IRS, conservative groups spar over tax-exempt status
The Internal Revenue Service is embroiled in battles with tea party and other conservative groups who claim the government is purposely frustrating their attempts to gain tax-exempt status.
The fight features instances in which the IRS has asked for voluminous details about the groups’ postings on socialnetworking sites like Twitter and Facebook, information on donors and key members’ relatives, and copies of all literature they have distributed to their members, according to documents provided by some organizations.
While refusing to comment on specific cases, IRS officials said they are merely trying to gather enough information to decide whether groups qualify for the tax exemption. Most organizations are applying under section 501(c)(4) of the federal tax code, which grants tax-exempt status to certain groups as long as they are not primarily involved in activity that could influence an election, a determination that is up to the IRS.
The tax agency would seem a natural target for tea party groups, which espouse smaller and less intrusive government and lower taxes. Yet over the years, the IRS has periodically been accused of political vendettas by liberals and conservatives alike, usually without merit, tax experts say.
The latest dispute comes early in an election year in which the IRS is under pressure to monitor tax-exempt groups — like the Republican-leaning Crossroads GPS and Democrat-leaning Priorities USA — which can shovel unlimited amounts of money to allies to influence campaigns, even while not being required to disclose their donors.
Conservatives say dozens of groups around the country have recently had similar experiences with the IRS and say its information demands are intrusive and politically motivated. They complain that the sheer size and detail of material the agency wants is designed to prevent them from achieving the tax designations they seek.
“It’s intimidation,” said Tom Zawistowski, president of the Ohio Liberty Council, a coalition of tea party groups in the state. “Stop doing what you’re doing, or we’ll make your life miserable.”
Authorities on the laws governing tax-exempt organizations expressed surprise at some of the IRS’ requests, such as the volume of detail it is seeking and the identity of donors. But they said it is the agency’s job to learn what it can to help decide whether tax-exempt status is warranted.
“These tea party groups, a lot of their material makes them look and sound like a political party,” said Marcus S. Owens, a lawyer who advises taxexempt organizations and who spent a decade heading the IRS division that oversees such groups. “I think the IRS is trying to get behind the rhetoric and figure out whether they are, at their core, a political party,” or a group that would qualify for tax-exempt status.
The tea party was first widely emblazoned on the public’s mind for their noisy opposition to President Obama’s health care overhaul at congressional town-hall meetings in the summer of 2009. Support from its activist members has since helped nominate and elect conservative candidates around the country, though group leaders say they are chiefly educational organizations.