.

On Oct. 28 the National Association for the Advancement of Colored People (NAACP) announced that the Internal Revenue Service (IRS) is investigating their tax-exempt status because Chairman Julian Bond criticized the Bush administration's policies in his speech to the group's July convention. The NAACP is a 501(c)(3) organization, and as such is barred from intervening in elections. The nation's oldest and largest civil rights organization questioned the timing of the IRS action, calling it a politically motivated attempt to silence the organization and discourage blacks from voting.