The Internal Revenue Service’s apology for subjecting certain Tea Party groups to extra scrutiny merits the widespread attention it is receiving if political bias motivated the audits. The President himself called the emerging scandal “outrageous,” and leaders from both political parties agree. So does Common Cause. More information will soon come to light, because the Treasury Department’s Inspector General is preparing to release a report on its own months-long investigation, which may drop as soon as this week. Meanwhile, IRS officials are steeling themselves for the hot seat, as they should. Chairman Camp announced late Monday that the Ways & Means Committee in the House will begin hearings into the matter as soon as Friday. Senators McCain and Levin announced in a joint statement that the Senate’s Permanent Subcommittee on Investigations will postpone its tentatively scheduled June hearing into lax IRS enforcement of partisan nonprofit groups so that it can expand its investigation into the issues raised by the IRS’s apology. Senator Baucus intends to hold hearings in the Finance Committee, too.
But the apparent actions of IRS officials to prioritize certain (namely, conservative) organizations for audits is only part of the scandal. While Common Cause strongly supports an independent and thorough review of the IRS’s actions, the hearings should also account for the agency’s failure to enforce the law against political front groups masquerading as social welfare organizations. In other words, these hearings must not be used as a Trojan horse to undermine the IRS’s responsibility to impartially enforce the law governing nonprofit political spending. Emphasis on impartially, with equal emphasis on enforce.
Leaked portions of the forthcoming Inspector General’s report support a finding that senior IRS officials were struggling with how best to vet the massive influx in 501(c)(4) “social welfare” organization applications just as the Tea Party rose to prominence, widely credited with flipping control of the House of Representatives in 2010 by intervening in electoral races.
To qualify as a 501(c)(4), the organization’s primary purpose must be the furtherance of “social welfare” and the common good – something that the law expressly says does not include intervention in political campaigns. But that hasn’t stopped corporations and billionaires from forming these tax-exempt groups that flout the law, funneling secretly-sourced money into our elections for the sole purpose of providing donor anonymity. A 501(c)(4) is under no legal obligation to reveal its donors.
Setting up a 501(c)(4) is actually quite simple. The law allows these nonprofits to “self-declare,” submit the IRS application, and immediately begin spending on political ads, even before the IRS advises the group on the status of their application, which can take years.
Full Article: Tempest in a Teapot? | Common Blog.