Back when I was young, there was a racially motivated “joke” that centered around whether all people entering heaven would be equal. The punch line was that St. Peter gave the person of color a much harder word to spell – Albuquerque.
Well isn’t that what the IRS did when it put hundreds of applications through a much more difficult criteria to become tax exempt?
The Left has countered that the IRS, under Bush’s direction (not just under his administration), conducted similar activities that were equally politically motivated.
I have done some research into the recent IRS scandal, and the Left’s comparison with audits on Greenpeace, NAACP, and the All Saints Episcopal Church in CA. I believe I have come up with a reasoned opinion as to why these aren’t related incidents.
Let me start by saying, “Really?”
Firstly, for Bush to be directly involved in the above mentioned audits during his term would have literally taken an act of Congress. Nixon’s misuse of the IRS for political payback took care of that problem. Audits can be initiated for any number of reasons, but merely badmouthing a president or administration is not one of them. Opposing a candidate is. Given the NAACP’s 2003 internal accounting and accountability issues alone, I think it was reasonable for the IRS to look into how the NAACP was actually spending its funds. Greenpeace had definitely become more political in its literature and practice. The only thing I know about the All Saints Episcopal Church in LA is that it considers itself and is considered “politically active”. Is that the purpose of a church?
The question is whether these organizations were selected strictly by their political leanings. According to their IRS tax exempt status and how they chose or organize, their primary activity can not be political, so while it could be reasonable to discuss how legislation is affecting the organization, and lobbying for or against legislation, singling out candidates in an election year is not. I would recommend that bit of advice to any organization that is chartered as a 501(c) 3.
Lawrence Kopp of nj.com stated in an article that:
When it comes to lobbying and political activity, 501(c)(3) organizations can appeal directly to legislative bodies and representatives and may support issue-based legislation. However, they must notify the IRS of their intent to lobby by filing form 5768, which formally informs the federal government that one has elected to use the expenditure test to have the organization’s lobbying activity measured. Under this test, lobbying capacity is typically limited to spending less than 5 to 20% of the organizational budget on lobbying activities, depending on the size of your organization.
501(c)(4) organizations can engage in unlimited lobbying so long as it pertains to the organization’s mission. 501(c)(3) organizations are not permitted to engage in political activity, endorse or oppose political candidates, or donate money or time to political campaigns, but 501(c)(4) organizations can do all of the above. (bold emphasis mine)
The Left can complain all it wants, but the Chairperson of the NAACP (a 501(c)3) clearly violated regulations when he called for Bush’s ouster as reported by CNN in July 2004 – you know, an election year when Bush was a candidate.
Greenpeace (a 501(c)3) claims that the Bush administration singled it out for audit in 2004. That’s not true. A group funded by Exxon Mobile asked that Greenpeace be audited . That was uncovered by the WSJ and a transcript is available here. What is not mentioned in that article is that Greenpeace did receive letters about moving funds from its 501(c)3 to its 501(c)4 (political) account in what was termed “Enron-type accounting”
Mr. NUNES. Which I commend you for conducting that report. I think it is important. I have two letters here that are dated March 1st from the IRS to Greenpeace, to their 501(c)(4) and the Greenpeace Fund, which is a 501(c)(3), in which in the letter you say that they continue to qualify for exemption from Federal income tax despite the fact that it clearly outlines the political activity that was a violation of Federal law. It looks to me like from what they were doing, it is Enron-type accounting, where they were moving money from one account to another, and then never repaying the loan.
The LA Episcopal Church (a 501(c)3) said to vote for either candidate, but then qualified that statement with an anti-war comment specifically citing Bush. If it didn’t intend to break the letter of the law, it certainly broke the spirit of the law as the comment came 3 days before the election.
These are 3 clear cases of Non Profits (501(c)3) pushing the boundaries of what is permissible under the rules they chose to organize under. This is NOT the same as holding hundreds of applications filing under the correct type of non profit hostage for no other reason than someone told IRS people to flag applications containing obvious conservative key words until the applicants could spell “Albuquerque” to the satisfaction of the IRS in what appeared to be an ever changing spelling.