IRS plans new rules for 501(c)4 organizations

By Dan Brooks in Uncategorized 4 Comments
Political spending by tax-exempt groups over the last decade, according to the Center for Responsive Politics

Political spending by tax-exempt groups according to the Center for Responsive Politics

If you want to understand the problem of false equivalence in political reporting, consider this article from the Wall Street Journal about new IRS rules governing the political activities of 501(c)4 nonprofit organizations. The designation is intended for social welfare organizations, but it also covers the NRA and a slough of Tea Party groups, whose primary contribution to social welfare is relentless advocacy for their own legislative and political interests. As the Journal puts it in the story’s second paragraph:

Rules proposed Tuesday could at once help to curb the explosion in political spending by nonprofit groups, such as conservative heavyweight Crossroads GPS and the liberal Priorities USA, while setting clearer standards that could help the government avoid future dust-ups with politically active nonprofit organizations.

It sounds like Crossroads GPS and Priorities USA are two sides of the same dark-money coin, right? Except nine paragraphs later, we learn that Crossroads raised $180 million in 2011-2012, and Priorities raised $10.7 million.

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Tea Party leader: Distributing Romney literature “not a political activity”

By Dan Brooks in Tea Party 3 Comments
Social welfare

Social welfare

Last week, we discussed the IRS/Tea Party scandal and the problem of distinguishing social welfare organizations from political groups. Noted parser of fine distinctions Ben al-Fowlkes sent me this follow-up article from the New York Times, in which intrepid reporters who are probably interns researched some of the complainant groups. It’s an interesting read throughout, but it reaches a boiling point of surreality with the last two paragraphs. Quote:

…[T]he Ohio Liberty Coalition, another Tea Party group that has complained about the scrutiny it received from the I.R.S.,… canvassed neighborhoods, handing out Romney campaign “door hangers,” Mr. Zawistowski said. The I.R.S. usually considers such activities to be partisan. But when Mr. Zawistowski consulted his group’s lawyers, he said, he came away understanding that the I.R.S. was most concerned with radio or television advertising. He said he believed that other activities, like distributing literature for the Romney campaign, would not raise concerns. “It’s not political activity,” he said.

At least one of the groups that applied for 501(c)(4) status in the last few years claims that going door-to-door on behalf of a candidate for president is not a political activity. How does one deal with/in such mendacity?

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Meanwhile, in Clarence Thomas’s wife’s head

By Dan Brooks in Tea Party 3 Comments

Nice couple.

Combat! blog vacations in beautiful sunny well-groomed Los Angeles, California, today, and finds itself already adopting Californian work habits. While I blow dry my hair in my avocado linen jacket, how about you horrify yourself with the news that Virginia Thomas, wife of Supreme Court Justice Clarence Thomas, has started her own Tea Party chapter. This will surely allay my fears! “She is intrigued by Glenn Beck and listening carefully,” says her bio on Liberty Central, a name that no one will realize is ironic until midway through the 2012 corporate giving season election. In addition to holding the power to un-forgive a member of the Supreme Court for publicly acknowledging that he makes a lot pubic hair jokes, Virginia Thomas’s 501(c)4 can accept an unlimited quantity of corporate donations. “Because of a recent Supreme Court decision,” the LA Times observes drily, “the group may also spend corporate money freely to advocate for or against candidates for office.” Or it could, had it not already been busted for operating illegally. Faster than you can say “conflict of interest in sleeping on the hide-a-bed, Clarence,” Virginia consumer protection officials sent a letter of warning to Mrs. Thomas, informing her that Liberty Central was receiving donations while not properly registered as a charity. At least we know she’s not getting free legal advice. The citation is not uncommon—”Our policy is to assist them to come in compliance with the law,”* says state regulator Michael Wright—so Thomas’s group will either A) go the same way as that sweater she started knitting or B) funnel millions of corporate dollars to conservative political candidates while her husband adjudicates from the Supreme Court. Coin toss!