New Obama Administration Crackdown Looms
on Tax-Exempt Groups
by Frances Martel 27 Nov 2013, 7:27 AM PDT
With a happy Iran at the negotiating table and
plenty of reasons to take the spotlight off health care, the Obama administration now seeks to tie the hands of political
opponents by limiting spending by tax-exempt groups with political messages.
The Treasury and IRS announced they were currently working on adapting the
tax code to limit what kinds of groups could apply for 501(c)(4) status, a
category designated for political non-profits and "social welfare"
groups that follow less stringent spending rules than political action
committees (PACs). The Obama administration's proposed changes to the code
would prevent 501(c)(4)s from engaging in advocacy for a specific candidate and
political advocacy generally, including paying for campaign ads on television.
Treasury Assistant Secretary for Tax Policy Mark Mazur called the move "a
first critical step toward creating clear-cut definitions of political activity
by tax-exempt social welfare organizations."
Unlike PACs, 501(c)(4)s do not currently
have to disclose donors legally. They have surpassed unions and trade
associations in political spending and become a pivotal part of the
post-Citizens United campaign finance landscape. They do not aid candidates
directly, but take on issues and buy ads that directly argue to the public one
way or another. While the groups can be of any political stripe, spending by
conservative groups has greatly surpassed that by liberal organizations like
Organizing for America.
And although the measure would crack down on bigger organizations like Karl
Rove's Crossroads GPS, the strength of smaller, Tea Party-central advocacy
groups who rely on their tax exempt status to promote messages mainstream
political figures would otherwise ignore would most likely be among the hardest
hit.
Conservatives both complying with the law
in their roles running 501(c)(4)s and those in office have responded to the
measure with uniform outrage. A spokesman for the NRA, a 501(c)(4), called the
measure a "blatant abuse of the tax code designed to muzzle the American
people's free speech rights." Rep. Darrell Issa described the move as a
"crass political effort," and placed emphasis on the fact that unions
and trade organizations-- often much more likely to contribute to liberal
efforts-- were left to their own devices while the IRS and Treasury turned on
these particular political non-profits.
This isn't the first time the IRS proposes
to crack down on political groups voicing opposition to President Obama's
policies, but it is the most sweeping attempt. Controversy with such groups
came to a peak this year when it was discovered that more than 80% of 501(c)(4)
groups on the IRS' watch list between 2010 and 2012 were conservative and/or
Tea Party affiliated organizations.
While the administration promises careful
scrutiny of the tax code before making any large changes, President Obama's
vocal disapproval of the expressive freedoms protected by the Citizens United
ruling and his administration's targeting of opposition groups through the IRS
leave little room to expect tax reforms to have anything but a chilling effect
on the national political discourse.
Internal Revenue Service (IRS)
& the U.S. Department of the Treasury
Charles
O. Rossotti was the commissioner for the Internal
Revenue Service (IRS), and is a director at the Atlantic
Council of the United States
(think tank).
Note: Open
Society Foundations was a funder for the Atlantic
Council of the United States
(think tank).
George Soros
is the founder & chairman for the Open Society Foundations,
and the chairman for the Foundation to Promote Open
Society.
Foundation
to Promote Open Society was a funder for the Aspen
Institute (think tank).
Timothy
D. Adams is a director at the Atlantic Council of the United States
(think tank), and was the under secretary for the U.S. Department of the Treasury.
Herbert
M. Allison Jr. was a director at the Atlantic Council of the United States
(think tank), and an assistant secretary for the U.S. Department of the Treasury.
David
D. Aufhauser is a director at the Atlantic Council of the United States
(think tank), and was the general counsel for the U.S. Department of the Treasury.
James
A. Baker III is a director at the Atlantic Council of the United States
(think tank), and was the secretary for the U.S.
Department of the Treasury.
Kenneth W.
Dam is a director at the Atlantic Council of the United States
(think tank), and was the deputy secretary for the U.S. Department of the Treasury.
Stuart
E. Eizenstat is a director at the Atlantic Council of the United States
(think tank), and was the deputy secretary for the U.S. Department of the Treasury.
Robert
M. Kimmitt is a director at the Atlantic Council of the United States
(think tank), and was the deputy secretary for the U.S. Department of the Treasury.
Teresa M.
Ressel is a director at the Atlantic Council of the United States
(think tank), and an assistant secretary for the U.S. Department of the Treasury.
George P. Shultz
is a director at the Atlantic Council of the United States
(think tank), and was the secretary for the U.S.
Department of the Treasury.
Nancy Killefer
was the assistant secretary for the U.S. Department of the
Treasury, the nominee for chief performance officer for the Barack Obama administration, and a member of the IRS Oversight Board.
IRS
Oversight Board is a citizen’s board for the Internal
Revenue Service (IRS).
Deborah
L. Wince-Smith was a member of the IRS Oversight Board,
and is a member of the Belizean Grove.
Henrietta
Holsman Fore is a member of the Belizean Grove,
and a trustee at the Aspen Institute (think
tank).
Henry A. Kissinger
was a lifetime trustee at the Aspen Institute
(think tank), is a member of the Bohemian
Club, the founder of Kissinger Associates, Inc.,
an overseer at the International Rescue
Committee, a director at the Atlantic
Council of the United States (think tank), a director at the
American Friends of Bilderberg
(think tank), and a 2008 Bilderberg conference
participant (think tank).
Timothy
F. Geithner was a researcher at Kissinger Associates, Inc.,
an overseer at the International Rescue Committee,
and the secretary for the U.S. Department of the
Treasury.
Charles
O. Rossotti is a director at the Atlantic Council of the United States
(think tank), and was the commissioner for the Internal
Revenue Service (IRS).
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