Could Anger At the IRS Unite Democrats And the Tea Party?

What could bring reform advocates and tea partyers together? Anger at the IRS.

Tea Party supporters gather for a rally outside the IRS headquarter in Washington, May 21, 2013. A few dozen tea party activists and their supporters have gathered outside the IRS headquarters in Washington to protest extra scrutiny of their organizations.
National Journal
Patrick Reis
Add to Briefcase
See more stories about...
Patrick Reis
Aug. 21, 2013, 8:31 a.m.

Rep. Chris Van Hol­len has a pro­pos­al he says can as­suage both the tea party’s con­cerns over IRS over­reach and pro­gress­ives’ fret­ting over the flood of an­onym­ous cam­paign cash un­leashed by the Su­preme Court’s Cit­izens United rul­ing.

His plan: Sue the IRS.

The Mary­land Demo­crat  an­nounced Wed­nes­day that he is su­ing the agency, as well as the Treas­ury De­part­ment, to de­mand a change in the way they eval­u­ate non­profits that pro­claim them­selves to be “so­cial-wel­fare” or­gan­iz­a­tions.

The IRS cur­rently al­lows such or­gan­iz­a­tions — a class of power play­ers known as “tax-ex­empt 501(c)4s,” whose ranks in­clude Karl Rove’s Cross­roads GPS and the Obama-aligned Pri­or­it­ies USA — to dabble in polit­ic­al ad­vocacy, so long as they keep such activ­it­ies sec­ond­ary to their gen­er­al char­it­able work.

But Van Hol­len says that such a “primary char­it­able, sec­ond­ar­ily polit­ic­al” ar­range­ment leaves open a loop­hole for overtly polit­ic­al or­gan­iz­a­tions to ex­ploit be­ne­fits in­ten­ded to be re­served for char­it­ies. Chief among those be­ne­fits is that 501(c)4s do not have to dis­close their donors, and so cor­por­a­tions, uni­ons, and oth­er groups can pour money in­to ad­vocacy ef­forts without fear­ing pub­lic back­lash, or in­deed any pub­lic scru­tiny at all.

Hop­ing to lift the cur­tain on polit­ic­al spend­ing, Van Hol­len wants the IRS to re­write its rules to re­quire 501(c)4s to en­gage ex­clus­ively in so­cial-wel­fare activ­it­ies, and keep out of polit­ic­al spend­ing en­tirely. If the groups want to get in­to polit­ics, they should re­gister un­der a dif­fer­ent non­profit clas­si­fic­a­tion — known as 527s — that would pro­tect the groups from tax­a­tion but re­quire them to dis­close all of their donors.

“You can spend the money, but the law does re­quire, as Con­gress in­ten­ded, that you [tell] the pub­lic where the money is com­ing from,” Van Hol­len said Wed­nes­day.

The fight over polit­ic­al spend­ing has taken on new ur­gency since 2010, when the Cit­izens United de­cision struck down cam­paign fin­ance laws that had pre­vi­ously checked out­side groups’ polit­ic­al spend­ing.

Out­side polit­ic­al spend­ing has ex­ploded since the de­cision, as have the num­ber of groups seek­ing 501(c)4 status. More than 3,200 groups sought the status in 2012, as op­posed to 1,735 in 2010.

Van Hol­len said that his primary goal in the suit was cam­paign fin­ance trans­par­ency, but he hoped that the suit’s an­cil­lary con­sequences could pull in al­lies from the op­pos­ite end of the polit­ic­al spec­trum.

Con­gres­sion­al Re­pub­lic­ans have been out­raged over the IRS’s cam­paign fin­ance role since the agency ad­mit­ted earli­er this year that some of its em­ploy­ees had used cri­ter­ia that tar­geted tea-party groups seek­ing 501(c)4 status for closer scru­tiny.

Van Hol­len re­jec­ted Re­pub­lic­ans’ claim that the IRS was en­gaged in polit­ic­ally mo­tiv­ated at­tacks, echo­ing Demo­crats’ re­cent claims that lib­er­al groups were also in the agency’s crosshairs. But he said the prob­lem could be rendered moot by re­mov­ing the IRS’s ob­lig­a­tion to judge where groups stand along the blurred line between so­cial wel­fare and polit­ic­al ad­vocacy.

What We're Following See More »
SANS PROOF
NRA Chief: Leftist Protesters Are Paid
1 days ago
UPDATE
NEW TRAVEL BAN COMING SOON
Trump Still on Campaign Rhetoric
1 days ago
UPDATE
“WE’RE CHANGING IT”
Trump Rails On Obamacare
1 days ago
UPDATE

After spending a few minutes re-litigating the Democratic primary, Donald Trump turned his focus to Obamacare. “I inherited a mess, believe me. We also inherited a failed healthcare law that threatens our medical system with absolute and total catastrophe” he said. “I’ve been watching and nobody says it, but Obamacare doesn’t work.” He finished, "so we're going to repeal and replace Obamacare."

FAKE NEWS
Trump Goes After The Media
1 days ago
UPDATE

Donald Trump lobbed his first attack at the “dishonest media” about a minute into his speech, saying that the media would not appropriately cover the standing ovation that he received. “We are fighting the fake news,” he said, before doubling down on his previous claim that the press is “the enemy of the people." However, he made a distinction, saying that he doesn't think all media is the enemy, just the "fake news."

FBI TURNED DOWN REQUEST
Report: Trump Asked FBI to Deny Russia Stories
1 days ago
THE LATEST

"The FBI rejected a recent White House request to publicly knock down media reports about communications between Donald Trump's associates and Russians known to US intelligence during the 2016 presidential campaign, multiple US officials briefed on the matter tell CNN. But a White House official said late Thursday that the request was only made after the FBI indicated to the White House it did not believe the reporting to be accurate."

Source:
×
×

Welcome to National Journal!

You are currently accessing National Journal from IP access. Please login to access this feature. If you have any questions, please contact your Dedicated Advisor.

Login