IRS
SEE TWO
SOME BAD FORMAT HERE, SEE BAK 4 22
IRS audit used with wild abandon by nixon admin (we have it on tape?)
leverage?
Has never been used since (lbj?) but a sort of nuclear option is to go after tax exempt status of enemy Chamberwatch?
GOP esp House incapable of governing (passing bills is in itself evil"?) so fake action by continually re-ginning up IRS Lerner and Benghazi (after failing to repeal obamacare 40X plus times) 6/14 hard drive lost in 2011?
irs also tool of moderation vs inequality
see also revenue cda: harper used ~ green groups, suziki (combine al gore and mann)
==
CMD nuke option IRS on daily caller FDN?
http://dailycaller.com/2016/08/01/new-fbi-docs-show-irs-tea-party-applications-to-black-hole/
===
http://www.thedailybeast.com/articles/2015/06/23/group-that-fueled-dylann-roof-s-hate-is-subsidized-by-u-s-taxpayers.html
CPI
BLOOD MONEY 06.23.15
Group That Fueled Dylann Roof’s Hate Is Subsidized by U.S. Taxpayers
The outfit that inspired Charleston’s alleged terrorist is listed by the IRS as an organization to ‘primarily promote the common good’—and therefore pays no taxes.
By David Heath and Carrie Levine,Center for Public Integrity
Alleged Charleston gunman Dylann Roof wrote that he was never the same after discovering a website with “pages upon pages of these brutal black on white murders.”
The pages that left Roof in disbelief were the product of a white-nationalist group subsidized by American taxpayers.
The Council of Conservative Citizens Inc.is listed by the Internal Revenue Service as a nonprofit organization that promotes social welfare, also known as a 501(c)(4). Such groups pay no federal taxes, a form of government subsidy. As the Government Accountability Office, Congress’s investigative arm, noted,tax exemptions “have the same effect as Government payments to favored taxpayers.”
The council is now under fire for allegedly inspiring racial hatred in Roof, a 21-year-old high school dropout. He is charged with nine counts of murder.
Tax-exempt social welfare groups are supposed to “primarily promote the common good and general welfare of the people of the community as a whole,” according to IRS documents.
The Council of Conservative Citizens explains on its website that its members believe “that the American people and government should remain European in their composition and character…. We also oppose all efforts to mix the races of mankind.”
Groups that espouse hate can be stripped of their tax-exempt status, said Marcus Owens, who ran the IRS’s exempt organizations division in the 1990s. That happened to the neo-Nazi group National Alliance in 1982. The Council of Conservative Citizens has been identified by the Southern Poverty Law Center as a “notorious, racist hate group.”
However, Owens says Republicans in Congress have made it virtually impossible for the IRS to revoke the tax-exempt status of political groups after the recent, so-called Tea Party scandal. Republicans criticized the IRS for what they said was inexcusable targeting of conservative 501(c)(4)s. And the Treasury Inspector General for Tax Administration said the agency had employed “inappropriate criteria” in scrutinizing some groups’ tax-exemption applications.
The Council of Conservative Citizens has hadtax-exempt status since 1985. In its most recent tax filing in 2013, the group reported revenues of $67,000.
Owens said the small amounts of money involved may also deter the IRS from taking action.
“The ability of the IRS to deal with organizations that are not a significant revenue drain is very limited these days,” he said.
A spokesman for the IRS did not respond to requests for comment.
The Council of Conservative Citizens said in a statement that it “unequivocally condemns Roof’s murderous actions.” Its spokesperson, Jared Taylor, said, “I think it would be a big mistake to say that he was inspired (by the group’s website.) He was informed.”
Taylor said the group is not racist, does not promote hate, and educates the public about a variety of issues. One of those issues is black-on-white crime. Roof allegedly told the black victims in the church, “You rape our women.”
==
6/16
heritage intern on daily s: big pix in flattering of lerner, tho gone
NB: dark $ depends on IRS status? benghazi like perpetuation of persecution myth: note email spin:
Legislation that would prevent the Internal Revenue Service from requiring tax-exempt organizations to include the names, addresses, or identifying information of donors in yearly returns could end up on President Barack Obama’s desk.
The House passed the bill, introduced by Rep. Peter Roskam, R-Ill., by a vote of :{240-182:(style="font-weight:400"):}:.
The White House Office of Management and Budget :{said:(style="font-weight:400"):}:the Obama administration opposes the House legislation. The bill “would constrain the Internal Revenue Service’s ability to enforce tax laws and reduce transparency,” it said.
House votes to stop IRS from collecting info ofnonprofit donors – https://t.co/46w7GZhPSM – @WashTimes
— Peter Roskam (@PeterRoskam) June 14, 2016
“We voted to eliminate a confidential form theIRS proved incapable of securing,” Roskam said in a prepared statement after the legislation passed June 14. “The agency has said it doesn’t even need this form for tax administration in the first place.”
Currently, 501(c)(3) and 501(c)(4) nonprofits must provide donor names and addresses to the IRS on Form B of their annual Form 990 information :{returns:(style="font-weight:400"):}:. These tax-exempt organizations must disclose the identities and other information for donors who contribute more than :{$5,000:(style="font-weight:400"):}:.
The :{Conservative Action Project:(style="font-weight:400"):}:, comprised of leaders at over 100 organizations working toward common goals within the conservative movement, recently issued a memo calling for a curtailment of IRS power.
Chairwoman of the group is Becky Norton Dunlop,a former White House adviser to President Ronald Reagan who is The Heritage Foundation’s longtime vice president for external relations and currently the think tank’s Ronald Reagan distinguished fellow.
“The IRS itself has conceded that it has great difficulty maintaining the statutory confidentiality of donors’ identity,” the Conservative Action Group’s :{memo:(style="font-weight:400"):}: says, adding:
Many believe that compelling the disclosure of donor information violates the contributors’ and [tax-]exempt organizations’ First Amendment rights to freedom of association and that Congress should prohibit the continued collection by the IRS of this sensitive information.
>>> Conservatives Impatient With House Leadership on Impeaching IRS Chief
Roskam’s bill, :{H.R. 5053:(style="font-weight:400"):}:, was titled the “Preventing IRS Abuse and Protecting Free Speech Act.”
The memo, signed by over 70 conservative leaders, called for support of Roskam’s legislation:
In 2013, senior IRS official Lois Lerner admitted that organizations were targeted because of their titles or beliefs, but claimed that the practice was ‘absolutely incorrect,insensitive, and inappropriate.’
H.R. 5053 will assist the IRS in doing its job: If the IRS doesn’t have information about donors to 501(c) organizations, it can’t release it, by mistake, or by direction of a successor to Lois Lerner—one of whom might, soon, be a Republican.
The Senate Committee on Finance released a report last fall that claims the IRS :{mishandled:(style="font-weight:400"):}:tea party and conservative groups’ applications for tax-exempt status, but Lerner, former director of the agency’s Exempt Organizations Division, was not charged by the Department of Justice.
The current IRS commissioner, John Koskinen, is also under :{threat of impeachment:(style="font-weight:400"):}: by the House Judiciary Committee for :{failing to produce documents:(style="font-weight:400"):}: in relation to the Lerner scandal.
“When the IRS scandal broke, Congress demanded answers from the agency’s top officials. Were they targeting groups for their religious and political beliefs?” House Speaker Paul Ryan, R-Wis., :{wrote :(style="font-weight:400"):}:in an op-ed for TheDaily Signal. “No, they said, it was just a few rogue employees in Ohio—if anything at all. Well, what happened to Lois Lerner’s emails? Oh, they were lost in a tragic hard drive crash.”
J. Russell George, the Treasury Department’s inspector general, testified before the House Oversight and Government Reform Committee, telling lawmakers that IRS employees erased 422 backup tapes that housed 24,000 emailssent to and from Lerner. The erasure came a month after IRS officials had been told the emails were missing due to a hard drive crash, The Daily Signal previously reported.
One of the signatories on the Conservative Action Project memo, Jenny Beth Martin, co-founder and president of Tea Party Patriots, released the following :{statement:(style="font-weight:400"):}::
In our republic, it is the government that needs to be transparent about the ways it exercises its enormous power, and the American people are guaranteed privacy and the freedom to associate in the Bill of Rights. On behalf of our over 2 million supporters I want to sincerely thank the House of Representatives for taking action on this important issue to help protect and expand the First Amendment and I call on the U.S. Senate to join the House in passing this bill so it can be sent to the president’s desk as soon as possible.
Sen. Tim Scott, R-S.C., introduced on June 15 a :{companion bill:(style="font-weight:400"):}: to the legislation passed in the House. Scott’s legislation was referred to the Senate :{Committee on Finance:(style="font-weight:400"):}:.
“The IRS’ targeting of groups based on their political beliefs is totally unacceptable, and we must take concrete steps to ensure it never happens again,” Scott said in a prepared :{statement:(style="font-weight:400"):}:.
The Daily Signal:{ depends on the support of readers like you:{ [link to HERITAGE.ORG]}:
}:==
roskam bill endorse: CAP? "memo":
H.R. 5053 will assist the IRS in doing its job: If the IRS doesn't have information
about donors to 501(c) organizations, it can't release it, by mistake, or by direction of a
successor to Lois Lerner . one of whom might, soon, be a Republican.
The IRS would continue to be able to obtain specific financial information, including
donor identity and contribution histories and information, as part of any audit or
enforcement action involving specific taxpayers; but that would be within a different IRS
procedure and would be unaffected by the passage of H. R. 5053.
The Conservative Action Project urges all conservatives and conservative
organizations . and all other Americans as well . to urge their representative in
Washington to support H.R. 5053. Ronald Reagan was right in 1981. And thirty]five years
later, government is still the problem.
The Honorable Edwin Meese III
Former Attorney General
President Ronald Reagan
:{The Honorable Becky Norton Dunlop
Chairman, Conservative Action Project}:
Former White House Advisor
President Ronald Reagan
L. Brent Bozell, III
Founder & President
Media Research Center
The Honorable Bob McEwen
U.S. House of Representatives
:{Former Member, Ohio
Cleta Mitchell}:
Attorney
Washington, DC
David Bozell
President
ForAmerica
The Honorable T. Kenneth Cribb, Jr.
Former Domestic Advisor
President Ronald Reagan
The Honorable David McIntosh
President
Club for Growth
The Honorable Tony Perkins
President
Family Research Council
Jenny Beth Martin
Co]Founder & President
Tea Party Patriots
Adam Brandon
President
FreedomWorks
David N. Bossie
President
Citizens United
Gary L. Bauer
President
American Values
James C. Dobson, Ph.D.
Founder and President
Family Talk
4
Diana L. Banister
President
Shirley & Banister Public Affairs
Luke Hilgemann
CEO
Americans for Prosperity
Jason Jones
President
Movie to Movement
Rod D. Martin
Founder and CEO
The Martin Organization, Inc.
Sherri R. Martin
Co]Founder
The Martin Foundation
Monty S. Warner
Plains States Legal Foundation
The Honorable Jerry Melvin
President
Florida Republican Assembly
Nicholas Stehle
Campaign for the American Future
Anthony Allen
President
Hannibal]LaGrange University
Mathew D. Staver, Esq.
Founder and Chairman
Liberty Counsel
Tom DeLay
Former Majority Leader
US House of Representatives
Kelly Shackelford, Esq.
President, CEO & Chief Counsel
First Liberty Institute
Andrea Lafferty
President
Traditional Values Coalition
Rev. Louis P. Sheldon
Founder and Chairman
Traditional Values Coalition
Norm Singleton
President
Campaign for Liberty
Mario H. Lopez
President
Hispanic Leadership Fund
:{Ali Akbar
Senior Advisor
Black Conservatives Fund}:
Mark J. Fitzgibbons
President of Corporate Affairs
American Target Advertising, Inc.
:{Phil Kerpen
President
American Commitment}:
Susan Carleson
President
American Civil Rights Union
The Honorable Belden Bell
Trustee
The Heritage Foundation
Andresen Blom
Executive Director
Grassroot Hawaii Action, Inc.
:{Dan Backer, Esq.
DB Capitol Strategies PLLC}:
The Honorable Mike Hill
State Representative
District 2
5
Allen J. Hebert
Chairman, American]Chinese
Fellowship of Houston
Tim Echols
Commissioner, State of Georgia
Founder, TeenPact
Brian C. Baker
President
Ending Spending
Kevin Kookogey
President and Founder
Linchpins of Liberty
Ken Boehm
Chairman
National Legal and Policy Center
Gary Aldrich
President and Chairman of the Board
CNP Action, Inc.
:{Amy Ridenour
Chairman, National Center for
Public Policy Research}:
Trent England
David & Ann Brown Distinguished Fellow
Oklahoma Council of Public Affairs
:{Herman Cain
C.E.O.}:
www.hermancain.com
James Bopp, Jr.
James Madison Center for Free Speech
Richard A. Viguerie
Chairman
Conservative HQ.com
:{Grover Norquist
President
Americans for Tax Reform}:
Gary A. Marx
President
Madison Strategies
Joseph A. Morris
Attorney
Chicago, Illinois
Michael J. Bowen
CEO
Coalition For a Strong America
Stephani Scruggs
COO
Coalition For a Strong America
Kathleen Patten
President and CEO
American Target Advertising, Inc.
Richard D. Gaby
Founder/CEO
A K Rikk's
Charles J. Cooper
Cooper & Kirk, PLLC
Michael R. Long,
State Chairman
NYS Conservative Party
Tim LeFever
Chairman
Capitol Resource Institute
:{Heather R. Higgins
President and CEO
Independent Women's Voice}:
Sabrina Schaeffer
Executive Director
Independent Women's Forum
David Williams
President
Taxpayers Protection Alliance
6
Somers H. White
Former State Senator
Somers White Co. Inc.
Pete Sepp
President
National Taxpayers Union & NTU Foundation
Jim Martin
Chairman
60 Plus Association
:{
Floyd Brown}:
Chairman
Western Center for Journalism
TwilaBrase
President and Co]founder
Citizens' Council for Health Freedom
Willes K. Lee
President
National Federation of Republican Assemblies
David W. Preston
Executive Director, Oklahoma
Wesleyan University Foundation
Bill Pascoe
Partner
Antietam Communications
Lewis K. Uhler
Founder and President
National Tax Limitation Committee
Col Francis X. De Luca USMCR(Ret)
President
Civitas InstitutE
==
The ‘Extremist Threat’ Of Environmentalists
Along with access to information for journalists, Stephen Harper’s government has also been working to dismantle environmental groups, a fact that has been revealed, ironically, by document requests from journalists. Those documents show unprecedented attempts from agencies across the federal government to spy on, de-fund, and otherwise disrupt the efforts of environmental groups.....
The most recent example of this has been a rigorous effort by the Canada Revenue Agency to target environmental groups for possible abuse of their nonprofit charity statuses, alleging they may be violating the limits on how much political advocacy work they can do. The CRA’s $8 million effort was launched in 2012, shortly after the pro-tar sands group Ethical Oil kicked off a public campaign to “expose the radical foreign funded environmental groups” criticizing the oil industry.
berman:
Real public-interest groups such as CREW and the Humane Society of the U.S. have tried [24] to hold Berman accountable [25] for years. But they have been thwarted by playing by Washington’s murky rules.
In 2004, CREW filed an Internal Revenue Service complaintto revoke his non-profits’ tax status, which let dozens of corporations funnel[26] millions into a political attack machine. The HSUS filed [27] a similar complaint last year. But the IRS does not want to say when campaigns without candidates—like Karl Rove’s 2012 non-profit [28]—cross the line from “educational” to “political,” which would be illegal. Just this week, for example, it approved [29] non-profit applications for dozens of Tea Party chapters, taking their word that they will limit political work to 40 percent of overall activities.
Berman’s aides, when they talk to the press, say [27] that his non-profits are educational.
IRS Delays New Rules for Dark Money Groups
The agency has pushed back indefinitely a hearing on new regulations for social welfare nonprofits that spend money on politics.
After intense criticism from both ends of the political spectrum, the Internal Revenue Service has delayed indefinitely proposed rules that would have imposed new limits on social welfare nonprofits, which have pumped hundreds of millions of dollars from anonymous donors into recent elections.
The agency said yesterday it would postpone a hearing on the proposal it released in November defining more clearly what constitutes political activity for such groups, and would revise the plan to reflect some of the more than 150,000 comments it triggered..."I think it's unfortunate that new rules will be delayed even further and that we're going through another election cycle" without them, said Paul S. Ryan, senior counsel with the Campaign Legal Center. Others called the delay a prudent step that would give the IRS an opportunity to get a crucial change right.
..."They're not going to put out some slapdash rule just to check it off their list," said John Pomeranz, a Washington lawyer who works with nonprofits that spend money on politics. He doesn’t expect the agency to finish the rules any time soon. “I think we’ll be lucky if they’re in place for the 2016 election.”... Social welfare nonprofits have poured money into politics since the Supreme Court's Citizens United decision in 2010, which allowed corporations, unions and nonprofits to spend unlimited money on elections.
Social welfare nonprofits spent more than $256 million in the 2012 cycle alone, according to the Center for Responsive Politics. Campaign finance watchdogs have viewed their rise with concern, fearing the influence of so-called "dark" money from secret donors, and had called for more oversight from the IRS.
Under IRS regulations, the groups can spend some of their resources on politics, but must devote themselves mostly to social welfare to keep their nonprofit status. But the rules defining what is and isn't politics are murky.<...Conservatives complained that the rules would stifle political speech. The American Civil Liberties Union chafed at a provision in the proposed rules that would prevent nonprofits from backing ads that even mentioned politicians in the two months before a general election. "We have no doubt that the Service is acting with the best of intentions, but the proposed rule threatens to discourage or sterilize an enormous amount of political discourse in America," the ACLU said in its written response to the proposal.
The plan was also criticized for impeding nonpartisan election work such as voter registration drives and get-out-the-vote efforts.
The IRS, still facing fallout from accusations that it singled out the applications of conservative nonprofits for special scrutiny in the run-up to the 2012 election, decided it would make revisions.
"Given the diversity of views expressed and the volume of substantive input, we have concluded that it would be more efficient and useful to hold a public hearing after we publish the revised proposed regulation," the agency said in statement.
http://www.propublica.org/article/irs-pushes-back-new-rules-for-dark-money-groups?utm_source=et&utm_medium=email&utm_campaign=dailynewsletter#
gop tries to trade imf help for ukraine to cancel irs scrutiny of 501c4? 3/14
http://www.propublica.org/article/what-newly-released-docs-tell-us-about-the-irs-and-how-it-handles-dark-mone gps
==
see suzuki canada
te im
koch front tried to use IRS to go after actblue ? (right version withered?) [previously sierra club lost status?]
"scandal: http://www.theliberaloc.com/2013/05/20/the-irs-should-investigate-tea-party-groups-on-non-profit-applications/
...
In fact, the only known 501(c)(4) applicant to recently have its status denied happens to be a progressive group: the Maine chapter of Emerge America, which trains Democratic women to run for office. Although the group did no electoral work, and didn’t participate in independent expenditure campaign activity either, its partisan nature disqualified it from being categorized as working for the “common good.”
The Orange County Tea Party, which has its own blog here, has announced a their participation in a Nationwide Tea Party Protest at the IRS’s Santa Ana office Tuesday May 21.
The OC Tea Party identifies itself as follows:
What is the tea party movement?
It is a movement of WE THE PEOPLE who want to (i) restore our nation to our Founding Father’s wise and timeless original intent, and (ii) preserve our nation of liberty, freedom and equality (eliminate the gross power of special interests).
There are two main purposes of the tea party movement.
- #1 -It is to educate, organize and activate WE THE PEOPLE.
- #2 -It is also to call out the governments’ unconstitutional acts including naming those individuals or groups that support those acts.....
http://www.propublica.org/article/the-irs-moves-to-limit-dark-money-but-enforcement-still-a-question
The IRS and Treasury Department announced proposed guidelines clarifying the definition of political activities for social welfare nonprofits Tuesday afternoon, a move that could restrict the spending of the dark money groups that dumped more than $254 million of anonymous money into the 2012 elections.Read the guidelines here.
However, the guidelines, which finally define what constitutes “candidate-related political activity,” aren’t a done deal. They will take some time for public comment and debate, and more time to finalize. (The IRS asks that all comments and requests for a public hearing be submitted by Feb. 27.) Experts also cautioned that the real test of oversight on the political spending by nonprofits will be how these regulations are enforced, something that the IRS has been so far reticent to do.
The proposed regulations “are only as good as the extent of compliance with them, which history would indicate requires a realistic threat of enforcement and significant sanctions on the groups involved and probably the individuals running those groups,” said Lloyd Hitoshi Mayer, a law professor and associate dean at the University of Notre Dame who specializes in nonprofits and campaign finance....kim barker
--
Treasury, IRS Will Issue Proposed Guidance For Tax-Exempt Social Welfare Organizations
11/26/2013
WASHINGTON — The U.S. Department of the Treasury and the Internal Revenue Service (IRS) today will issue initial guidance regarding qualification requirements for tax-exemption as a social welfare organization under section 501(c)(4) of the Internal Revenue Code. This proposed guidance defines the term "candidate-related political activity," and would amend current regulations by indicating that the promotion of social welfare does not include this type of activity. The proposed guidance also seeks initial comments on other aspects of the qualification requirements, including what proportion of a 501(c)(4) organization's activities must promote social welfare
==
Fox Still Ignoring That IRS Targeted Progressives
Blog ››› August 21, 2013 ››› ZACHARY PLEAT
A day after a Democratic congressman revealed further evidence that the IRS targeted progressive groups, Fox News is still ignoring the story by continuing to suggest that the IRS targeted only conservative groups.
The August 20 edition of On the Record and the August 21 edition of Fox & Friends both highlighted a lawsuit filed against the IRS that seeks to review the agency's guidelines for determining whether an organization deserves tax-exempt status, following reports that the agency inappropriately imposed extra scrutiny on conservative organizations. But in neither of the segments, which together devoted a total of six minutes to the topic, did Fox find the time to mention the fact that :{new evidence:(style="background-color:#fff200"):}: :{released:(style="background-color:#fff200"):}: August 20 effectively ends the IRS "scandal" the network has been :{hyping:(style="background-color:#fff200"):}: for :{months:(style="background-color:#fff200"):}:.
On August 20, Salon reported that the new documents reinforced evidence proving the IRS targeted progressive groups as well:
We already know that the IRS targeted progressive groups in addition to Tea Party ones, but new information released today adds further details, showing that thetax agency also targeted "ACORN successors" and left-leaning "Emerge" groups. Emerge Nevada, Emerge Maine and Emerge Massachusetts were the only groups to have their applications actually denied 501(c)4 tax-exempt status. Conservative groups had their applications delayed, in some cases for over a year, but not rejected outright.
Democrats say the new information should put to rest any lingering embers of the IRS scandal. "This new information should put a nail in the coffin of the Republican claims that the IRS's actions were politically motivated or were targeted at only one side of the political spectrum," said Elijah Cummings, the Maryland Democrat who is the ranking member on the House Oversight Committee.
The term "Emerge" had been redacted from an earlier version of a document released by the IRS, but was present on a newer version made available today. The new documents also showed that successors to ACORN, the liberal grass-roots organizing group that became a bugaboo of conservatives and that Congress defunded (again and again). The instructions on "ACORN successors" came on a BOLO (be on the lookout) list that included healthcare organizations, medical marijuana groups, newspapers, open source technology groups and other non-political organizations.
A day later, Fox News has yet to report on these revelations.
is IRS looking at citizens united crossroads GPS etc as partisan? NOT ANYMORE 5/13
===
rt nation: IRS under carter threatened to take status of schools made after 1953. Prots down but evang up (1980 almost all top 2 doz were) Dallas megachurch had sauna, bowling, skating 84 FM radio station (aud xian radio 10 mil 1970 to 61m 1980; 700 club and old time gospel 15mil each. Falwell etc at 1st not pol, but increased b/c of moral decay.
==
Even Republicans Admit It: Politics Did Not Drive the IRS Tea Party "Scandal"
That sound you hear is the last gasp of the IRS non-scandal scandal.
By Andy Kroll | Fri Jul. 5, 2013
With each passing week, the Internal Revenue Service's supposed targeting of tea party groups looks less like a scandal and more like a case of IRS staffers doing their jobs, albeit in an overzealous, at times clumsy, and narrow-minded way.
From the New York Times we now learn [1] that IRS employees who vetted applications for tax-exempt status heavily scrutinized a Palestinian rights group, open-source software developers, and an organization trying to help musicians make money online. This comes on top of the news, as *Mother Jones* previously reported [2], that the agency also singled out for extra vetting groups with "progressive, "occupy," and "Israel" in their name.
That sound you hear is the last gasp of the tea party targeting "scandal," which some Republicans have tried mightily to hype into a Watergate-esque controversy. Make no mistake: As the agency subjected tea partiers and other conservative groups to an intense amount of scrutiny, it made those same groups wait for months, if not years, to learn whether they'd earned tax-exempt status. This is a big deal. Waiting around that long crimps the flow of donations [3] that a nonprofit needs to survive. Tea partiers are right to be mad about that. But what the drip-drip of revelations in the IRS mess has shown is that it's not fair to say just tea partiers were singled out. Other nonprofits, partisan and nonpartisan, left- and right-leaning, politically inclined and not, got a grilling by the IRS, too. They also endured long wait times.
You'llremember that the Treasury Department inspector general report that first looked at the "targeting" of groups with "tea party" and "patriots" in their name found no evidence of political bias [4]. At the time, Republicans in Congress didn't buy that. Clearly, they argued, this was the work of anti-conservative IRS staffers, or a meddlesome Obama White House looking to suppress its opponents in a closely fought election year. Then we learned that the manager of the IRS Screening Office in Cincinnati, where most of the alleged targeting took place, identified himself [5] as a "conservative Republican." Still, Republicans forged onward.
Now, with these latest revelations, even some GOPers are coming around to the reality of what happened. From the Times:
"We haven't proved political motivation," said Representative Charles Boustany Jr., a Louisiana Republican who, as the chairman of the House Ways and Means Subcommittee on Oversight, is leading one inquiry.
Senator Roy Blunt, Republican of Missouri, said that in retrospect, suggestions that Mr. Obama had orchestrated an IRS attack on his political enemies were unwarranted.
"Presidents have always been very careful about maintaining the appearance of keeping hands off the IRS," he said. "I don't have any reason to believe there wasn't targeting of conservatives, but it might well have been a lot more than that as well."
So there you have it. Republicans have gone from blaming the Obama administration and IRS staffers for targeting tea partiers to double-negative-laced non-concession concessions like Roy Blunt's. (That said, Republicans aren't calling off the hounds quite yet [6]: A spokeswoman for Rep. Dave Camp (R-Mich.), who chairs the House ways and means committee, says committee members will continue to "gather the facts" and "follow them wherever they lead us.")
Questions remain about the process the IRS uses to vet nonprofit applications, and why it takes so long to respond to some nonprofits seeking tax-exempt status. The way the IRS went about scrutinizing organizations in recent years—with its "be on the lookout," or BOLO, lists—is troublesome, which is why acting IRS commissioner Danny Werfel recently scrapped [7] the BOLOs and pledged to reform how the IRS does its job.But as for allegations of politically motivated targeting, with all we know right now, that scandal appears to be dead.
Source URL: http://www.motherjones.com/mojo/2013/07/irs-tea-party-congress-no-politics-progressive
Links:
[1] http://www.nytimes.com/2013/07/05/us/politics/irs-scrutiny-went-beyond-the-political.html?hp&pagewanted=all
[2] http://www.motherjones.com/mojo/2013/06/irs-target-progressive-occupy-green-energy-groups
[3] http://www.nydailynews.com/blogs/theswamp/2013/05/the-irs-scandal-were-the-left-wing-media-also-targeted
[4] http://www.motherjones.com/politics/2013/05/irs-tea-party-ig-report-congress
[5] http://www.motherjones.com/kevin-drum/2013/06/irs-manager-behind-tea-party-screening-conservative-republican
[6] http://www.washingtonpost.com/politics/federal_government/irs-bolos-raise-new-questions-about-political-targeting-uproar/2013/07/04/e4988482-de77-11e2-b797-cbd4cb13f9c6_story_1.html
[7] http://www.reuters.com/article/2013/06/24/us-usa-irs-teaparty-idUSBRE95N18A20130624
IRS
10:54 AM 7/21/2013
eugene g peek iii
r e portrie
w f bragg
jr wolfe
501 riverside ave suite 601 jacksonville
ein 45 2441810
gps stvenlaw
heather wilson
vastola, canndida wolf
bobby burchfield dir
holzman vogel michale bayes
Tea Party Groups Attacking Obamacare Granted Tax-Exempt Status
by Russ Choma on July 18, 2013
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The Internal Revenue Service has granted tax-exempt status to a handful of politically active nonprofits, including several tea party groups and a Florida organization called America is Not Stupid, that ran political ads attacking "Obamacare.'"
America is Not Stupid is a so-called "social welfare" organization -- a nonprofit that may participate in political activities, including attack ads, as long as that is not the group's primary mission. The group is tied to a Republican political consulting firm from Florida, and in last year's Montana Senate race it ran an ad featuring a talking baby who likened alleged Obama Medicare cuts to his dirty diaper.
The IRS came under fire earlier this year when it was revealed that some agency staff had been using keywords including "tea party" to identify applications from groups hoping to be granted tax-exempt status as "social welfare" organizations (it was later revealed that keywords tied to liberal causes were used as well). The idea was to weed out groups that were too political to meet the IRS guidelines.
Since May, when the scandal first erupted, at least four tea party affiliated groups have been granted exempt status:
East Jersey Tea Party, of Jackson, N.J.
Flint Hills Tea Party Education Fund, of Manhattan, Kans.
Hampton Roads Tea Party, Inc., of Chesapeake, Va.
Montana Tea Party, Inc., of Bozeman, Mont.
According to IRS data, 53 other organizations were also granted tax-exempt status in June.
Categories: 501(c) groups, Outside Money
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http://www.propublica.org/article/dark-money-group-spent-on-house-race-then-told-irs-it-didnt
Dark Money Group Spent on House Race, Then Told IRS It Didn’t
Shortly before Election Day last year, mailers went out to Texas voters featuring pictures of a Democratic congressional candidate and a rare species of spider, whose discovery had forced stoppage of an important highway construction project.
“The same left-wing extremists who support Pete Gallego want more burdensome regulations that put the interests of spiders above our need to create more jobs,” the flier declared, referring to discovery of the endangered Braken Bat Cave meshweaver. “The best way to stop left-wing extremists from killing jobs is to vote against their hand-picked candidate Pete Gallego.”
The group that put out the mailer, A Better America Now, reported to the Federal Election Commission it had spent about $65,000 for the mailer and TV advertising in the hard-fought race to represent Texas’ 23rd district.
But in a tax return recently filed with the IRS, the group claimed it did not spend any money at all on “direct or indirect political campaign activities.”
The tax return is signed under the penalty of perjury by the group’s president, Bob Portrie, and the accounting firm LBA Group. Neither responded to requests for comment.
We first reported on A Better America Now earlier this year, showing it had told the IRS in a 2011 application for nonprofit status that it did not plan to spend any money on elections. (That document was sent to ProPublica last year by the IRS, even though the application was still pending and thus not supposed to be released.)
“This type of inaccurate reporting by electioneering nonprofit groups has a long history,” says Public Citizen’s Craig Holman, when asked about the group’s most recent filing. “It is rooted in the fact that the IRS almost never holds these groups accountable for such false declarations.”
A Better America Now was a bit player in the elections. But it’s also an example of the kind of increasingly common outside groups that inject anonymous money into political campaigns.
Such social welfare nonprofits are not supposed to have political campaign activity as their primary purpose — but the ambiguities around how the IRS measures such activity and how it screens the groups are at the center of the recent investigations of the IRS’s treatment of Tea Party groups.
ProPublica has documented how nonprofits that spent millions of dollars on ads in the 2010 elections failed to report or underreported that political spending to the IRS. The tax form that the groups are required to file with the IRS specifically asks for details on any campaign spending.
One of the curious things about A Better America Now is that, though the group spent money in a congressional and a state legislative race in southwest Texas, it is based a few miles off the beach near Jacksonville, Florida.
The president of A Better America Now, Portrie, is also the head of a consulting firm, the Fenwick Group. The two groups are listed at the same address. Fenwick’s website says it works with “organizations across the healthcare, financial services, insurance, retail and investment sectors.”
Portrie and Fenwick were also linked to ads run by another Florida-based social welfare nonprofit, America is Not Stupid, in last year’s U.S. Senate race in Montana. Ads by America is Not Stupid featured a
complaining about alleged cuts to Medicare by President Obama, and referring to the baby’s stinking diaper.
In 2010, the New York Times reported on links between the Fenwick Group and yet another politically active nonprofit, the Coalition to Protect Seniors. Ads by that group featured the same talking baby ad.
In last year’s race in Texas, which attracted a lot of outside spending on both sides, the Democrat, Gallego, prevailed over Republican incumbent Quico Canseco.
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http://www.opensecrets.org/outsidespending/faq.php 501c4
ProPublica’s job is to report the news rather than to make news ourselves, but sometimes we find an article of ours to be itself a subject of public debate. Last week was such a time, when two articles we had published back in December and January became the subject of significant attention in light of the uproar over IRS oversight of the process for granting tax exemption to so-called “social welfare” groups under section 501(c)(4). We triggered that attention, with a third article we published on May 13, setting out everything we knew about the circumstances of our previous stories.
Largely ignored in a public outcry last week—radio rants, Twitter storms, congressional, presidential and prosecutorial posturing-- were the following:
Our pieces in December and January raised very serious questions about whether six different “dark money” political groups seeking tax exemption had made false statements on their applications. Those applications are signed under penalty of perjury . If any false statements were made knowingly, the groups—including Karl Rove’s Crossroads GPS —may have committed a crime. There is no indication, however, that either the IRS or the Department of Justice has done anything since January to investigate whether such crimes were indeed committed. The groups in question happen all to be conservative. Not one congressional Republican has, to my knowledge, expressed any concern about this possible criminality.
Even more remarkably, leading public figures have asserted as fact that they know how we came to receive nine documents in the mail—statements that appear to have little basis (and in some cases, no basis at all).
The former acting Commissioner of Internal Revenue said on May 17 that the agency’s inspector general had found that the disclosure to us was “inadvertent”—we had requested the applications, but they should not have been sent to us before they were approved. The IRS followed later the same day with a statement to the same effect—but then refused to answer questions about who had made the mistake, and why they should be believed when they denied having acted intentionally (and thus likely denied committing a crime).
What really seems to have happened at the IRS in Cincinnati, across the last three presidencies (a Democrat, then a Republican, then a Democrat), and across two turns of the partisan screw in the House of Representatives, from Republicans to Democrats to Republicans again, is that the agency has been starved of resources, and badly mismanaged.
But while it took the IRS four long days to tell people about their conclusion of “inadvertence” and the same four days for ProPublica to report out the dysfunction , people like Rush Limbaugh, and their followers and fellow travelers on Twitter and in the fringe press, rushed headlong to judgment. Here’s what Limbaugh said about the mid-level federal employees at the IRS in Cincinnati on Tuesday: “The people at these government agencies have been stocked with leftists for decades now, and they’re all activists.” What evidence did he offer for this? None. How could he know that someone in a large bureaucracy, shuffling thousands of pieces of paper, didn’t make a mistake? He couldn’t, and he didn’t.
Well, you might say, that’s Limbaugh. But it wasn’t just Limbaugh. Stephen Moore writes for the Wall Street Journal (where I worked for 15 years, and where Mr. Rove also writes). Yet, he called the documents we were sent “illegally leaked .” He knew nothing more than Limbaugh. “What is the motivation,” Moore asked, “for leaking these documents? The answer is that the left is trying to dry up the money of tea party and conservative groups by intimidating donors.” He noted that another group, in another case, had its donor list released. But in our case, there were no donor lists, and we had redacted the limited financial information on the forms we published. Moreover, these applications are completed with the expectation that they’ll eventually be made public—because they are when they are approved. Never mind all that; presumably no need to mention it.
And what of the investigators? Congressional committees leapt into action. The inspector general for the IRS had apparently already investigated. The President demanded another investigation; the Department of Justice said it had commenced a criminal inquiry.
Knowing that such is the way in Washington, we waited at ProPublica for someone to send us a subpoena, show up on our doorstep, or maybe just call. Nothing. Nothing since December 13, when we told the IRS we had these documents they weren’t supposed to have sent us—or since the next day, when we published that fact. Nothing before the inspector general reached his conclusion, nothing before the congressional hearings started televising their demands for answers and their righteous indignation, nothing since.
In point of fact, the investigators would have found out that we have nothing of value to them. But the fact that they didn’t even ask tells you a lot. And it reinforces the point that much of the heat generated last week on this subject is just the latest expression of Washington cynicism and its consequences—that the talk show hosts and their fellow travelers, and the representatives and senators and officials in the executive branch, aren’t really looking for answers here. They’re just putting on a sh
Ambiguity in Tax Rules and Disintegration of Election Law May Have Led to IRS Tea Party Mess
by Brendan Fischer [1] — May 15, 2013 -
- Topics: Corporations [2], Democracy [3], Politics [4]
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The controversy surrounding the IRS singling-out Tea Party-inspired groups seeking tax exempt status -- while inexcusable -- might be attributable, in part, to the agency's failure to create clearer rules for political activity in the post-Citizens United electoral landscape, and it being inappropriately tasked with enforcing campaign finance law, tax law experts say.
After the U.S. Supreme Court's 2010 decision in Citizens United opened the door for corporations -- both for-profit and non-profit -- to spend on elections, 501(c)(4) "social welfare" nonprofits became the vehicle of choice for wealthy donors seeking to keep their political spending secret.
Faced with a surge in new 501(c)(4) applications, an IRS office in Cincinnati charged with the initial review of nonprofit applications "developed and used inappropriate criteria to identify applications [for tax-exempt status] from organizations with the words Tea Party in their names," according to a new report from the U.S. Inspector General, and flagged those applications for additional scrutiny. IRS management failed to adequately stop employees from using the improper criteria, the report found.
The report, initiated after some in Congress highlighted complaints from the Tea Party groups, also found that employees at the Cincinnati office "lacked knowledge of what activities are allowed" for nonprofit groups, in large part because of ambiguity in the rules governing a nonprofit's political activity. That same ambiguity was exploited by groups like Crossroads GPS to influence elections while keeping donors secret.
Ambiguity May Have Given Too Much Discretion to Low-Level Staffers
For publicity-shy donors, giving to a politically-active nonprofit offers a clear advantage over contributing to a Super PAC: the former can keep donors secret, whereas the latter cannot.
In exchange for this donor secrecy, 501(c)(4)s are supposed to have "social welfare," but not "political intervention," as their primary purpose. But many nonprofits in the 2010 and 2012 elections -- mostly groups like Rove's Crossroads GPS that supported Republicans, but also some groups like Patriot Majority USA on the Democratic side -- did little else besides spend on election-related ads, and asserted that their obviously political messages or organizing drives did not constitute electoral advocacy. Some even told the IRS [6] they would not spend a dollar on political intervention.
This exploitation of the 501(c)(4) social welfare section of the tax code was made possible by ambiguity in IRS rules: what constitutes "political intervention" is unclear, and how much is too much is ill-defined. And that may have led to confusion even on the part of IRS staff.
Attorney Greg Colvin, an expert on nonprofit law, told the Center for Media and Democracy that some of the problems with the IRS review process are "absolutely" attributable to the IRS failing to provide clearer guidance about what constitutes an unacceptable level of political activity.
"Qualitatively, the IRS' approach to identifying political intervention is to examine 'all the facts and circumstances,'" he said, which includes enough wiggle room for nonprofits to argue that their ads or organizing drives should count as "education" or "lobbying" rather than electoral advocacy. "Quantitatively," Colvin said, "a 501(c)(4) can be exempt so long as political activity is 'less than primary,'" which could be anywhere from 10 to 49 percent of a group's overall activities.
This ambiguity, he says, "amounts to an invitation to lower level staff to just make it up as they go along." The staff charged with reviewing nonprofit applications "had no written standards to apply and even with supervision, there were no clear rules to be taught."
Similarly, in 2011, Loyola Law School Professor Ellen Aprill wrote [7] that the IRS’ facts and circumstances test “reaches broadly, gives discretion to the administrators, and leaves many organizations and their advisors with little certainty on how to conduct their activity day to day.”
The vague rules -- and the corresponding discretion that it gave to low-level staff -- may have contributed to the IRS singling-out Tea Party groups for review. Confronted with a surge in applications for 501(c)(4) tax-exempt status between 2010 and 2012, the Cincinnati office relied on proxy terms like "Tea Party" or "Patriot" rather than more specific evidence that a particular group was engaged in excessive political intervention. The rising number of applications also coincided with [8] a falling number of staff.
Inspector General: IRS Employees "Lacked Knowledge"
The Inspector General's report bears out these claims. IRS employees in Cincinnati -- as well as 501(c)(4) applicants -- had "lacked knowledge of what activities are allowed" by nonprofit organizations, the report found. Coupled with a rising number in applications and poor management, the Cincinnati employees apparently took politically-loaded shortcuts.
The report continued:
"We believe this could be due to the lack of specific guidance on how to determine the 'primary activity' of an I.R.C. § 501(c)(4) organization. Treasury Regulations state that I.R.C. § 501(c)(4) organizations should have social welfare as their 'primary activity'; however, the regulations do not define how to measure whether social welfare is an organization’s 'primary activity.'"
For years, Colvin, Aprill, and many others have urged the IRS and the Treasury Department to better define electoral advocacy beyond the ambiguous "facts and circumstances" test, and to set limits for how much political advocacy is too much. But the agencies have failed to respond [9].
IRS Inappropriately Tasked With Enforcing Election Law
Exacerbating the problem is that the IRS in many cases has been forced to punch above its weight class.
The weakening of existing campaign finance laws by the Supreme Court, coupled with a largely ineffective Federal Elections Commission and an increase in the number of 501(c)(4) groups influencing elections, meant that election law oversight in recent years has fallen largely to the IRS.
"The IRS is not the best agency to make or enforce campaign finance law," Aprill told the Center for Media and Democracy.
After Citizens United, a growing number of newly-incorporated 501(c)(4) social welfare nonprofits began running election-related ads. These nonprofits -- called "dark money" groups since they do not disclose their donors -- reported spending $315 million in the 2012 elections, and $133 million in 2010, although the total spent is certainly much higher because of gaps in Federal Election Commission (FEC) reporting requirements (an issue CMD outlined in the report Elections Confidential [10], released jointly with the USPIRG Education Fund).
Because these groups are organized as 501(c)(4) nonprofits, they largely do not fall under the purview of the FEC unless they run ads or engage in other activities explicitly calling for the election or defeat of a candidate. Most of the ads run by these groups were so-called "issue ads," which name a candidate and might criticize him or her based on an issue like taxes, but don't go so far as to urge viewers to vote for or against the candidate. Spending on these ads must be reported to the FEC only when they run just before an election. But even then, their donors remain secret.
Disclosure has long been supported by both parties as a key element of campaign finance law: a way to not only hold donors accountable for the messages they fund, but also to hold elected officials accountable if their policy decisions are improperly attuned to those donors' interests. Even the Court in Citizens Unitedvoiced support for disclosure.
But the rise of politically-active 501(c)(4)s in the post-Citizens United world provided donors a way to bypass disclosure laws enforced by the FEC. And Congress failed to pass new transparency laws to close those loopholes -- such as the proposed DISCLOSE Act -- which put the IRS in the unfortunate position of being a campaign finance watchdog. And because its own rules for campaign and political intervention are unclear, the agency has failed at it.
IRS Mess Shouldn't Stop Reform
None of this is to justify the way the Cincinnati IRS office subjected applicants to extra scrutiny based on their political views. This is not the first time [11] the IRS has been accused of politically-motivated enforcement, and Congressional hearings on the issue are justified.
But the fiasco should strengthen calls for effective disclosure laws. And, according to Colvin, "it shouldn't slow the momentum to force the IRS to do a better job of law enforcement. If anything, it points up the need for clear standards recognizable to all concerned, [including] nonprofit tax lawyers, political practitioners, public officials, and IRS employees."
Center for Media and Democracy • 520 University Avenue, Suite 260 • Madison, Wisconsin 53703
Phone: 608-260-9713 • Fax: 608-260-9714
Source URL: http://www.prwatch.org/news/2013/05/12109/ambiguity-tax-rules-and-disintegration-election-law-may-have-led-irs-tea-party-me
Links:
[1] http://www.prwatch.org/users/35275/brendan-fischer
[2] http://www.prwatch.org/topics/corporations
[3] http://www.prwatch.org/topics/democracy
[4] http://www.prwatch.org/topics/politics
[5] http://www.addtoany.com/share_save?linkurl=http%3A%2F%2Fwww.prwatch.org%2Fnews%2F2013%2F05%2F12109%2Fambiguity-tax-rules-and-disintegration-election-law-may-have-led-irs-tea-party-me&linkname=Ambiguity%20in%20Tax%20Rules%20and%20Disintegration%20of%20Election%20Law%20May%20Have%20Led%20to%20IRS%20Tea%20Party%20Mess
[6] http://www.propublica.org/article/how-nonprofits-spend-millions-on-elections-and-call-it-public-welfare
[7] http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1727565
[8] http://www.publicintegrity.org/2013/05/14/12660/irs-nonprofit-division-overloaded-understaffed
[9] http://www.prwatch.org/news/2012/10/11783/colvin-questions-issue-ads-irstreasury-answers-oral-exchange
[10] http://www.prwatch.org/news/2013/01/11944/%E2%80%9Celections-confidential%E2%80%9D-report-reveals-role-dark-money-nonprofits-and-shell-corp
[11] http://www.motherjones.com/politics/2013/05/irs-witch-hunts-tea-party-history-mother-jones
The foundation’s single-biggest early donor was the now-defunct mortgage lender Ameriquest, which gave more than $260,000. (We contacted a number of the companies on the list; they did not respond to requests for comment.) Corporate trade associations including the Pharmaceutical Research and Manufacturers of America, the Edison Electric Institute, and the American Tort Reform Association also pitched in, each giving between $50,000 and $100,000.
The foundation’s affiliated organization, the Republican State Leadership Committee, focuses on winning state-level elections for the GOP and also gets corporate money, including from tobacco and insurance giants. As an explicitly political organization, the committee has to disclose its donors.
By contrast, the recent funders of the foundation, which took in $2.5 million in 2011 including a single donation of $1 million, are still secret.
The foundation applied for IRS recognition as a social welfare group in late 2003 but was initially rejected. The IRS concluded the foundation was “a partisan organization” that “operated primarily for the benefit of a select group” – the GOP. Social welfare groups, the IRS’ rejection letter noted, must promote the “general welfare of the whole community” — not a particular group.
The foundation’s lawyers from the firm Arent Fox fired back in an appeal, arguing that the foundation was not a partisan outfit.
The foundation, according to the 2005 appeal, “was created to promote public debate” about issues including pharmaceuticals, securities regulation, and asbestos litigation.
“It may be useful to describe what the SGLF is not,” the appeal says. “The SGLF:
• Is not affiliated with the Republican Party in any way;
• Does not meet with or coordinate its activities with the Republican Party;
• Does not make contributions to, or accept contributions from, the Republican Party;
• Does not participate in political campaigns, elections or publish electioneering messages on behalf of any candidate or party;
• Does not invite Representatives of the Republican Party to speak at its events, and
• Does not participate in the Republican Party platform, does not recruit or train Republican candidates, does not fundraise for Republican candidates, and does not coordinate its issue selection or policy positions with the Republican Party.
In 2007, more than three years after the foundation’s application, the IRS ultimately recognized it as a tax-exempt social welfare group.
But the group’s protestations that it has nothing to do with the GOP seems at odds with its recent activities. Besides running ads attacking Democrats, the foundation was involved in redistricting in several states to, as the foundation put it in a letter to Republican legislators, draw “legislative lines that we will have to defend in 2012 and beyond.”
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September 10, 2010
Chamber of Commerce Accused of Tax Fraud
By ERIC LICHTBLAU
what was outcome?
WASHINGTON — With a war chest rivaling that of the Republican Party itself, the U.S. Chamber of Commerce has emerged in the last year as perhaps the Obama administration’s most-well-financed rival on signature policy debates like health care and financial regulation.
Critics on the left have long complained about the chamber’s outsize influence. But now they are taking on the business association directly, charging in a complaint filed Friday with the :{Internal Revenue Service:(style="background-color:#fff200"):}: that it violated tax codes by laundering millions of dollars meant for charitable work from a group with ties to the insurance giant A.I.G.
The complaint was brought by a group called :{U.S. Chamber Watch:(style="background-color:#fff200"):}:, which was created four months ago — with the strong financial backing of labor unions — to scrutinize the Chamber of Commerce’s growing influence and provide a counterbalance.
But chamber officials said they had complied with all tax laws and dismissed the complaint as a political ploy.
A chamber spokeswoman, Tita Freeman, said its opponents “are desperately looking for opportunities to undermine the chamber’s efforts to promote free markets and economic growth.”
The I.R.S. refused to comment on the complaint, citing the confidentiality of taxpayer records.
I.R.S. regulators have often been wary of wading into political grievances, particularly after evidence emerged during the Watergate scandal that the Nixon White House had sought to use the agency for political purposes.
But in recent years the agency has occasionally gotten involved in politically tinged controversies. In one high-profile case in 2004, Republican complaints led it to open an investigation into the N.A.A.C.P.’s tax-exempt status after the group’s leader criticized President George W. Bush in a speech. The I.R.S. concluded two years later that the remarks did not violate the group’s nonprofit restrictions on political activity.
At issue in the complaint against the Chamber of Commerce is whether the group mixed funds for charitable and noncharitable political purposes in violation of tax codes.
The chamber, often using expensive mass-market radio and TV spots, has weighed in on many major public policy debates in recent months, including the Obama administration’s health care policy, business regulations, campaign finance laws and Internet rules, as well as job creation and the threat of tax hikes. On many issues, it has pushed for less government regulation in favor of free-market incentives.
Now the chamber’s political arm is turning to the November elections, and it expects to spend $50 million or more to push pro-business candidates, usually Republicans. As part of a wave of new commercials broadcast this week, the chamber’s California affiliate attacked Senator Barbara Boxer — a Democrat running for re-election against Carly Fiorina, the former chief executive of Hewlett-Packard — and accused Ms. Boxer of “destroying jobs” by voting against business.
Cyrus Mehri, a Washington lawyer who brought the I.R.S. complaint on behalf of U.S. Chamber Watch, said in an interview that the chamber’s current political activities were, in effect, being underwritten with money intended for charitable work.
The complaint focuses on loans and grants totaling about $18 million that were made beginning in 2003 to a nonprofit affiliate, the National Chamber Foundation, by the Starr Foundation, a charity started by the founder of A.I.G. and now led by Maurice R. Greenberg, the insurer’s former chairman.
Lawyers for Chamber Watch said their research, based largely on public tax filings, found that none of the principal on some $12 million in loans had been paid back and that the money appeared to have been given to the chamber’s foundation for unrestricted use.
The lawyers said that the money, in violation of nonprofit restrictions, was ultimately funneled to the chamber itself and used to finance broader political causes, including support for legal tort reform to shield companies like A.I.G. from liability. Mr. Greenberg himself had worked to promote restrictions on lawsuits, the complaint notes.
“You have millions of dollars improperly going to the chamber,” said Mr. Mehri, who drafted the complaint with Gail M. Harmon, a Washington lawyer specializing in tax law. “This is not a technical violation.”
But Stan Harrell, chief financial officer for the Chamber of Commerce, said in an interview Friday that the chamber’s lawyers and its accountants at Ernst & Young had reviewed the Starr Foundation funding and found that it complied with all relevant tax law.
“We’ve never had an issue, period,” Mr. Harrell said. He said that Chamber Watch, which was created by a federation of five unions called Change to Win, was simply trying to create trouble for the chamber because of its opposing political views.
“That’s democracy. From time to time, people make allegations,” he said. “If their real interest was proper accounting, they’d be talking to us. This is political.”
Mr. Harrell said that the funding from the Starr Foundation was listed in tax documents as a loan only in the most technical sense and that it was never intended to be paid back. Instead, he said, the money was restricted for long-term use on educational and research projects as part of the chamber’s capital plan and was invested by the chamber to ensure the Starr Foundation a set rate of return.
“We wanted to make sure we guaranteed the investment return,” he said. “Legally, that has to be represented as a loan. This was all done very scrupulously. If anything, we overdisclosed the transaction” in the group’s federal tax returns, he said.
Karl Rove Melts Down When Confronted With Evidence of Bush IRS Investigation:
When David Plouffe confronted Karl Rove with evidence that his Bush administration used the IRS to investigate the NAACP, Rove melted down and stammered baloney. [...]
Rove lied about his association with GPS by leaving out one important detail. Rove isn’t on the board, but GPS works in direct conjunction with the group Rove founded and still advises, American Crossroads. Rove saying that he isn’t involved with GPS was just like Mitt Romney claiming that his presidential campaign wasn’t involved with the pro-Romney super PAC Restore Our Future.
Plouffe was correct. Liberal groups were also targeted by the IRS. Bloomberg reported that the IRS sent the same letter to Democrats that they sent to tea partiers. The IRS did something to the liberal group Emerge America that they never did to the conservatives. They revoked their tax exempt status.
Stop me if you have heard this one before, but when confronted with evidence of the Bush administration targeting liberal groups, all Rove could do was stammer the word baloney repeatedly. Under George W. Bush, the IRS investigated the NAACP’s tax status for two years.Rove even gave the reason for the payback when he pointed to the Bush administration’s outrage over an ad that the NAACP had run. Read on...