WASHINGTON — The Internal Revenue Service is caught in an election-year struggle between Democratic lawmakers pressing for a crackdown on nonprofit political groups and conservative organizations accusing the tax agency of conducting a politically charged witch hunt.
In recent weeks, the I.R.S. has sent dozens of detailed questionnaires to Tea Party organizations applying for nonprofit tax status, demanding to know their political leanings and activities. The agency plans this year to press existing nonprofits like American Crossroads, on the Republican side, and Priorities USA, on the Democratic side, to justify their tax-protected status as “social welfare” organizations, a status that many tax professionals believe is being badly abused.
Senate Democrats are readying a fresh legislative push to demand that such groups disclose their donors and attach disclaimers to their political advertising identifying the advertisement’s primary funders. Tax experts are also raising concerns that corporate donors to “super PACs” may be deducting their contributions as business expenses.
“The shadowy attack ads we see every day should be brought into the light,” said Senator Michael Bennet, Democrat of Colorado. “The largest contributors should stand by the ads they’ve paid for, the voters should know who’s behind these ads, and these super PACs should not be allowed to abuse our tax code by masquerading as nonprofit charities.”
The pushback is likely to be just as fierce. Jay Sekulow, a conservative lawyer known more for his stands on religious freedom than for his tax work, said he is representing 16 Tea Party groups that are claiming harassment by the I.R.S., and the number is growing. He said he intended to demand an explanation from the Treasury Department on Wednesday for what he called “McCarthyism” tactics and that he would contact Republican lawmakers this week.
I don’t claim to be an expert or even close about tax laws and non-profit status. I am having a hard time figuring out why the various tea party groups are so outraged over having to justify their tax exempt status or why any of them are passing the grade for tax exempt status. The last time I had anything to do with non-profit groups, there were rules one had to follow in order to keep their status. The first rule was that you couldn’t support political candidates and keep that tax free status.
What does the tea party do if not support candidates? What should the IRS look for? ” Tea Party” seems to be a dead givaway to me. Why should donations that go to support candidates be tax exempt? They sure aren’t for the rest of us earthlings.
Don’t get me wrong. I am NEVER on the side of the IRS. It’s unAmerican. However, I am having a difficult time wrapping my brain around this one. Political groups that support candidates almost never get tax exempt status. Why does the tea party feel it’s special?
@Steve Thomas
Nothing turns me off more than the excpression “left wing media.”
I was glued to the TV the day of the Boston Marathon bombing and I channel surfed incestantly. I never heard one word that it might be the tea party. I heard no one knew who did it other than terrorists.
I did hear questioning about ome grown or foreign grown. That hardly indicts the tea party.
News should tell the news, not slant one way or the other.
I have seen very few specifics. My next question would be how many groups and what was asked for? Then I would like to see what groups without tea party in their name have to jump through.
@Furby McPhee
One more thing, Planned Parenthood Action fund is the following, from their web page:
The non-profit aspect is no big deal. Its the political arm that puts you on the Do Not Deduct list.
I thought you should know this in case you were planning on a donation. It will not be tax deductible.
Many years ago, at a different rodeo, I used to be able to rattle this stuff off a lot faster. Both NARAL and Planned Parenthood are cooked as far as tax deductible donations. They support pro chooice candidates. This political activity scorches any tax deductions.
Moon,
You are confused, as is Elena. Churches and other 501(c)(3) organizations are tax-deductible charitable organizations. As such, there are greater limitations on political activity. The Tea Party, Heritage, and a whole myriad of non-profits are 501(c)(4) are not tax-deductible organizations, and they have fewer restrictions on political activity. My tithe to my church is tax-deductible, but membership dues and donations to the Tea party would not be tax deductible. So, the entire line of “Tea Parties are political” and the whole “in 2006 Liberal Chruches were investigated” arguments fail because the factual foundations they are based on are flawed.
Steve, I am not confused. You are obviously confused about what I have said. Where is all this coming from? I never said once that churches weren’t tax deductible charitable organzations.
Some churches walk right up to the line as far as endorsing candidates also.
I am stepping out of the conversation because I am tired of being misquoted and I can’t think of anything more boring than arguing about tax code, especially when I have made no claims other than not being allowed to endorse candidates.
Salon.com, CNN, Current TV, and and more than a few other news media outlets intitially speculated that the bombings were the work of “Right Wing Extremests”, basing this speculation on the fact that the bombings occurred on April 15…tax day…Patriots Day in Massachusetts…Sorry to turn you off with “Left Wing Media”, but it wasn’t Fox News, Drudge, or Rush Limbaugh making this speculation….I can go fetch all the articles that prove they made these speculations based on NOTHING…At least profiling is based on some rational rooted in fact.
Right wing extemist is not equal to tea party. Right wing extremist to most people is like Timothy McVeigh or supremacist types. Plenty of folks dislike taxes that aren’t tea party.
You think CNN is left wing media??? holy cow.
I never thought for one minute a tea party person would bomb innocent people. I already know that McVeigh types would. I didn’t check with salon.com or Current TV. I tend to stick to the main news sources.
@Steve Thomas
Take a local organization such as Help Save Manassas. Was that a 501(c)(3) organization or a 501(c)(4) organization? Did it support candidates? I saw only Republican candidates who were showcased at it’s meeting that was captured by “9500 Liberty”. It received a rather substantial donation($6800) from the Republican Senate Victory PAC. That money was channeled where? Or used how?
There are many people who would debate whether its existence helped or smeared Manassas.
I think that both liberals and conservatives play real loosey goosey with the tax laws.
I think if we looked at any group we could find some real discrepancies in the letter and spirit of the law.
It can be something as innocuous as a Save the Whooping Crane down to some of the tea party groups.
Totally agree. I don’t have a problem with the IRS putting the screws to organizations trying to scam the tax code, as long as they do it evenly and across the board. (which doesn’t seem to be the case here, and that’s the problem)
Cato,
I agree, in that we find common ground. Just like I wouldn’t complain about that liberal church in CA being investigated, if you preach politics from the pulpit and endorse candidates, you lost tax exempt status, no matter left or right leaning.
I believe that Citizen United has really confused tax exempt with political purpose.
I was treasurer for Voters To Stop Sprawl, we were a 501(c)(4). We were absolutely not tax exempt and we worked for the greater good in our minds. That designation within (c)(4) for tax exempt is what is screwing everything up.
I’d like to know if that reflects Citizen United changes!
So apparently, it’s not just one rogue IRS office. It’s at least three different IRS offices (Cincinnati, California and HQ) that are involved so far. People are now starting to look into how Crossroads GPA had their confidential filings leaked to the public last year. We’ll know even more tomorrow when the IRS releases its report. That should be the starting point for the investigations, what the IRS admits to doing. But there needs to be an independent investigation to make sure that this report isn’t whitewashing the whole thing.
I still don’t see anything that links this to Obama, but there needs to a real investigation and a major shakeup at the IRS. Even if the higher ups didn’t authorize this, it looks pretty obvious that IRS culture said attacks on Republican groups was OK.
Everybody who was involved in this needs to be fired, prosecuted and jailed. Democrat, Republican, whoever. Obama was smart to condemn it yesterday. Now he just needs to appoint a special prosecutor to investigate it.
@Cato the Elder
“Totally agree. I don’t have a problem with the IRS putting the screws to organizations trying to scam the tax code, as long as they do it evenly and across the board. (which doesn’t seem to be the case here, and that’s the problem)”
Agree. As I said earlier, it is the blatant lack of universal application of the law, and the perception that there was a “special enforcement” implemented for groups that oppose the current administration’s policies, lends creedence to these group’s collective narrative; a government out of control, reaching into too many aspects of our lives, growing in power, that needs to be confronted and reformed. What makes this even more onerous to me, is that when you consider the fact that many of the targeted organizations were formed to oppose Obamacare specifically, and the IRS is charged with the enforcement piece of the SCOTUS defined “tax” of Obamacare, the targeting of these groups (and as we are now finding out, individuals associated with these groups as well) by the IRS just seems…what’s the word I am looking for?…”Convenient”.
For years, those on the left, especially the media, have painted people who were members of conservative groups as “paranoid, clingers to their God and guns, guided by an irrational fear of government”, and now the IRS, one of the most universally feared, most powerful government institutions has now been caught abusing their power. Feared? Yes. Even honest taxpayers who have nothing to hide, don’t want to go through the pain of an audit. The IRS can slap a lien on your property, garnish your wages, sieze your bank accounts, all without a court order. Bankruptcy offers no protection against tax liabilites, and you can only be thrown in jail for non-payment of two kinds of debt; child support, and taxes.
What we found out over night is not only did the IRS target Tea Party groups, the targeted a whole bunch of groups that were formed on conservative principles. We also found out that two top officials lied to congress about not having knowledge of these actions of IRS agents. Also, we no find that not only groups were targeted, but individuals associated with the groups as well. Demands for donors and volunteer lists. Demands for passwords to “members only” sections of websites. Demands for passwords to email and social media accounts. Both groups and individuals were threatened with prosecution, fines and “up to and including prison” for failure to comply.
I agree that the President is right AND smart for condemning this, and hope he supports a full and complete investigation, regardless of how high in his administration the investigation leads. With the newest scandle now breaking (the DOJ seizing the phone records of the Associated Press corporate accounts, as well as the private records of AP employees), this Administration needs to get in front of at least one scandle…
and not to change the subject, but I predict that the AP scandle will lead to the press turning on Obama. They will call for an independent prosecuter for the IRS thing, and maybe Benghazi too, as I doubt they trust Holder’s DOJ much now. I also predict Holder is gone by the end of the summer.
@Elena
I wonder what the tax status of Westboro Baptist is? They don’t seem to fit in either niche. Everyone dispises them.
@Furby McPhee
Why are we classifying tea party as Republicans?
I still say that all organizations play far too loosey goosey and there are no standards.
I am sure that Democratic groups feel picked on during other times.
I am also sure that individuals feel picked on. I watched someone try to use the IRS to make a point with someone locally. I have never felt the same about that person.
If your organization was classified as 501(c)4 by the IRS, then you were absolutely tax exempt for almost all of your income, with the sole exception of expenditures in direct support of particular candidates, or gift taxes.
I probably needed to clarify my point. Donations were not tax deductible, you could not claim as charity, that was the point I was making. We had no income per se, it was all intended as donations to support electoral goals.
HSM was a 501(c)(4) issue-advocacy (illegal immigration) organization. It did not endorse any candidates. It did produce mailers and voter guides that listed the voting records and policy positions of candidates in the races during that time frame, specific to the immigration issue, something perfectly legal under state and federal election laws, and this was pre-Citizen’s United. This is what that $6800 was used for, again, perfectly legal under state and federal election law.
As to your comments regarding what you saw in a clearly biased documentary (nothing wrong with the bias, but let’s be intellectually honest, Eric and Annabel inserted themselves into the debate), and your opinion as to whether or not HSM’s goals fit your definition of “public good”…thanks for the chuckle. I mean that.
@Elena
You couldn’t claim them as tax-deductible before Citizen’s United, and you can’t claim them now either.
@Steve Thomas
I’d say “public good” was debatable because one can go to forums such as City Data’s and see just how bad Manassas’s reputation became specifically because of immigration. Most posters will recommend against a move there. It, and PWC, gained the reputation of being the armpit of the area. It’s a reputation that the City Council has to fight hard to escape.
Just as loose lending practices allowed people to move into neighborhoods that they couldn’t afford – or afford to maintain their homes – the bubble burst drove them away. But a heating up housing market will bring many people back. In the meantime HSM and its ties to Greg (and by association, his blog) gave specific neighborhoods bad publicity that they’re having a hard time overcoming.
@Steve Thomas
Groups on both the left and the right, as well as individuals, have been targetted by the IRS, or so it appeared. I am not comfortable speculating at this point. Find out the facts first.
Yes, but so far nobody is claiming anybody on the left was specifically targeted because of their political positions. Everybody admits (including the IRS and the White House) that conservative groups were targeted because of their political positions. Who did it, how often and why needs to be investigated, but that it happened is already admitted to by the IRS.
Steve Thomas is right about this. The IRS being involved in politics is about as dangerous as it gets. I suppose the army drafting people based on politics would be worse but there’s no draft. Whether by accident or not, the IRS has been turned into a wing of the Democratic party.
There’s a man who was in an ad for Romney that was later audited by the IRS. He claims it’s because of his politics. Before this scandal, most people would say he’s just a tax cheat who is claiming to be persecuted. Now, it’s not so clear.
What’s the old saying, “Just because you’re paranoid doesn’t mean someone isn’t out to get you.” The IRS has admitted they were out to get conservatives. Like I keep said, if you don’t see why this is a huge scandal, imagine switching it around. If Ken Cuccinelli had the state tax agency go after Planned Parenthood solely because of their politics, you’d be howling and not just at the moon. (Of course, I shouldn’t say this. It might give Cuccinelli an idea.)
Everybody, Democrat and Republican alike should be agree that this needs to be investigated and everybody responsible needs to be punished very severely. No wrist slaps. Jail time and restitution to the victims. A strong response is the only defense against this becoming routine in politics and we really don’t want that to happen.
Which groups on the Left?
You know……. if we got rid of the income tax and went to a national sales tax…all this would be moot. If we had a party in Congress truly interested in American freedom, the questions would not be, “Who authorized the IRS to do this?” but would be, “Why do we have an agency AT ALL that has this power and since it abuses said power, why do we keep it?”
It just keeps growing and growing…
The division of the Internal Revenue Service that improperly scrutinized the tax-exempt status of conservative groups sent confidential information on 31 conservative groups to the well-funded liberal nonprofit journalism organization ProPublica, according to a revelation made by ProPublica Monday.
That’s crazy-talk. You are just being paranoid. You need to take off the “tin-foil beret”. Go clean your guns, no one wants to take them. The government is good, and should be in charge of your healthcare. There is no voter fraud, so stop trying to say there is. There is no conspiracy here. It was a video that got those Libyians all riled up. Osama is dead, and the terrorists are on the run.
@Steve Thomas
Left wing groups during the vietnam war. MLK for a small example.
You missed one:
“It’s all Bush’s fault.”
So other Democratic presidents (Kennedy and Johnson) misusing the IRS to target MLK justifies targeting conservatives now? It sure wasn’t Nixon who used the IRS to go after MLK since Nixon wasn’t in office until after MLK was assassinated.
I guess the lesson is that the IRS will target the enemies of a Democratic president regardless of ideology. 🙂
You might have something on anti-war groups during Vietnam, but that was 40 years ago. Even so, two wrongs don’t make a right. The IRS needs to be beaten down over this so much that the idea of targeting ANYONE based on their politics should make every employee in the IRS shudder in fear.
At first I thought this story really was going to be about a handful of rogue IRS agents. But now it looks too big to just be a few people and it’s getting bigger. There’s a lot of talk about senior people in the IRS knowing about this before the election and lying about it to Congress.
I’m sorry to see that Obama’s press guy is now saying the IRS didn’t really admit to what they admitted to the other day. Obama needs to get back on the right side of this and make sure some heads roll.
Too bad the IRS was clumbsy and not even handed. All sorts of groups that have flocked to social betterment status since Citizsens United flout or ignore the tax laws.
The IRS needs to take a look at many of these groups and I don’t just mean the tea party.
Citizens United was like a siren call to push the envelope. The lines used to have a much clearer distinction. Now they are very much blurred.
@Moon-howler
You mean groups like the “Weather Underground”? “Black Panthers”? “Winter Soldiers”? Criminal organizations?
@Furby McPhee
Actually it went on under Kennedy and Nixon. I was referring mostly to Nixon however.
The USA has a lengthy history of the IRS being the hammer.
@Moon-howler
“Citizens United was like a siren call to push the envelope. The lines used to have a much clearer distinction. Now they are very much blurred.”
Agreed.
Nixon’s IRS probably did it too, but the only example you gave (MLK) was clearly JFK and Johnson, so I couldn’t resist pointing that out. 🙂 You’ll never find me defending old Tricky Dick.
The old “the other side does it too” excuse has to stop. If we are ever going to try to clean up politics, we have to start playing by the rules and get just as outraged at abuses on the left as abuses on the right. We need to set our sights higher than what Nixon could get away with.
Wouldn’t it be great if we could all agree on measures to make sure this is the last time the IRS abuses its power like this.
@Steve Thomas
I believe there were a few more than that, Steve.
If you can push your partisanship aside for a moment, how about United Klans, Southern Christian Leadership Conference, ACLU, University of North Carolina, American Library Association, Conservative book Club, NAACP, National Urban League, ford Foundation, Headstart…..
@Furby McPhee
Perhaps you aren’t old enough to appreciate him for some of the real progress he made. He was a creep but he did some good things.
No one is all good or all bad.
Obviously there is a cross over in there between 1961 and 1974 when Nixon resigned. You are right. MLK was killed before Nixon took office as president His death sure didn’t end the IRS invasion into the personal lives of those associated with him and his family.
I am not accusing anyone but J. Edgar Hoover of ordering the IRS to track MLK. He was also tracking some of those presidents for various things, lest they try to strip him of his power. After McCarthy and Hoover, it makes what goes on now look like chicken feed.
@Moon-howler
You said “Left Wing Groups”, those are the groups who came to mind. Any group that had an element of criminality, like the United Klans, was just asking for IRS scruitny. Not saying it was right for the IRS to do this to the other groups, left or right, but this is different, and this is now.
@Furby McPhee
I am not saying ‘the other side does it too.’ Far be it from me. I am pointing out that the tea party isn’t the only sacrificial lamb here and that the United States has a long history of using the IRS as its rottweiler.
That should concern you.
On the other hand, groups both left, right and in between dance right up to the line, sometimes step over, and abuse the tax laws. That should be a concern also.
@Steve Thomas
Since I was the one posting, I threw in lots of folks who have been the object of IRS interests.
Actually, I have heard enough whining on TV to last a lifetime over this. Tea Party Victimization.
See who did it, fire them, and be done with it. Then the IRS needs to go out and check the status of all these groups, right, left and in the middle.
The tea party isnt the first group to be looked at and they wont be the last.
Social welfare my ass! That phrase needs to be removed from the tax code.
I actually started out just questioning why i should be able to write off a donation to the tea party on my taxes.
Now I want a full investigation to see what they are all hiding. No one whines that much or protests that much. I want the IRS investigated, I want the tea party whiners investigated, and I want to see who else got investigated. Bet a buffalo that it wasn’t just the tea party.
@Moon-howler
“I actually started out just questioning why i should be able to write off a donation to the tea party on my taxes. ”
Which you never could, nor should anyone be able to. Legitimate charitable organizations should be tax-deductible. Churches…feed-the-children…habitat for humanity…and the ever annoying 1-800-7KARS4KIDS, 501(c)3 organizations. I would agree with you that there is too much special interest money, both left and right, to foster a true government for and by the people. Sorros and Koch Brothers. Bundlers on both sides. Super PACs. Crossroads GPS AND SEIU.
But my biggest goal in this debate has been to point out that perhaps a little healthy distrust of government (regardless of which party is in charge) is not such a bad thing, and we should less quick to paint our fellow citizens as “fringie, tin-foil beanie-wearing, conspiracy kooks”, because this IRS episode illustrates that our government abuses its power periodically. Whether warrantless wire-taps, seizing phone records, or using the tax code to harrass people engaged in the exercise of free or religous speech, the government, or our electeds get caught doing this, they need to be held to account. So the next time “the gun nuts” are opposed to gun control, deeper background checks, registrations, or tracking ammo purchases, please try to consider that their fears of eventual confiscation might just be justified, and the 2nd Ammendment ain’t about burglars and duck hunting.
The Inspector General Report concudes that the IRS used inappropriate criteria to evaluate.
Many groups received unnecessary. burdensome questions.
@Steve Thomas
@Steve
Exactly. I shouldn’t be able to do that if I follow the rules of the game. (nor moveon.org or many other groups)
I still fail to see the social welfare end of these groups who clearly exist to elect candidates of their liking. Nothing wrong with that. Plenty wrong with social welfare.
I am so happy. Ron Reagan Jr. is on my TV. I can’t turn of that slobbering sputtering rude fool Chris Matthews because I have to see Ron Jr.
But my biggest goal in this debate has been to point out that perhaps a little healthy distrust of government (regardless of which party is in charge) is not such a bad thing, and we should less quick to paint our fellow citizens as “fringie, tin-foil beanie-wearing, conspiracy kooks”, because this IRS episode illustrates that our government abuses its power periodically. Whether warrantless wire-taps, seizing phone records, or using the tax code to harrass people engaged in the exercise of free or religous speech, the government, or our electeds get caught doing this, they need to be held to account. So the next time “the gun nuts” are opposed to gun control, deeper background checks, registrations, or tracking ammo purchases, please try to consider that their fears of eventual confiscation might just be justified, and the 2nd Ammendment ain’t about burglars and duck hunting.
(steve)
I still fail to see the social welfare end of these groups who clearly exist to elect candidates of their liking. Nothing wrong with that. Plenty wrong with social welfare. (Moon)
Moon, BUT what IF the bigger picture was for a one world government…
Where in the hell did that come from?
No one has suggested that the tea party wants one world government.
Everybody look surprised now, but it looks like the same group that was harassing conservative groups gave preferential treatment to the Barack H. Obama Foundation, founded by a half-brother of Obama. The Obama foundation got approved in less than a month and got special exemption to make their approval retroactive for three years.
It’s obvious that at the IRS there’s one set of rules for conservatives and one set of rules for liberals. I suppose we should all get ready for the next shoe to drop, which I’m expecting to be that donors to tea party groups were singled out for extra scrutiny.
We still aren’t in Nixon territory yet (who I remember quite well!) but if this thing keeps rolling along who knows where it will end up.
@Moon-howler
I think that he was stating that said parties are AGAINST “one world government” and that the establishment is for it.
Thanks Cargo! That is what I was trying to convey.