https://consortiumnews.com/2013/06/24/the-irs-non-scandal-scandal/
"...Regarding the use of various “dark pool” schemes for hiding political donations, we have real scandals, as Wertheimer, ProPublica, Mother Jones, the New Republic’s Noam Scheiber and others point out: The “social welfare” nonprofits that tell the IRS that they are not going to spend money on elections, receive IRS recognition, and then turn around and spend money on elections. That means the American people are prevented from knowing who is financing political campaigns.
“Social Welfare” nonprofits poured more than $256 million into the 2012 federal elections, the most expensive in U.S. history. Indeed, social welfare nonprofits, known as 501(c)(4)s for their section of the tax code, emerged as the primary conduit for anonymous big-money contributions. More money was spent on TV advertising in the presidential race by social welfare nonprofits than by any other type of independent group.
In recent years, Democrats and Republicans alike have seized on seemingly innocuous wording in IRS regulations “to create the darkest corner of American political fundraising,” states ProPublica. Of the more than $256 million spent by social welfare nonprofits on ads in the 2012 elections, at least 80 percent came from conservative groups, according to the Center for Responsive Politics.
ProPublica suggests that there are six key facts that should not get lost:
1. Social welfare nonprofits are supposed to have social welfare, and not politics, as their “primary” purpose.
2. Donors to social welfare nonprofits are anonymous for a reason.
3. The Supreme Court’s Citizens United decision meant that corporations could pay for political ads, anonymously, using social welfare nonprofits.
4. Social welfare nonprofits do not actually have to apply to the IRS for recognition as tax-exempt organizations.
5. Most of the money spent on elections by social welfare nonprofits supports Republicans.
6. Some social welfare groups promised in their applications, under penalty of perjury, that they wouldn’t get involved in elections. Then they did just that.
Citizen Action: Continue to follow the IRS issue and campaign financing on one or more of the resources below. (Note: Rootstrikers and Democracy 21 were created to fight for campaign finance reform). Contact your congressional representatives and the House Oversight and Government Reform Committee and ask that Congress take the appropriate steps so that the troublesome 1959 regulations are eliminated and replaced with IRS regulations that honor the original 1913 intent. To receive the tax exemption, groups were supposed to be “operated exclusively for the promotion of social welfare.”
Beverly Bandler’s public affairs career spans some 40 years. Her credentials include serving as president of the state-level League of Women Voters of the Virgin Islands and extensive public education efforts in the Washington, D.C. area for 16 years. She writes from Mexico. Her e-mail is bgbandler@yahoo.com.
Resources
Campaign Finance Center. http://www.campaignfinance.org/
Campaign Legal Center http://www.campaignlegalcenter.org/
Free Speech for People http://freespeechforpeople.org/
Center for Responsive Politics http://www.opensecrets.org/
Citizens for Responsibility and Ethics in Washing (CREW) http://www.citizensforethics.org/
Citizens for Tax Justice http://www.ctj.org/
Common Cause http://www.commoncause.org/
Democracy 21 http://www.democracy21.org/
House Committee on Oversight & Government Reform http://oversight.house.gov/
Internal Revenue Service http://www.irs.gov
Internal Revenue Service Taxpayer Advocate Service http://www.irs.gov/advocate/index.html
League of Women Voters of the U.S. http://www.lwv.org/issues/reforming-money-politics
Mother Jones http://www.motherjones.com/
People for the American Way http:www.pfaw.org
Public.Resource https://public.resource.org/
ProPublica http:www.propublica.org
Rootstrikers http://www.rootstrikers.org/
Sunlight Foundation http://sunlightfoundation.com/
Tax Analysts http://www.taxanalysts.com/
Tax Foundation http://www.taxfoundation.org
Wikipedia http://en.wikipedia.org/wiki/United_States_House_Committee_on_Oversight_and_Government_Reform
Sources and Recommended Reading
Arkin, Steve. IRS Memo: “Section 527 disclosure proposals.” 2000-06-10. http://www.docstoc.com/docs/159553898/irs-memo
Barker, Kim. “How Nonprofits Spend Millions on Elections and Call it Public Welfare.” ProPublica, 2012-08-18. http://www.propublica.org/article/how-nonprofits-spend-millions-on-elections-and-call-it-public-welfare
Barker, Kim and Justin Elliott. “How the IRS’s Nonprofit Division Got So Dysfunctional.” The IRS division responsible for flagging Tea Party groups has long been an agency afterthought, beset by mismanagement and financial constraints. ProPublica, 2013-05-18. http://www.motherjones.com/politics/2013/05/how-irs-nonprofit-division-got-so-dysfunctional
Bernstein, Jared. “Blame Citizens United for the IRS scandal. The real outrage is why these political groups have tax-exempt status in the first place. Salon, 2013-05-15. http://www.salon.com/2013/05/15/blame_citizens_united_for_the_irs_scandal_partner/
Boardman, William. “The Other Side of The IRS Scandal.” ConsortiumNews, 2013-06-02. http://consortiumnews.com/2013/06/02/the-other-side-of-the-irs-scandal/
Chait, Jonathan. “Mitch McConnell Realizes IRS Scandal Is Over.” New York Magazine, 2013-06-21. http://nymag.com/daily/intelligencer/2013/06/mitch-mcconnell-realizes-irs-scandal-is-over.html
Costa, Robert. “McConnell: Obama ‘Refuses to Accept the Fact that the Public isn’t Going to Applaud Everything He Does.’” National Review, 2013-06-21. http://www.nationalreview.com/corner/351683/mcconnell-obama-refuses-accept-fact-public-isnt-going-applaud-everything-he-does
Elliott, Justin, Kim Barker. “6 Key Facts That Have Been Lost in the IRS Scandal.” Dark money groups continue to warp politics and get tax exemptions without having to name their donors. ProPublica, 2013-05-25. http://www.alternet.org/news-amp-politics/6-key-facts-have-been-lost-irs-scandal
Fram, Alan. “Conflicting laws, regulations feed IRS confusion.” The IRS’ attempt to enforce those contradictory laws with vague regulations has sown even more confusion, tax lawyers, former agency officials and others agree. http://news.yahoo.com/conflicting-laws-regulations-feed-irs-confusion-072327894.html
Goldmacher, Shane. “Meet the Man Who Set Off the IRS Firestorm.” J. Russell George once stalked the halls of the Capitol for senators’ autographs. Now he’s there to testify in a scandal gripping Washington. NationalJournal, Updated 2013-05-30. http://www.nationaljournal.com/congress/meet-the-man-who-set-off-the-irs-firestorm-20130522
Goodman, Peter S. “The IRS Was Dead Right to Scrutinize Tea Party.” The Huffington Post, 2013-05-15. http://www.huffingtonpost.com/peter-s-goodman/irs-tea-party_b_3280063.html
Hicks, Josh. “Rep. Elijah Cummings releases a full IRS interview transcript.” The Washington Post, 2013-06-28. http://www.washingtonpost.com/blogs/federal-eye/wp/2013/06/18/rep-elijah-cummings-releases-a-full-irs-interview-transcript/
House of Representatives, Oversight Committee. “IRS Screening Manager.” See Hicks.
Internal Revenue Service “Social Welfare: What does it mean? How much private benefit is permissible? What is a community?” 1981 EO CPE. http://www.irs.gov/pub/irs-tege/eotopicg81.pdf
_______ Tax Guide for Churches and Religious Organizations. http://www.irs.gov/pub/irs-pdf/p1828.pdf
Keegan, Michael. “The Real IRS Problem: Citizens United.” People for the American Way, 2013-05-15. http://blog.pfaw.org/content/real-irs-problem-citizens-united
Maddow, Rachel. To Politifact: ‘You Are Terrible’ And Someone Should ‘Sue You’ (VIDEO). HuffingtonPost, 2013-05-08.
http://www.huffingtonpost.com/2013/05/08/rachel-maddow-politifact-terrible-sue-you_n_3236893.html
Mencimer, Stephanie. “Tea Partiers Don’t Have a Good Legal Case Against the IRS. Here’s why.” MotherJones, 2013-06-12.
http://www.motherjones.com/politics/2013/06/tea-partiers-dont-have-case-against-irs
_______“Is This Big Tea Party Group Really an Innocent Victim of the IRS?” The tax agency may have had good reason to scrutinize Tea Party Patriots—including a formal complaint I filed in 2011. MotherJones, 2013-05-22. http://www.motherjones.com/politics/2013/05/tea-party-patriots-irs-complaint
_______ “Actually, Tea Party Groups Gave the IRS Lots of Good Reasons to Be Interested.” IRS profiling was a fiasco. Yet, some tea party groups have left a trail of fiscal problems and possible tax-code abuse. MotherJones, 2013-05-17 http://www.motherjones.com/politics/2013/05/irs-tea-party-tax-problems
Moyers, Bill and Michael Winship. “The Scandal of Lax Government.” ConsortiumNews, 2013-05-21. http://consortiumnews.com/2013/05/21/the-scandal-of-lax-government/
Muller, Sarah. ‘Exclusively’ vs. ‘primarily’: IRS law a ‘disaster waiting to happen. MSNBC. Lawrence O’Donnell, The Last Word, 2013-05-23. http://tv.msnbc.com/2013/05/23/exclusively-vs-primarily-irs-law-a-disaster-waiting-to-happen/
O’Donnell, Lawrence. VIDEO: “What scandal? Why the IRS did nothing wrong.” Interview with Marcus Owens, former head of the IRS tax exempt organization division and Julian Epstein, Democratic strategist, former counsel for the House Judiciary Committee. MSNBC, The Last Word. 2013-05-28. http://video.msnbc.msn.com/the-last-word/52028197 Transcript: http://www.nbcnews.com/id/52032832/ns/msnbc/t/last-word-lawrence-odonnell-tuesday-may-th/#.UcYvcoVyEVM
_______ Lawrence O’Donnell: “IRS Targets Who Testified Should Be Charged With ‘Perjury.’” MSNBC: Republicans on the House Ways and Means Committee called conservative grassroots activists to testify about filing their 501(c)4 applications with the IRS. But no GOP lawmakers asked why the IRS is not complying with the law that states that 501(c)4s must be devoted “exclusively” to social welfare. MSNBC’s Lawrence O’Donnell talks to Democratic Congressman Earl Blumenauer about the real IRS scandal. VIDEO. https://www.youtube.com/watch?v=fyVH8VuOTFE
Politifact. “Mostly False”: The charge by Rep. Mike Rogers (R-Mich.) on CBS’ “Face the Nation,” Sunday, June 16, 2013 that the IRS scandal “clearly showed some criminal behavior.” http://www.politifact.com/truth-o-meter/statements/2013/jun/19/mike-rogers/rep-mike-rogers-says-irs-scandal-clearly-showed-so/
Rosenfeld, Steven. “The Real Scandal: Official Washington Goes Nuts Over IRS Doing Its Job.” AlterNet, 2013-05-14.
http://www.alternet.org/news-amp-politics/real-scandal-official-washington-goes-nuts-over-irs-doing-its-job
Sargent, Greg. “The Obama IRS scandal retreats to the fever swamps.” The Washington Post, 2013-06-21. http://www.washingtonpost.com/blogs/plum-line/wp/2013/06/21/the-obama-irs-scandal-retreats-to-the-fever-swamps/
Scheiber, Noam. “Hunger Games. The conservative plan to starve government has paid off with the IRS scandal.” The New Republic, The New Republic, 2013-05-23. http://www.newrepublic.com/article/113280/irs-scandal-conservatives-plan-starve-government-pays#
_______“Notes on a Trumped Up Scandal.” The IRS fiasco shows that conservatives can be PC too.” The only real sin the IRS committed in its ostensible targeting of conservatives is the sin of political incorrectness—that is, of not pretending it needed to vet all the new groups that wanted tax-exempt status, even though it mostly just needed to vet right-wing groups. http://www.newrepublic.com/article/113217/irs-tea-party-scandal-conservative-political-correctness-action
Stein, Sam. “IRS Scandal Predicted In June 2000 Treasury Memo.” VIDEO. HuffingtonPost, 2013-06-20, Updated 06-21. http://www.huffingtonpost.com/2013/06/20/irs-scandal-treasury-steve-atkins_n_3473110.html
Toobin, Jeffrey. “When You Shouldn’t Tell the President.” New Yorker, 2013-05-21. http://www.newyorker.com/online/blogs/newsdesk/2013/05/irs-white-house-coverup-inspector-general.html
_______“The Real I.R.S. Scandal.” The New Yorker, 2013-05-14. http://www.newyorker.com/online/blogs/comment/2013/05/irs-scandal-tea-party-oversight.html
Walsh, Joan. “What the IRS did right.” Turns out some of the conservative groups it scrutinized were actively and wrongly involved in partisan politics. Salon, 2013-05-28. http://www.salon.com/2013/05/28/what_the_irs_did_right/
Ward, Jon and Sam Stein. “IRS Tea Party Scandal: White House Did Not Drive Investigation, Inspector General Says.” Huffington Post, 2013-05-14. http://www.huffingtonpost.com/2013/05/14/irs-tea-party-white-house_n_3275899.html
Weigel, David. “The IRS Scandal Is Ultron.” Slate, 2013-06-20. http://www.slate.com/blogs/weigel/2013/06/20/irs_scandal_bizarre_theory_asks_whether_the_tea_party_targeting_moved_millions.html
Wertheimer, Fred. “Inadequate IRS rules helped create scandal.” Democracy 21, 2013-05-16. http://www.democracy21.org/money-in-politics/press-releases-money-in-politics/fred-wertheimer-politico-op-ed-inadequate-irs-rules-helped-create-scandal/
Williams, Ian. “Don’t Chastise the IRS for Doing Its Job.” HuffingtonPost, 2013-05-14. http://www.huffingtonpost.com/ian-williams/dont-chastize-the-irs-for_b_3275004.html
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