The real IRS Scandal: Legal challenge to 1959 IRS regulation re: 501(c)(4) tax exempt status
Posted by AzBlueMeanie:
It looks as if MSNBC host of the The Last Word, Lawrence O'Donnell, tax analyst David Cay Johnston (and I) finally have the attention of someone in Congress about The real IRS scandal: the ease with which political organizations have been abusing the 501(c)(4) tax exempt status.
Paul Blumenthal writes at the Huffington Post, Chris Van Hollen: IRS Rules To Be Challenged In Court:
Rep. Chris Van Hollen (D-Md.) said Tuesday that he and two campaign
finance watchdog groups would sue the IRS, challenging regulations that
allow nonprofit groups to be involved in politics if they're "primarily"
devoted to a social welfare purpose.
Van Hollen said he and watchdog groups Campaign Legal Center and
Democracy 21 would sue to clarify an IRS regulation that he said was at
odds with the law, which requires certain groups to "exclusively" engage
in social welfare to earn nonprofit status. The IRS regulation
permitting groups “primarily” engaged in social welfare allows the
organizations to participate in an undefined amount of political
activity, said the congressman, a leading advocate of campaign finance
reform and ranking member of the House Budget Committee.
The 1959 IRS regulation has become an issue since the Supreme Court's 2010 Citizens United decision opened the door for nonprofit groups organized under section 501(c)(4) and 501(c)(6) of the tax code to raise and spend corporate and union money on elections without disclosing donors. The scandal involving the agency's singling out conservative groups applying for nonprofit status has increased attention to the regulation, especially among Democratic lawmakers.